Taiwan’s Alternative Energy Options

Taiwan is making big moves in solar and offshore wind, but are there also other energy forms that deserve attention?

As Taiwan progresses toward its goal of 20% of power generation from renewable energy sources, the shortcomings of solar and wind are becoming increasingly evident. Solar power requires vast swathes of land, a precious commodity in Taiwan, and offshore wind is costly and environmentally disruptive. Both are also intermittent, generating large amounts of power when conditions are good but at times dropping to zero.

Some experts suggest that Taiwan’s concentration on solar and wind power is causing it to neglect other forms of renewable energy – including geothermal, biofuels, and ocean power – that could offer even greater advantages. Technical difficulties account for much of the lack of development of alternative energies, but some of the holdup is policy related.

The government’s 2025 deadline for the elimination of nuclear power is fast approaching, and Taiwan will need to replace not only its nuclear power but also a significant amount of coal-fired power generation. It therefore requires proven sources of renewable power that can be deployed in large scale within a short timeframe.

“This is a big change and the time is very tight,” notes Lee Chun-li, deputy director general of the Bureau of Energy under the Ministry of Economic Affairs. Considering the challenges facing Taiwan’s energy supply, “the current policy [emphasizing solar and offshore wind] is the most realistic,” he says.

Nevertheless, advocates for geothermal, biofuels, and ocean energy argue that Taiwan should also be looking more seriously at other options that could eventually offer great potential. 


A geothermal power plant operates similarly to a nuclear or coal-fired steam generator but with magma buried deep beneath the earth’s surface as its heat source. Unlike intermittent wind or solar resources, geothermal power can operate continuously and serve as baseload power. However, geothermal reservoirs are accessible from only a small portion of the earth’s surface. 

Located along the seismically active Pacific Ring of Fire and replete with hot springs, Taiwan would seem a likely candidate for geothermal power development. The island has a long history of exploring geothermal power, having first considered its potential in the 1970s during the two international oil crises. But while such other countries as New Zealand and the Philippines took firm measures to develop the sector, Taiwan opted for nuclear power instead, largely abandoning geothermal.

The small Chingshuei geothermal power plant in Yilan County. Photo: Wikipedia

Geologic surveys conducted by the government over the years have found that the geothermal potential in Taiwan could be as high as 32 gigawatts (GW) of installed capacity, which would be sufficient to supply most of Taiwan’s power needs. The administration’s goal for geothermal is modest, though. It plans to have only 200 megawatts (MW) of capacity in place by 2025 – less than 1% of the total renewable power target.

Li Yi-heng, a senior researcher at the Industrial Technology Research Institute (ITRI)’s Energy & Environment Research Laboratories, attributes the limited reliance on geothermal to Taiwan’s geology. The island’s complex geological formations and vertical faults pose a major obstacle. Further, the most readily accessible geothermal resources are adjacent to volcanoes, but Taiwan has only one volcano – at Datun Mountain in northern Taiwan.

“It is actually riskier and more difficult to explore for geothermal reservoirs here than in Japan, the Philippines, or Indonesia – all countries that use more geothermal energy,” Li says. As with oil exploration, exploratory wells must be drilled to confirm the location of the reservoir. Drilling costs can be up to US$4 million for a two-kilometer-deep well, with only about a 30% success rate.

Most of Taiwan’s potential geothermal reserves are also located within Aboriginal lands or national parks or beneath slope lands – all areas that are off limits to development.

In addition, Taiwan lacks clear rules governing ownership of the resource once it is discovered. Most developable land is held in small, privately owned units, and any underground reservoir would likely extend beneath several private properties. If a geothermal plant were to be built on one plot of land, no regulation would prevent a neighbor from doing the same, causing depressurization and loss of resource.

The Taiwan Geothermal Association, an organization established mainly by academics, is pushing for passage of a Geothermal Act modeled on similar laws in the United States, New Zealand, and elsewhere. The aim is to clarify ownership and generate more interest in the sector. In the meantime, ITRI and academic institutions in Taiwan are collaborating with research organizations from abroad to study possibilities for exploring and developing geothermal power in Taiwan.

