Ørsted Pauses All Offshore Activities in Taiwan

There has been a lot of news concerning the latest trend market for offshore wind - Taiwan - in the last year. Now some of this buzz ends abruptly: The world's biggest offshore wind developer, Danish company Ørsted, has pressed the pause button for all its activities.

In April 2018, Taiwan’s Ministry of Economic Affairs awarded Ørsted the right to install 900MW offshore wind from its Changhua 1 and 2a projects in 2021. In accordance with Taiwan Civil Code, the deadline for signing the 2018 power purchase agreement (PPA) was extended to 2 January 2019. As Taiwan’s Bureau of Energy has not issued an establishment permit for the projects by close of business local time, it is no longer possible for Ørsted and the Taiwanese utility Taipower to sign a 2018 PPA for Changhua 1 and 2a.

The 2019 feed-in-tariff has not been decided yet, however, in November 2018 the Taiwanese government proposed a 2019 feed-in-tariff of TWD5,106 (approx. EUR145) per MWh and suggested a production cap of 3,600 annual full-load hours.

Apparently, Ørsted is not satisfied with this tariff and thus has stopped all activities in the country. Martin Neubert, CEO, Ørsted Offshore, says: "We’re very concerned about the suggested feed-in-tariff level for 2019 as well as the newly proposed cap on annual full-load hours. We will need to see significant changes to these proposals before we can progress any further towards a final investment decision on the projects.”

“The proposed retrospective changes would jeopardise the creation of a local offshore wind supply chain, harm the planned transition to renewable energy and cause significant uncertainty among international investors looking to Taiwan. Only with a stable and predictable policy framework, Taiwan has the potential for developing large-scale clean power production while creating thousands of local jobs and becoming a hub for offshore wind in Asia-Pacific,” warns Neubert.