Taiwan to cut offshore wind tariff by 13 percent

The future of a number of offshore wind farms in the east-Asian market is now uncertain following a a proposal from Taiwan's government. We look forward to entering a dialog with authorities about prices and local content, says Copenhagen Infrastructure Partners.

Photo: Deepwater Wind

This will not be a quiet holiday season for offshore wind developers in Taiwan. The state government has just presented a proposal, entailing that offshore wind farms which land Power Purchase Agreements (PPAs) next year will be subject to paying a feed-in tariff of TWD 5.106 (EUR 0.15) per kWh. That is almost 13 percent under the tariff of TWD 5.8498 per kWh that is ensured if a PPA is entered before the new year, reports Taiwan's government in a statement.

Furthermore, the proposal also seeks to amend two other parameters – firstly, to cap PPAs at 3,600 full-load hours per year, per turbine, which is lower than the estimate of approximately 4,000 full-load hours that offshore wind turbines will be capable of generating in the context of Taiwan's strong wind conditions. Secondly, that it should not be possible to receive a higher tariff during the first ten years, when impairment expenses are higher, whereas the tariff rate is reduced in subsidy period's second half.

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