-
Chinese Taipeis Renewable Energy Development, Promotion and
Pricing Mechanism Feng-Shuo YangDirector, Research Division V
Taiwan Institute of Economic ResearchAPEC Workshop on Renewable
Energy Promotion and Pricing Mechanism 26 September 20133F The
Banquet, San Want Hotel, Taipei, Chinese Taipei
-
OutlineEnergy Supply and Demand Trends and Achievements of
Renewable Energy Development Renewable Energy Promotion Policy
Renewable Energy Pricing MechanismConclusion
*
-
Energy Supply SourcesIn 2012 indigenous energy was only 2.51%,
while percentage of imported energy reached 97.49%.Energy Supply
MixFossil energy remains as the major sources: coal (29.7%), oil
(48.0%), natural gas (12.2%) and nuclear (8.3%)Renewable energy
accounts for 1.8% of energy supply *I. Energy Supply and
Demand*
-
*Energy demand structureA. Energy consumption industrial
(38.2%), services (11.0%), residential (10.9%) and transportation
(11.9%)B. Electricity consumption industrial (52.8%), services
(19.4%), residential (17.9%) and transportation (0.5%)Industrial
sector is the largest energy consumer, therefore, structural
adjustment of the sector and promotion of energy efficiency
measures are key strategies. *Domestic energy consumption 1993~2012
(by sector)2012 Domestic energy consumption structure (by
sector)*I. Energy Supply and Demand
Chart1
7949.406
42564.758
13262.698
996.707
12280.009
12119.505
22359.288
2012
1
1993199419951996199719981999200020012002200320042005200620072008200920102011
195.73237.80316.86398.21399.20380.47390.64335.20307.26280.43234.06239.69219.93191.70144.9496.1684.7785.7095.57
318.78310.70310.19341.64364.18393.58425.07428.65476.65423.61341.22376.38394.48371.26334.71271.19275.40301.25280.88
108.53104.41104.28106.78125.96134.51146.56154.06149.03155.41147.84156.42157.67164.30227.40291.95285.46299.15308.11
9,172.379,683.9910,093.2510,360.1610,613.5311,095.1911,400.1911,617.5711,616.4012,169.5912,308.2412,770.0313,139.1813,152.7312,738.8512,112.6912,260.4912,643.8912,839.43
0.9363948077
1
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
93.64%
94.94%
()
:
2012
Energy sector self-use7949.406
Industrial sector42564.758
Transportation sector13262.698
Agricultural sector996.707
Service sector12280.009
Housing sector12119.505
Non-energy consumption22359.288
3
Chart1
5297.11323348.4339795.4111400.8545927.7667160.9946098.532
6039.14924297.99910336.8881420.0816590.027480.3366572.873
6327.10125199.66210824.5721471.5386837.5578029.1257346.997
6600.0126076.15911206.781520.9087505.1738588.397583.735
6996.26428113.24411502.8731414.3947820.3718729.6437623.15
7275.17229064.50612003.7511213.618551.9659982.588231.855
7434.49231082.16412362.4641243.6079055.09410251.7238552.379
7942.09834289.21612535.4811390.9479867.61810744.5419434.644
8172.49533802.64512549.3371408.98110155.86210829.44313987.326
7938.55536155.6913029.0321435.07810612.32911192.98514628.62
8220.12436727.86613031.3571579.66611129.25611446.22216569.65
8508.97138412.34813542.5181656.73811641.07411583.24417447.523
8987.05638821.28113911.2621527.0812224.84612269.32717117.415
9073.60240398.87613879.9871204.81512635.57412272.08917585.502
8845.34842085.3813445.9071003.88112553.24312341.97421986.716
8115.65840450.86312771.9871103.11712610.07812285.52421727.531
7802.49837662.98512906.119961.61812172.73612255.26723006.746
8097.90142091.16913329.983943.64412476.60812248.42424198.078
8078.02943160.56613523.997967.28912378.67712487.83321321.968
7949.40642564.75813262.698996.70712280.00912119.50522359.288
Energy sector self-use
Industrial sector
Transportation sector
Agricultural sector
Service sector
Housing sector
Non-energy consumption
103 KLOE
1
1993199419951996199719981999200020012002200320042005200620072008200920102011
195.73237.80316.86398.21399.20380.47390.64335.20307.26280.43234.06239.69219.93191.70144.9496.1684.7785.7095.57
318.78310.70310.19341.64364.18393.58425.07428.65476.65423.61341.22376.38394.48371.26334.71271.19275.40301.25280.88
108.53104.41104.28106.78125.96134.51146.56154.06149.03155.41147.84156.42157.67164.30227.40291.95285.46299.15308.11