To offset the risks, the Taiwan Geothermal Association sought a 15% increase in the Feed-in-Tariff for 2020, but the government denied the request.  The current FiT for geothermal is set at NT$5.19 per kilowatt-hour, higher than for other renewables but still insufficient to stimulate investment, according to Lee Chao-shing, professor at the Institute of Applied Geosciences at National Taiwan Ocean University and a leading member of the Association.

The several small ongoing exploration projects are being carried out by state-owned enterprises Taiwan Power Co. and CPC Corp. Taiwan (the oil company is the only firm in Taiwan with deep-well drilling technology), together with ITRI. The largest of these projects, at Datun Mountain, will account for 150MW of the total 200MW goal for 2025.


Over the years Taiwan’s research institutes and universities have developed various technologies to derive fuels from organic feedstocks, and several biofuel startups have been launched. Some have succeeded by focusing on higher value products. For example, ITRI spinoff Butyfix moved away from producing butenyl into higher-value chemicals.

Others have concentrated on sales outside of Taiwan. Chant Oil, which produces biodiesel made from waste kitchen oil, sells its product directly to European consumers. Sunho Biodiesel Corp., founded by George Chou, formerly with Taiwanese infrastructure developer CTCI Corp. and research institute ITRI, likewise is looking abroad for business opportunities, especially in Southeast Asia. “We don’t think there is a chance to do biodiesel business in Taiwan in the near future as there is no policy support,” says Felicia Boendadjaja, a technical assistant at Sunho.

Manuel Zehr, cofounder of Formosa Business Support Co., a consultancy specializing in the renewable energy sector, agrees. “There’s no future here (for biofuels) since Taiwan’s landmass is limited and gasoline is dirt cheap thanks to subsidies to CPC,” he said by email. “It makes more economic sense to grow tea plants than produce biofuel.”

Taiwan canceled its biodiesel program in 2014 after complaints from consumers that the fuel damaged their engines. Previously, Taiwan had mandated the use of B2 fuel – 98% petroleum diesel mixed with 2% biodiesel. But high humidity and the low sulfur content of conventional diesel resulted in microbial infestation of the fuel, which plugged up engines.

Taiwan does generate some electricity through biomass, but it is done by burning organic waste in incinerators.

The government is advocating the use of anaerobic “digestors” to derive methane from organic waste, with the methane then burned to drive turbines. Taipower will pay NT$2.6/kWh for power generation from biomass incineration, but NT$5.1/kWh for power from anaerobic digesters. The higher FiT, however, is not enough to overcome inertia in the sector, which remains underdeveloped.

Marine energy

The ocean is a wide frontier for renewable energy. Scientific publication World Ocean Review, in fact, says that the energy contained in the turbulence of the world’s oceans is “300 times more energy than humans are currently consuming.”

An array of technologies is being used to try to tap this energy. They range from large machines that harvest tidal power – such as the 1.2MW SeaGen tidal stream generator in the UK – to flat, thin materials that can harvest energy from the tiniest ripples on the water’s surface. Other technologies seek to harvest ocean currents and waves, while some even derive energy from the difference in salt content between freshwater and saltwater, called osmotic power.

So far, however, no cost-effective ocean energy solution has been developed.

Taiwan has excellent conditions for ocean energy, according to Tzang Shiaw-yih, professor of Harbor and River Engineering at National Taiwan Ocean University. He notes that the powerful Kuroshio Current is closer to Taiwan than it is to Japan or the Philippines.

Several companies in East Asia are seeking to tap into this potential powerful energy source, including startup Minesto. The Swedish company is applying for a permit to launch a pilot project in collaboration with National Taiwan Ocean University.

Tzang says that other research projects are also being explored, but that the sector is suffering from a lack of funding. “We need more government support,” he says. The problem is that the research efforts would only bear fruit in the long term, he explains, but “the government wants to replace nuclear power now.”