Is Taiwan sleepwalking into an energy crisis?

"Are you sure the Chinese Communist Party isn't behind the anti-nuclear movement in Taiwan?" That's the question I get over and over again as I explain Taiwan's seemingly inexplicable decision to close its last nuclear power reactors in the face of a possible energy blockade.

Unfortunately, the aversion to nuclear power is entirely home-grown with no help from the Chinese. It goes against not just our stated efforts to reach Net Zero by 2050 but threatens our very survival as a nation.

Former Trump administration Defense Official Elbridge Colby is worried about an energy blockade. Why isn't the DPP?

Taiwan's energy mix is highly dependent on fossil fuels right now, with coal and Liquified Natural Gas (LNG) both taking about 40% of the mix. Due to the complex infrastructure involved with receiving LNG, we take just about daily shipments and a "full tank of gas" lasts less than 8 day in the summer. Coal is better, with about 6 week's supply at hand. But the goal is for coal to decrease and nuclear generation to go away altogether, leaving Taiwan with 50% LNG by 2025.

Lately, the "Hellscape" scenario outlined by head of INDOPACOM Adm. Samuel Paparo have been making the news. In that scenario, the US unleashes a furious storm of drones into the Taiwan Straits with the aim of delaying Chinese invasion forces until the calvalry can arrive. How long might that be? Paparo estimated 45 days. That's a long time for Taiwan to go without LNG shipments and I doubt any superchilled tankers would be up for braving the "hellscape" that the Taiwan straits would be turned into to make deliveries.

Taiwan has just 2 nuclear reactors left, both at the Maanshan Nuclear Power Plant. They are slated to close in July and next year respectively. Two reactors alone produce 6% of Taiwan's power, which doesn't seem like much but is more than solar at less than 5% and just under triple that of wind at 2.2%. More importantly, Taiwan's grid is already strained, with industry regularly "voluntold" to reduce production during peak hours in the summertime months. Losing that baseload could mean a further fragilization of our grid and sap competitiveness for industry.

As for the Net Zero by 2050 goal, our Environment Minister have already admitted to the press that it's aspirational rather than a concrete target. But the government is still determined to press ahead with the closures of the plants.

Standing up to get slapped down

It's not that there are not voices within the ruling Democratic Progressive Party (DPP) who sees necessity of nuclear energy for Taiwan's future. In fact, President Lai Ching-te has elevated figures from private industry such as the Minister of Economic Affairs JW Guo and head of National Development Council Paul Liu who each made encouraging statements about life extension not just for Maanshan but to bring back the idled 2nd Nuclear Power Plant at Kuosheng, which also hosts two Gigawatt-scale reactors.

Unfortunately after each of their statements, they would be spanked into line by other, more senior, DPP politicos, such as the Premier Cho Jun-tai, who said "The No Nuclear Homeland, that is a value. It's like, if we lose our values, life would lose meaning."

Nevertheless, voices of sanity keep piping up.

"Taiwan is going backwards not forwards when it comes to green energy. The reason our energy policy is stuck is because of the 'No Nuclear Homeland' policy. Our carbon emissions keep going up, yet somehow we still feel good about ourselves. We are coming in close to dead last while we tell ourselves we're doing just great. In my opinion, Taiwan is in a state of collective sleepwalking."

The above sounds like exactly what I would say in any of the op-ed pieces I've published in various Taiwanese outlets. But the message lands much harder because of who said it: Chairman TH Tung of Taiwanese tech-giant Pegatron. More importantly in this context, he is also one of the deputy conveners of President Lai Ching-te's new National Climate Change Response Committee. He even says that higher-ups at TSMC is privately in support of his proposals, although he fails to name specific names.

Tung is more aggressive than either Guo or Liu. He is calling for a "golden ratio" of 30% nuclear, 30% renewables and 40% "fuels which could be replaced by hydrogen in the future if technology allows" (translation: fossils). This implies the building of new nuclear power plants as turning on every existing reactor in Taiwan would only get us to around 18% nuclear power on the grid.

Would this go anywhere, or would Tung also get crushed in turn?

What I'm seeing is all the Biz-oriented folks president Lai has been bringing into government trying to course-correct on nuclear getting bullied and shouted down by the DPP's anti-nuclear old guard.

Chairman Tung is completely correct: Taiwan is sleepwalking on this issue and in denial. If Lai is actually antinuclear himself he wouldn't keep putting up these voices of reason in prominent positions. But why then is he not giving them the support necessary to actually prevail?

Renewables faltering

By the way, the party line on nuclear in the DPP is that we don't need it because it is being replaced by renewables. Setting aside whether stable baseload power like nuclear CAN be replaced by intermittent renewables on a 1-1 basis, the problem is the development of our renewable energy resources is also at-risk under the current administration.

In a farewell post on LinkedIn, Managing Director of Taiwan Sean McDermott of Canada's Northland Power gives a stern warning that Taiwan's upcoming offshore wind development could collapse:

"Round 3 is struggling to gain momentum, and the government seems either unable or unwilling to change direction on some of the most problematic elements of the regime. The Round 3 dilemma is simple: risk is high and reward is low. As a consequence, many of the world's largest suppliers and developers are leaving Taiwan; most won't come back."

This is in fact a problem that has been well-understood within the industry: because the DPP government asked for exceptionally heavy local content requirements, it is no longer profitable to build offshore wind farms in Taiwan. But with solar already getting very mature due to land-use restraints, offshore wind is supposed to be THE bulk source of renewables available to Taiwan to try and plug the nuclear gap.

Back in the 1980s, Taipower had a 20-year rolling power generation forecast. They created their strategy balancing fuel availability, stability, demand, security and cost. Now it's clear it's politics that's in command and instead of complex long-range forecasts, Taiwan is just winging it.

I've been told that I focus too much on energy, but in truth energy is such an important topic that if an administration is failing to address it, I don't trust that administration. But everywhere I look in energy, whether its defense considerations, the stubborn insistance on the nuclear phaseout or the stalled renewables buildout, I don't see planning. Just like Chairman Tung, I see sleepwalking.