Taiwan's Energy Conundrum
Ssu-Li Chang, Professor, Institute of National Resource Management, Taiwan; Herng-Shinn Hwang, Manager, Songya Technology LLC; Chi-Yuan Liang
Minister without Portfolio, Executive Yuan, Taiwan, and Research Fellow, Academia Sinica, Taiwan; Hongyi Lai, Associate Professor, University of Nottingham
In 2008, Taiwan imported 99.23 percent of its energy resources, and 91.3 percent of its primary energy was derived from fossil fuels. Such statistics highlight the island's extreme vulnerability to price fluctuations in the global energy market and raise serious questions about its energy security strategy. The Taiwan Renewable Energy Act, passed in June last year, will channel more investment into green energy technologies, but this will not be enough to significantly offset Taiwan's current energy imports. How has Taiwan continued to conduct its energy diplomacy? What are the major issues involved in securing its energy supply? And what is the role of its relationship with mainland China in its energy security strategy? On Tuesday, June 22, the Asia Program hosted an event, co-sponsored by the Global Energy Initiative and the China Environment Forum, to discuss these and related questions.
Ssu-Li Chang, professor at the Institute of Natural Resource Management at National Taipei University and Taiwan Director of CPC Corporation, noted that the challenge confronting Taiwan is especially acute due to its energy profile. As an island, Taiwan needs to maintain its own isolated electricity supply system and cannot import electricity from elsewhere. This has led to its import dependency, which is highly concentrated on fossil fuels. To deal with these supply issues, the Taiwanese government has implemented a new energy policy focused on maintaining efficiency, cleanliness, and stabilization of supply. There are plans to drop energy intensity levels to 20 percent of 2005 levels by 2015, and to lower carbon dioxide (CO2) to 2005 levels by 2020, while constructing an energy supply system to meet the demands of development that would accompany the government's target of 6 percent economic growth.
How might Taiwan attain the dual goals of economic development and cleaner energy? Increasing the nation's nuclear energy output has been offered as a potential partial solution. However, Herng-Shinn Hwang, director of Songya Technology, LLC, who advised the previous Taiwanese government on energy issues, believes that nuclear power plants generate unwelcome problems, such as nuclear waste and safety concerns. Hwang sees more promise in alternative "green" energies. Southern Taiwan receives about 300 days of sunlight a year, making solar energy—which may incur massive initial outlays, but is virtually free once panels are installed—an attractive option for the future. Taiwan also has ample wind, and as an island will be able to take advantage of wave power technology once it becomes economically feasible. Taiwan, according to Hwang, has the technological prowess and the motivation to become a leader in the field of alternative energy, and thus should seriously reconsider the development of any more nuclear facilities.
While noting the importance of renewable energy, Chi-Yuan Liang, minister without portfolio in Taiwan's Executive Yuan, pointed out that green technologies are not a sufficient replacement for inefficient and polluting fuels—such as coal—already used by Taiwan. While Liang stressed that research and development in green technology would be necessary for Taiwan to increase its long-term competitiveness in renewable energy industries, he also argued that an increase in Taiwan's electricity supply from nuclear sources is the only realistic alternative to the use of fuels such as coal. The promotion of less energy-intensive sectors, such as service industries, and government regulations to ensure offsets for energy-intensive industries can also promote efficiency and curb CO2 emissions. Liang also believes that Taiwan and the United States should explore avenues for technical and political cooperation on climate change, such as joint development of green and nuclear technologies, and the promotion of environmentally friendly practices in the Third World.
As with most policy discussions about Taiwan, the presence of mainland China (PRC) looms large. Hongyi Lai, associate professor at the University of Nottingham pointed out several areas for cooperation on energy-related issues between Taiwan and the PRC. Although there have been several failed attempts to cooperate on coal and oil development issues, there have also been a number of successful joint development efforts. Taiwan, with its advanced technological base, also has much to teach China, which is suffering the environmental consequences of its rapid development, and there is scope for cooperation in the development of green technologies. At the same time, Taiwan's extensive reliance on oil and natural gas means that it would be highly vulnerable to Chinese blockades, should China ever decide that war with Taiwan is in its best interests.
By Bryce Wakefield
Robert M. Hathaway, Director, Asia Program