9,172.379,683.9910,093.2510,360.1610,613.5311,095.1911,400.1911,617.5711,616.4012,169.5912,308.2412,770.0313,139.1813,152.7312,738.8512,112.6912,260.4912,643.8912,839.43
0.9363948077
1
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
0000
93.64%
94.94%
()
:
19931994199519961997199819992000200120022003200420052006200720082009201020112012
Energy sector
self-use5,297.116,039.156,327.106,600.016,996.267,275.177,434.497,942.108,172.507,938.568,220.128,508.978,987.069,073.608,845.358,115.667,802.508,097.908,078.037949.406
Industrial
sector23,348.4324,298.0025,199.6626,076.1628,113.2429,064.5131,082.1634,289.2233,802.6536,155.6936,727.8738,412.3538,821.2840,398.8842,085.3840,450.8637,662.9942,091.1743,160.5742564.758
Transportation
sector9,795.4110,336.8910,824.5711,206.7811,502.8712,003.7512,362.4612,535.4812,549.3413,029.0313,031.3613,542.5213,911.2613,879.9913,445.9112,771.9912,906.1213,329.9813,524.0013262.698
Agricultural
sector1,400.851,420.081,471.541,520.911,414.391,213.611,243.611,390.951,408.981,435.081,579.671,656.741,527.081,204.821,003.881,103.12961.62943.64967.29996.707
Service
sector5,927.776,590.026,837.567,505.177,820.378,551.979,055.099,867.6210,155.8610,612.3311,129.2611,641.0712,224.8512,635.5712,553.2412,610.0812,172.7412,476.6112,378.6812280.009
Housing
sector7,160.997,480.348,029.138,588.398,729.649,982.5810,251.7210,744.5410,829.4411,192.9911,446.2211,583.2412,269.3312,272.0912,341.9712,285.5212,255.2712,248.4212,487.8312119.505
Non-energy
consumption6,098.536,572.877,347.007,583.747,623.158,231.868,552.389,434.6413,987.3314,628.6216,569.6517,447.5217,117.4217,585.5021,986.7221,727.5323,006.7524,198.0821,321.9722359.288
()
0000000
0000000
0000000
0000000
0000000
0000000
0000000
0000000
0000000
0000000
0000000
0000000
0000000
0000000
0000000
0000000
0000000
0000000
0000000
3
0
0
0
0
0
0
0
2011
2011()
-
*%103 MW5-year renewable energy demonstration plan was
promoted2nd National EnergyConference conclusion:to formulate
specific act forrenewable energyPromulgation of the Renewable
Energy Development ActThousand Wind Turbines and Million Solar
Rooftop PVs ProjectAdoption of bidding mechanism for Solar PV
Completion date as thebasis for solar PV tariffII. Trends and
Achievements of Renewable Energy DevelopmentThe Installed capacity
of Renewable EnergyThe percentage of Renewable Energy of power
supplying
-
Ocean and geothermal energy: developingCumulative installed
capacity of renewable energy (2013.05)1. As of the end of May 2013,
cumulative installed capacity of renewable energy is approximately
3,748.9 MW, 7.7% as of total power system. 2. Total installed area
of solar water heating system is 2.27 million m2 (estimated 500,000
household installed, penetration rate 3.63%), installation density
is 5th in the world (2008).3. Comprehensive supply of biodiesel B2,
with annual usage of 100,000 kiloliters.4. Promotion
Achievement1998~2009: average annual increase of installed capacity
of renewable energy power generation is 88.7 MW.2010~2012: average
annual increase of installed capacity of renewable energy power
generation is 132.0 MW.Installed capacity of solar PV has grown 23
times after Renewable Energy Development Act passed in 2009.
*HydroBiomassWind powerSolar PVII. Trends and Achievements of
Renewable Energy Development
-
2nd National Energy Conference conclusion: formulate specific
renewable energy act Renewable Energy Development Act was
promulgated in July 2009. Feed-in tariff for renewable energy was
adopted. The installation of solar PV system in public buildings
was subsidized in Economic Revitalization Policy and 6% renewable
energy use in public building was promotedNSTPE announced to
enhance R&D on renewable energy technology in next 5 years.
5-year renewable energy demonstration plan promoted by MOEA,
include subsidies for wind power generation and solar
PV19982000200520091st National Energy Conference conclusion:
renewable energy development 2010Comprehensive use of B2
dieselSubsidiary acts of Renewable Energy Development Act was
passed, and FIT for renewable energy was started to operate.
