Taiwan

Taiwan

Northland and Yushan progress in Taiwan

Northland Power and Yushan Energy have signed a power purchase agreement (PPA) with Taiwanese utility Taipower for the 300MW Hai Long 2A wind farm, the first project from a 1GW-plus cluster owned by the joint venture.

Developers expressed concerns about the economic viability of projects under reduced tariffs (pic: Toby Oxborrow)
Developers expressed concerns about the economic viability of projects under reduced tariffs (pic: Toby Oxborrow)

It will receive the 2019 feed-in tariff rate of TWD 6,279.50/MWh ($204/MWh) for the first ten years of operation and TWD 4,142.20/MWh ($134.53/MWh) for the second ten-year period of the 20-year PPA.

A tiered production cap will be in place throughout both ten-year periods.

Under this, a developer receives 100% of the tariff for production up to 4,200 annual full-load hours; then 75% for production between 4,200 and 4,500 full-load hours; and 50% for production above 4,500 full-load hours.

The joint venture chose the tiered tariff over a flat rate of TWD 5,516/MWh ($179.2/MWh) for 20 years.

Taiwan’s ministry of economic affairs revised the tariff for offshore wind in late January, after reaching a compromise on its proposed FIT rate with the industry. 

Several developers missed a 2 January deadline to sign power deals with Taipower, meaning they missed out on a higher tariff rate that was offered when the projects were awarded in the first half of the year. 

Taiwan's government then proposed a 12% cut on the FIT for PPA deals signed in 2019, causing uproar within the industry and forcing the negotiations between developers, trade associations and the authorities. 

The compromised TWD 5,516/MWh flat rate is 6% below the tariff offered in 2018.

Northland owns a 60% stake in the 1,044MW Hai Long cluster off Taiwan’s north-west coast, while Yushan Energy owns the remaining 40%.

Danish developer Ørsted halted project development in Taiwan after the government cut the tariff, but has since obtained an establishment permit for its 900MW of projects there.

It is unknown which tariff other developers — including Copenhagen Infrastructure Partners and China Steel Corporation — have chosen.

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