Renewable targets have not been reached, and resumption of nuclear energy use appears increasingly likely.

Taiwan President Lai Ching-te has long signaled a willingness to reconsider the island’s nuclear phaseout, a policy shaped in a less precarious geopolitical era.

By late March, as the war involving Iran tightened energy markets, that shift moved from suggestion to action. Lai said that state-owned Taiwan Power Co. (Taipower), the island’s main electricity provider, would submit proposals to the Nuclear Safety Commission by month’s end to restart the mothballed Kuosheng and Maanshan nuclear power plants.

According to Taiwan’s Ministry of Economic Affairs, Maanshan could resume operations as early as 2028.

In explaining his administration’s pivot on nuclear energy, Lai said that Taiwan “has entered a new strategic landscape” characterized by three key factors. First, significant economic expansion — particularly the establishment of high-performance computing centers to support the AI industry — has generated higher-than-expected electricity demand. Second, the European Union has implemented the Carbon Border Adjustment Mechanism (CBAM), requiring products imported into the EU in the future to comply with low-carbon or carbon-neutral standards. Third, “in light of shifting geopolitical dynamics, Taiwan must prioritize and enhance its energy resilience,” he said.

Analysts say the knock-on effects from the Iran war, which has seen Tehran disrupt energy transit routes and destroy Qatar’s liquefied natural gas (LNG) production capabilities, have brought Taiwan’s energy vulnerabilities to the fore. Taiwan sources 97% of its energy from overseas, mostly natural gas and coal. About 70% of its oil and 38% of its natural gas come from the Middle East.

Taiwan keeps roughly 150 days of oil reserves, but only about 11 days of spare LNG.

“Over the longer term, this energy shock serves as an urgent reminder that Taiwan should expedite its renewables build-out and promptly commit to restarting its nuclear power plants to alleviate its overreliance on fossil fuel imports,” the Atlantic Council, a Washington, D.C.-based think tank, said in a March research note.

Missed renewable energy target

As export-oriented industries adapt to new sustainability requirements, access to low-carbon electricity is becoming a competitive necessity rather than a policy aspiration. At the same time, demand for renewable energy is increasingly being shaped by corporate commitments. Multinational companies operating in Taiwan, particularly in the technology sector, are bound by RE100 and similar global initiatives requiring them to source 100% renewable electricity. Meeting those requirements is becoming a factor in investment decisions, adding pressure on Taiwan to accelerate deployment and expand access to corporate power purchase agreements.

Taiwan has made steady gains in expanding renewable energy, but it has yet to meet the 20% target set in 2017. The goal was originally tied to 2025, then deferred to 2026. That deadline now also appears out of reach.

The government has sought to strengthen coordination through the National Climate Change Committee, chaired by President Lai, which held its sixth meeting in January. The committee has been positioned as a central platform for aligning policy across ministries, with a focus on balancing emissions reduction, industrial competitiveness, and energy security. Recent discussions have included the implementation of Taiwan’s carbon fee system, exploration of a pilot emissions trading mechanism, and efforts to align with international frameworks such as CBAM.

Renewables currently account for about 11% to 12% of Taiwan’s energy mix. Progress has been slowed by bottlenecks in solar development, tighter environmental reviews, and delays in offshore wind projects.

While the climate change committee reflects a more integrated approach to climate governance, analysts caution that Taiwan’s primary challenge lies less in policy design than in execution of policy. Several setbacks have stemmed from policy decisions within Taiwan’s control. Amendments to the Renewable Energy Development Act in 2019, 2023, and 2025 “create uncertainty for industry,” says Ross Feingold, a Taipei-based lawyer and political risk analyst.

In offshore wind, repeated changes — and reversals — to local content requirements have complicated project planning. In solar, two opposition parties in the Legislative Yuan moved in November 2025 to tighten environmental oversight by revising the Environmental Impact Assessment Act, the Act for the Development of Tourism, and the Geology Act. The changes followed incidents in which solar panels became debris during severe storms. Industry groups and the Lai administration have criticized the revisions, even as developers continue to adjust to a shifting legal and regulatory landscape.

