Taiwan finally unveils offshore wind allocations

Some developers were granted less capacity than they applied for.

The Taiwanese Bureau of Energy (BOE) has announced the much anticipated allocations for the first offshore wind projects in Taiwan. For the first round (commissioning by 2020), Swancor/Macquarie and WPD have been allocated 378MW and 360MW each, respectively.

For the second round (commissioning between 2021 and 2025), the following developers have received allocation:

These announcements will start the next phase of the development of the Taiwanese offshore wind industry and it shows the government's commitment to execute on its earlier plans for the sector.

President Tsai Ing-wen has pledged to end the island's dependence on nuclear power by 2025 whilst sourcing 20% of Taiwan's electricity from renewables, five times the share in 2015. Her plan depends on offshore wind, for which the Taiwan Strait is particularly suitable. Wind speeds in the strait average over 25km per hour year-round, making it the best place in Asia to generate wind power.

"In total, over 3.8GW has bee allocated. Some of the developers were granted less capacity than applied for, and it seems that some of the projects have not been allocated any capacity at all. Now that results are out, developers will have to work hard to get their projects commissioned in time. We expect that some of the applicants for this selection process will also apply for additional capacity during the auction process due later this year," Alex Wong, partner at Hogan Lovells.

It is the expectation that the announcements will set off a flurry of activities among developers, contractors, financiers, and consultants.

The announcement will also have a positive impact on the other markets in Asia. According to Joseph Kim, partner at Hogan Lovells, "As sponsors can now start developing their projects in Taiwan, they will have a closer look at markets such as Japan and South Korea. Lessons learned from developing in Taiwan will be valuable when going into those markets."

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