All rights reserved. No part of this confidential report may be reproduced

in any form or by any means without written permission from ITRI.

Policy and Promotion ofOffshore Wind Power in Taiwan

Thousand Wind Turbines Project

Ssu-yuan Hu / Office Manager

Thousand Wind Turbines Promotion Office

operated by Industrial Technology Research Institute

supervised by Bureau of Energy, MOEA

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2014 ITRI

Overview

Wind Resource in Taiwan

Promotion Target & Strategy

Demonstration Incentive Program

Focus of Cooperation

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2014 ITRI

Taiwan Offshore Wind Potential

Shallow Water (5-20 m) Area: 1,779.2 km2

Potential: 9 GW

Feasible: 1.2 GW

Deep Water (20-50 m) Area: 6,547 km2

Potential: 48 GW

Feasible: 5 GW

Deeper Water (> 50 m) Potential: 90 GW

Feasible: 9 GW

PacificOcean

Ref. Wind Resource Assessment Handbook, ITRI, 2011

Contour simulated by NCAR WRF 3.0 model

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Current Status of Wind Development

Onshore (by the end of Feb. 2014) State-owned: 161 WTs / 287 MW

Private: 157 WTs / 343 MW

Total: 318 WTs / 630 MW(16.3 % of all RE)

2013 Production: 1,574 MWh(14.7 % of all RE)

Offshore No offshore wind turbine

has been installed yet.

4.5 MW (3x)

3.96 MW (6x)

6 MW (3x)

15.1 MW (8x)

30 MW (20x)

12 MW (6x)

34 MW (17x)

8 MW (4x)

62 MW (31x)

23 MW (10x)

46 MW (23x)

28 MW (14x)

5.4 MW (6x)

4.8 MW (8x)

4 MW (2x)

/43.7 MW (19x)

4.6 MW (2x)

11.5 MW (5x)

1.75 MW (1x)

/14.7 MW (7x)

34 MW (16x)

16.1 MW (7x)

42 MW (21x)

/75.9 MW (33x)

/96.6 MW (42x)

2.64 MW (4x)

State-owned

Private

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Target for Wind Energy

Ref. Bureau of Energy, Ministry of Economic Affairs, TAIWAN

Thousand Wind Turbines Project Short-term Target: 4 demonstration offshore wind turbines by 2015.

Mid-term Target: Offshore 320 MW, total 1,520 MW by 2020.

Long-term Target: Offshore 3,000 MW, total 4,200 MW by 2030.

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200

400

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1,200

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1,800

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Cap

acit

y (M

W)

Year 2013 2015 2020 2025 2030MW WTs MW MW MW MW WTs

Onshore 614 311 814 1,200 1,200 1,200 450Offshore 0 0 15 320 1,520 3,000 600

Total 614 311 829 1,520 2,720 4,200 1,050

Inst

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apac

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(MW

)Tu

rbin

es

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3,600

3,000

2,400

1,800

1,200

600

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1,050

311

Installed Capacity

Turbines

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Promoting Offshore

Feed-in Tariff (FIT) Onshore: NT$2.6338 / kWh during 2014

Offshore: NT$5.6076 / kWh during 2014

Offshore Demonstration Incentive Program (DIP)

Officially announced on 3rd July, 2012

4 Demonstration Turbines by 2015, 3 Demonstration Wind Farms by 2020

Government provides subsidy for both equipment & developing processes

Zonal Development Industrial Zone for offshore wind farms (e.g. Round 3 of UK)

Commercial scale for cost down

Year 2015 2020 2030Onshore 814 1,200 1,200Offshore 15 320 3,000

Total 829 1,520 4,200

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Offshore Demonstration Incentive Program

3 Demonstration Wind Farms Winners (Fuhai, Formosa & TPC) officially announced on 9th January 2013

Subsidize 50 % cost of the Demonstration Turbines (FIT advances/interest-free loan)

Subsidize NT$250m for preparatory (wind mast, EIA, etc.) expense

Year 0(2012)

Year 1(2013)

Year 2(2014)

Year 3(2015)

Year 4(2016)

Year 5(2017)

Year 6(2018)

Year 7(2019)

Year 8(2020)

Year 9(2021)

Year 10(2022)

Proposal deadline

(Oct. 2012)

Demonstration Turbines

commissioned(Dec. 2015)

Demonstration Wind Farms

commissioned(Dec. 2020)

Plan initiation(Jul. 2012)

Proposal review

complete(Jan. 2013)

Establishment Permit

(Dec. 2014)

Construction Permit

(Dec. 2018)

Formosa

FuhaiTPC

5 m depth12 nm

territory

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Specifications & Requirement of DIP

Met Mast Water depth: 10 m or more

Height: 70 m or more

Demonstration Turbines

Capacity: at least 3 MW each

Commissioned by 2015

Demonstration Wind Farm

Water depth: 5 m or more

Capacity: 100-200 MW each

Commissioned by 2020

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Awarded Demonstration Projects

Fuhai () @Changhua Capacity: 108 MW (30 turbines)

Distance from Shore: 11 km

Water Depth: 25-40 m

Formosa () @Miaoli Capacity: 130 MW (36 turbines)

Distance from Shore: 1-5 km

Water Depth: 5-30 m

TPC () @Changhua Capacity: apprx. 108 MW (22-36 turbines)

Distance from Shore: 6-8 km

Water Depth: 15-25 m

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Investment by Developer

356501

1205

3113

5466

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1000

2000

3000

4000

5000

6000

2013 2015 2020 2025 2030

MW

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1000

2000

3000

4000

5000

6000

MW

MW

Annual Investment2013-2015: 7.3b/yr2016-2020: 14.1b/yr2021-2030: 42.6b/yr

Offshore (MW)Onshore (MW)Accumulated Investment

20302025202020152013 NT$546.6bNT$311.3bNT$120.5bNT$50.1bNT$35.6b

NT$ in

billio

n

Offshore Wind Farm Investment: NT$159m/MW

Offshore 3,000 MW by 2030 NT$480 billion investment

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Investment by Service Provider

Source: DECC

Manufacture

Fleet investment

NT$15-22.5b(100-150m/ship)

R&D investment

NT$12b(80m/GW)

Turbines (component/system/subsystem)Electric System (cable/substation)Foundation/Sub-structure

Marine Construction & InstallationO&M for Wind TurbinesFleet Supply

Construction

Source: DECC

Foundation

12.4%

Turbine

25%

O&M

37.4%

15.8%

ConstructionMisc 0.5%

Planning 2.5%

Electric System 6.4%

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Design against Environment Turbine design resistant to typhoons

Foundation design resistant to earthquakes

Environmental Impact Assessment Migrating birds & ocean mammals

Local fishery, navigation and harbor development

Project Management Risk assessment and mitigation

Vessel coordination and construction scheduling

Risk Identifications

Pictures from: Vergnet, YCPS, Centrica

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Successful Experiences of Wind Farm Development in Europe Strategy: demonstration vs commercial

EIA solutions: navigation, fishery, environmental activists

Onshore Infrastructure: design of onshore base for offshore wind farm industry

Finance & Insurance: project finance and risk management

Taiwan Offshore Demonstration Wind Farm Project Developer: general consulting, project management and financial advice

Equipment: typhoon-proof design technology

Service: marine construction and O&M

Offshore Test Wind Farm Offshore test site for new turbine technology (e.g. Hunterston or EOWDC)

International Interactions of Offshore Wind

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copyright

2014 ITRIAll rights reserved. No part of this confidential report may be reproduced

in any form or by any means without written permission from ITRI.

Thousand Wind Turbines Promotion Office

http://www.twtpo.org.tw