Taiwan's green power surge: 2024 forecasts reveal 37 billion kWh supply boom

Annie Huang, Taipei; Vyra Wu, DIGITIMES Asia 0


The Ministry of Economic Affairs (MOEA) recently announced the feed-in tariff rates for various types of renewable energy in 2024. Except for a slight reduction in the tariff rates for solar photovoltaics (PVs), the rates for other renewable energy sources remain unchanged or have slightly increased. At the same time, green power supply volume is expected to reach 3.7 billion kWh in 2024. Businesses believe that the demand for green power continues to rise, especially with the significant growth in solar PV supply in 2023.

Among the types of renewable energy, solar PV development is relatively mature and scalable. Additionally, ground-mounted solar PV development has somewhat boosted the total electricity generation from renewable sources as large-scale offshore wind power projects are still under construction.

According to PwC Taiwan, 9.5% of Taiwan's total electricity generation of 282.1 billion kWh in 2023 came from renewable sources. Solar energy generation reached 12.9 billion kWh, accounting for about 48% of the total renewable energy generation, an increase of 2.2 billion kWh compared to 2022.

In response to the trend of net-zero carbon emissions and energy transition, the number of entrepreneurs entering the market to procure green power has been increasing annually. This trend has led to continuous growth in power trading volume and stimulated the development of the power sales industry. As of December 2023, 56 renewable energy companies have obtained permits from the Energy Administration to bridge the gap between supply and demand.

However, some businesses mention that while the green power supply is expected to reach 3.7 billion kWh in 2024, the demand for green power will only continue to increase. Large corporations are the main purchasers of green power, but as small and medium-sized enterprises gradually enter the market, the demand for green power will grow even further. It is estimated that in the next few years, as offshore wind power projects come online, the insufficient supply of green power may slightly ease.

The estimated direct green power supply volume for 2023 is 1.7 billion kWh, accounting for 6% of total renewable energy generation. MOEA's latest estimate suggests that the green power supply volume could reach 3.7 billion kWh in 2024. Looking back at 2023, solar PV increased to 620 million kWh, growing by over 200% compared to 190 million kWh in 2022. The volume of power supplied through renewable energy power sellers increased from 57 million kWh in 2022 to 320 million kWh, an increase of over fivefold.

PwC Taiwan states that the current purchasers of green power include companies in the technology, manufacturing, finance, and telecommunications industries. The significant growth in solar PV supply indicates the keen demand for green power among Taiwanese companies, aligning with trends such as RE100 and corporate social responsibility.

Power sellers also note that technology companies have the strongest purchasing power. Semiconductor manufacturers, for example, need green power to meet the RE100 requirements of international giants, necessitating the use of green power in their facilities both in Taiwan and overseas, thereby opening up overseas market opportunities for the power sales industry.

Regarding the development of the power sales industry, KPMG mentions Google's "24/7 Carbon Free Energy (CFE)" released in 2021. The agreement aims to achieve the goal of zero-carbon energy around the clock through collaboration with suppliers, governments, system operators, and investors.

However, this agreement requires an adequate supply of renewable energy facilities, a robust grid system, and mature green power trading and supply mechanisms. Some countries still lack these conditions. Therefore, initiatives like Taiwan's liberalization of green power trading in 2020, along with the establishment of zero-carbon power system technology and the introduction of virtual power plant mechanisms coupled with energy aggregators for green power time matching and scheduling, can reduce carbon emissions and address issues during peak electricity consumption periods.