Taiwan Offshore Wind Power Revolution: The Transformation Path Toward 2025's 20% Renewable Energy Target

Taiwan's Energy Transition Starting Point: Three Pressures

Taiwan's energy transition policy faces three structural pressures, forcing the government to accelerate the push for offshore wind power:

1. Nuclear-Free Home Policy: The 2016 energy policy established a goal to phase out nuclear power by 2025, with three nuclear power plants gradually being decommissioned. Nuclear power, which originally accounted for about 10% of total electricity generation, needs to be replaced by renewable energy.
2. Climate Commitments: Taiwan has committed to net-zero emissions by 2050, with the 2030 renewable energy target raised from 20% to over 30%.
3. Surge in Technology Sector Electricity Demand: Semiconductor fabs such as TSMC and MediaTek continue to expand operations, while AI computing demands are driving data center construction. Taiwan's electricity consumption is projected to increase by over 20% in 2030 compared to 2023. TSMC has committed to achieving 100% renewable energy use by 2040, with annual green power procurement needs exceeding 10 billion kWh.

Taiwan Offshore Wind Status: 2024 Baseline

Installed Capacity and Development Timeline

As of the end of 2024, Taiwan's cumulative offshore wind installed capacity totals approximately 2.25GW, comprised primarily of the following completed wind farms:

• Hai Long Phase 2: Developed by Ørsted, 300MW, grid-connected in 2024
• Greater Changhua Southeast/Southwest: Developed by Copenhagen Infrastructure Partners (CIP), 605MW, completed
• Formosa 2: Jointly developed by Macquarie and partners, 376MW, completed in 2023

2024 Renewable Energy Mix

Taiwan's renewable energy generation accounted for 11.6% of total electricity in 2024, with the following breakdown:

• Solar: approximately 6.8% (rooftop + ground-mounted)
• Offshore wind: approximately 2.1%
• Onshore wind: approximately 1.1%
• Hydro, biomass, and others: combined 1.6%

With the 2025 target set at 20%, there remains an 8.4 percentage point gap to close, making achievement highly challenging.

Key Developers and Competitive Landscape

International Developers

Ørsted is the most important international developer of offshore wind power in Taiwan, with completed and in-development capacity exceeding 1GW. Ørsted, a subsidiary of Danish National Oil Company, possesses the world's most extensive experience in offshore wind farm construction, having built over 10GW in Europe. However, Ørsted announced its withdrawal from U.S. East Coast offshore wind development in 2023 (due to rising interest rates and cost overruns), raising market concerns about confidence in its Taiwan projects. The company continues to advance its Phase 3 projects in Taiwan.

Copenhagen Infrastructure Partners (CIP) holds multiple Phase 3 blocks in Taiwan, with potential development capacity exceeding 3GW off the coast of Changhua. It is currently one of the largest foreign investors in Taiwan's offshore wind power Phase 3.

Rise of Local Developers

The government requires offshore wind power developers to use locally manufactured supply chain components through its "localization" policy, with the required percentage increasing annually. Taiwan Power Company (Taipower) holds equity stakes in multiple wind farms, and China Steel Corporation has established CNMC to enter offshore wind power development, indicating steadily growing local participation.

Localized Supply Chain: Opportunities and Challenges Coexist

The government's mandate for Phase 2 (2020-2025) requires developers to achieve a certain localization ratio, prompting Taiwanese manufacturers to rapidly build capabilities in the following areas:

• Substructure (Monopile): CSBC has secured offshore wind substructure fabrication orders, producing high-difficulty steel pipe piles
• Marine Engineering: Taiwan's domestic marine engineering fleet is growing rapidly, with base facilities under construction in Penghu and Taichung Port
• Cables: China Electric is expanding its production capacity to undertake submarine cable orders
• Blades: Despite the highest technical complexity, domestic players are still evaluating investment feasibility

On the challenge side, while the localization requirements have spurred domestic industry development, they have also driven up Taiwan's offshore wind power generation costs, with the feed-in tariff (FIT) at approximately NT$5-6 per kWh, which is higher than the European market average. Achieving a balance between localization and cost competitiveness remains the core policy design challenge.

TSMC Green Power Demand: Private Sector Driver

TSMC has committed to achieving 100% renewable energy usage by 2040. Currently, its annual electricity consumption exceeds 25 billion kWh, accounting for approximately 8% of Taiwan's total electricity use. To achieve this goal, TSMC is actively procuring:

• Power Purchase Agreement (PPA): Signing fixed-price procurement contracts with developers such as Ørsted for up to 20 years
• Renewable Energy Certificate (REC): Purchasing renewable energy certificates from offshore wind and solar sources
• Self-installed rooftop solar: Deploying large-scale solar panels on factory rooftops

TSMC's substantial green power procurement needs provide Taiwan's offshore wind developers with a long-term stable buyer, effectively reducing project financing risks and accelerating overall industry development.

2025-2030 Outlook

Taiwan's third-phase offshore wind auction (capacity exceeding 15GW) is currently underway, with completion expected in phases from 2026 to 2035. If progress goes as planned, Taiwan's installed offshore wind capacity could exceed 10GW by 2030, coupled with continued solar expansion, the renewable energy share is expected to reach 25-30% by 2030.

The biggest risk in the energy transition lies in lagging grid upgrades: if the construction pace of Taiwan's extra-high-voltage transmission lines cannot keep up with renewable energy installed capacity, it will lead to significant curtailment. Taipower estimates it will need to invest over NT$5,000 billion in grid reinforcement from 2025-2030, which is a critical prerequisite for successful transformation.

Frequently Asked Questions

What is Taiwan's renewable energy electricity generation ratio in 2024?

Taiwan's renewable energy electricity generation ratio was approximately 11.6% in 2024, with solar energy accounting for about 6.8%, offshore wind power about 2.1%, and onshore wind power about 1.1%. The government set a target of 20% for 2025, but current progress is lagging behind. Expanding offshore wind power capacity is key to closing the gap.

Which companies primarily develop Taiwan's offshore wind power projects?

The major international developers include Ørsted from Denmark and Copenhagen Infrastructure Partners (CIP). On the domestic side, Taiwan Power Company (Taipower) and China Steel Corporation's subsidiary, China Energy Development Company, are actively participating. Through localization policies, the government requires the use of local supply chains, and Taiwanese companies such as CSBC Corporation and Taiwan Cable have secured significant contracts for underwater foundations and submarine cables.

How does TSMC affect Taiwan's renewable energy market?

TSMC consumes over 25 billion kWh of electricity annually, accounting for approximately 8% of Taiwan's total electricity consumption, and has committed to reaching 100% renewable energy usage by 2040. TSMC has signed large-scale long-term Power Purchase Agreements (PPAs) for offshore wind power, providing developers with stable cash flows, effectively reducing financing costs, and accelerating the development of Taiwan's offshore wind power market.

What is Taiwan's 2030 renewable energy target?

The Taiwan government has raised its 2030 renewable energy electricity generation target to above 30% and set a net-zero emissions goal for 2050. The third phase of offshore wind power tendering has a capacity exceeding 15 GW. If implemented according to plan, offshore wind power installed capacity could exceed 10 GW by 2030, working together with solar energy to achieve these targets.