Rupert Hammond-Chambers, president of the U.S.-Taiwan Business Council, noted in a January commentary published by the Taipei Times that renewable energy companies have struggled to navigate Taiwan’s complex domestic politics. He said that “renewable energy companies appear to have become prime targets for partisan rancor, creating significant uncertainties and unforeseen risks for investors in this sector. That is going to have a negative longer-term impact on public-private efforts to expand and modernize Taiwan’s power generation and grid.”

Some external factors have delayed renewable energy progress in Taiwan, notably in offshore wind. These include raw materials shortages, price fluctuations for critical minerals, and the shortage of the specialized ships required for installation. “These issues are beyond Taiwan’s control,” Feingold says.

Taiwan’s limited land availability presents an additional structural constraint. Utility-scale solar projects must compete with agriculture, conservation priorities, and urban development, while mountainous terrain further reduces suitable sites. Offshore wind offers greater potential, but projects are capital-intensive and dependent on complex marine logistics, making deployment slower and more vulnerable to global supply chain disruptions.

Michael Cunningham, a senior fellow at the Stimson Center in Washington, D.C., says structural economic factors could also limit Taiwan’s adoption of green energy. “As long as Taiwan continues to produce the world’s semiconductors, the growth of its energy demand is going to outpace its growth in renewables,” he says.

Taiwan aims to transform itself into a global AI hub by 2040, which will further strain an electricity grid already struggling with the energy-intensive manufacturing sector’s massive demand.

“The gap is widening between Taiwan’s AI ambitions and its energy preparedness,” the Center for Asia-Pacific Resilience and Innovation (CAPRI), a Taipei-based non-profit, said in a March research note.

CAPRI further notes that solar and wind power remain inherently intermittent. “Until Taiwan has mature, large-scale, long-duration energy storage solutions, renewables cannot reliably power an NVIDIA H200 or Blackwell-class cluster [high-performance graphics processing units used in AI] through the night,” the non-profit said.

Pursuing energy security

Given Taiwan’s heavy reliance on imported energy, analysts say it is critical to continue scaling mature renewable sources such as offshore wind and solar photovoltaics, while also pursuing deep energy efficiency measures to curb demand and diversifying generation to expand supply. Together, these steps can help reduce the carbon intensity of electricity.

In parallel, investments in behind-the-meter energy storage, fuel cells, and grid resilience can strengthen the system’s overall reliability.

In the medium to long term, investment in technologies emerging in Taiwan’s ecosystem — including perovskite–silicon tandem solar cells, floating offshore wind, and geothermal energy — could improve the efficiency of Taiwan’s limited land use, say Chihlun Chen and Yifang Wang, a consultant and an analyst at the semi-governmental Market Intelligence & Consulting Institute. “At the same time, this would enable Taiwan to capture emerging market opportunities associated with the replacement of aging wind and solar power equipment,” they told TOPICS in emailed responses.

For more forward-looking options such as next-generation nuclear energy and hydrogen, “there is scope for Taiwan to further examine international regulatory frameworks, policy developments, and technological trends,” Chen and Wang say. They recommend that Taiwan engage with countries with technological capabilities in these areas, such as Japan and South Korea, as well as those with “strong related resource potential,” such as Australia and Saudi Arabia.

This approach could gradually facilitate the development of supply chains, demonstration sites, and a regulatory sandbox, which could “allow for more timely adoption once domestic conditions mature,” they add.

Meanwhile, resuming the use of nuclear power — while potentially beneficial for Taiwan’s energy resilience — remains politically fraught. The Stimson Center’s Cunningham notes that Lai still has avenues that could preserve political capital while helping meet the island’s energy needs.

“The emergence of new technologies, such as small modular reactors, could present an opportunity for Lai to change the government’s position on nuclear energy while making the case that he hasn’t sacrificed the DPP’s core principles — the technology has just evolved. But it would still be very difficult, so we’ll have to wait and see.”