Taiwan's Goal Is Carbon Neutrality by 2050

Net carbon neutrality by midcentury “is the goal of the world and is Taiwan's goal," said President Tsai Ing-wen at a series of environmental events this week. Taiwan's position on carbon is of significance to world LNG markets as it was the fifth-largest LNG importer in the world in 2020 and remained in fifth place in the first quarter of 2021, with 4.4 million tons imported, according to Refinitiv data. “While many countries are still at the state of announcing their goals, Taiwan is already actively deploying to realize these objectives,” said President Tsai, pointing to the energy transition program begun in 2016 based on "developing green energy, increasing LNG, reducing coal and phasing out nuclear." Tsai, chair of the governing center-left Democratic Progressive Party (DPP), said her administration aimed to find “a new balance point” for the country's energy transition. This includes saving the Datan coral reefs near the nation's proposed third LNG import terminal. The fate of that terminal, and Taiwan's LNG future, depends on the outcome of a likely Aug. 28 referendum (LNGI Mar.18'21). Nuclear power, a rival to LNG in power generation, is also on the referendum ballot. Tsai pointedly declared that "Taiwan will not reverse its course” in the face of the upcoming referendum on reviving the mothballed fourth nuclear power plant project. She declared that “reviving Nuclear Four is both impossible and infeasible." Tsai said her administration was in the process of mapping out a pathway to "net zero" by 2050 and will in tandem stress dialogue with society. She urged civic and environmental organizations to work with the government to find “win-win” solutions on questions, such as the Datan coral, that involved an “environmental protection versus environment protection” dilemma. LNG's Role According to a briefing by Deputy Economic Minister Tseng Wen-sheng, decarbonizing the power system will be “decisive” in achieving the “net-zero transition” since electricity related sources account for 56.4% of total carbon emissions in 2020. Tseng said the energy transition program will promote "low carbonization" of the power supply system by developing renewable energy to replace nuclear power and increasing LNG-fueled capacity to replace sub-critical coal generators along with restructuring the power supply system and market. As of 2020, 45% of Taiwan's power output came from coal, followed by LNG with 35.7%, nuclear with 11.2% and renewables with 5.4%. Current plans are to boost LNG to 50% and renewables to 20% while reducing coal to 27% and phasing out nuclear power by 2025. Tseng related that power output using LNG fuel had risen 26% between 2016-20 and that, after reaching a peak in 2018, coal-fired power generation had declined by 4.1% in 2020 compared to 2018 (LNGI Mar.18'21). Tseng added that current plans are for additional capacity of 15.56 gigawatts along with the completion of three LNG receiving terminals, including the controversial Third LNG Terminal being built by the state-owned CPC at Guantang in Taoyuan City on Taiwan's northwest coast. Tseng said his ministry is also considering introducing differential rates for the purchase of power from cogeneration that would favor use of LNG over coal (LNGI Mar.15'21). However, Tseng expressed some uncertainty regarding the 2025 targets in the wake of Taiwan's "unique economic conditions" in the wake of the global Covid-19 crisis. Thanks in part to success in controlling the pandemic, Taiwan maintained positive real economic growth of 3.11% in 2020 and is forecast to expand by 4.64% this year powered in part by booming private investment. "These conditions are good for our economy, but present challenges to our efforts to manage power demand," Tseng acknowledged. Dennis Engbarth, Taipei