Promote gasohol project in Taipei and Kaohsiungmetropolitan
area2011Thousand Wind Turbines and Million Solar Rooftop PVs
Project was approved by Executive Yuan, and the project office was
set up. 20122013New energy policy Framework aims to ensure nuclear
safety, promote green and low carbon environment, and gradually
move towards a nuclear-free society. 1. The Evolution of Renewable
Energy PromotionIII. Renewable Energy Promotion Policy*
-
*2. Renewable Energy Promotion TargetPlanning principlesMature
and feasible technology Cost-orientedBalanced development
phasesAcceptable impact of power price Driving domestic industrial
developmentResults of planWind powerPromote Thousand Wind Turbines
project (2) Offshore after onshore Solar PVs(1) Promote Million
Solar Rooftop PVs project(2) Gradual expansion; ground-mounted
after rooftopBiomass(1)Waste-to energy: transformation of existing
municipal waste incineration plants into biomass energy
centers(2)Biomass power: better use of existing agricultural
wastes, and biogas from waste (sewage) treatment
plants(3)Biodiesel: comprehensive use of B2
biodieselGeothermalSuperficial geothermal energy exploration then
deep thermal technology developmentHydro powerDeveloped by Taipower
company and private power enterprises
Ocean powerR&D of ocean power systemPioneer demonstration
project to attract the participation of private sectorIII.
Renewable Energy Promotion Policy
-
*(1) Target Expansion and Overall Development StrategyDue to the
geographical environment and natural resource limitations, The
renewable energy with matured technology and low power generation
costs will have priority in government development policy.
Moreover, the authorities will encourage the industry players to
consolidate their R&D and manufacturing capabilities. Thus,
Chinese Taipei can be one of the Green Power Exporting
countries.(2) Target of the Promotion of Renewable EnergyAccording
to the Renewable Energy Development Act, the target of renewable
energy installation shall increase up to 6,500MW for 20 years. To
correspond with the upcoming goals for GHG reduction, energy
diversification, and renewable energy expansion, the renewable
energy installation target is revised to reach 9,952MW by 2025, and
12,502MW by 2030 (i.e. meet the target of increasing 6,500 MW in 20
years 5 years earlier). In other words, more aggressive targets are
set for developing renewable energy in Chinese Taipei.2. Renewable
Energy Promotion TargetIII. Renewable Energy Promotion Policy
-
(3) Aggressive Installation Capacity Targets To prompt the solar
PV and offshore wind power, we also approve the Million Solar
Rooftop PVs and Thousand Wind Turbines Promotion project. The goal
of project will be conducted to reach the goal of installing 3,100
MW of PV systems by 2030 and 1,000 wind turbine ( including 450
onshore and 600 offshore wind turbine) .III. Renewable Energy
Promotion Policy*
Installed capacity of expanded promotion target (MW)YearEnergy
type20102015202020252030Land wind4768711,2001,2001,200Offshore
wind0156001,8003,000Hydro1,9772,0892,1382,5022,502Solar
PVs215521,3002,5003,100Geothermal0466150200Biogas2529293131Wastes8008489251,3691,369Ocean0130200600Fuel
cell0760200500Total3,2994,4166,3489,95212,502Percentage of
renewable energy of annual installed
capacity8.1%10.3%11.1%14.8%16.1%Compared with installed capacity in
20101(base)1.341.923.023.79
-
(1) Solar PV: Million Solar Rooftop PVs projectA. Promotion
strategies: gradual expansion, rooftop first then ground mounted.B.
Promoting measures: coordination and mutual support between central
and local governments, procedure simplification and deregulation,
financing environment for market mechanism. Introduction of PV-ESCO
combined with available financing to reduce the burden of the
installers. C. Overall objective: cumulative installed capacity
reaching 2,500MW by 2025, 3,100MW by 2030 (RF 3,000MW and GM
100MW).(2) Wind Power: Thousand Wind Turbines projectA. Accelerate
Onshore promotion: 1,200 MW (about 450 units) completed by 2020.B.
Offshore demonstration incentive: 4 demonstration units completed
by 2015. 600MW wind farm (about 120-180 units) completed by 2020.
C. Offshore development block: annual increase of offshore wind
farm of 240MW. 2,400MW completed in next 10 years.D. Overall
objective: 3,000 MW of offshore wind farm completed by 2030.
4,200MW of total wind farm completed by 2030.*3. New Energy Policy
Framework (2011.110.03)III. Renewable Energy Promotion Policy
-
(3) Biomass powerA. Coordinating with FIT for renewable energy
and MOEA Biogas Power Generation System Subsidy Scheme to encourage
the industrial participation in the installation. 4 counties
(Pingtung, Tainan, Yunlin, Changhua) have submitted their
application in 2013.B. Investment in advanced fuel conversion
technology (e.g. biomass pyrolysis oil, firing technique),
diversification of biofuel sources and improvement of fuel quality.
C. Short-term objective: 877MW by 2015. D. Long-term objective:
1,400MW and 3.42% of total power generation completed by 2025. (4)
Ocean powerA. Short-term objective: demonstration of MW grade power
plant completed by 2015 and development of commercial power plant
(30MW) started from 2020.B. Long-term objective: 200MW and 0.24% of
total power generation by 2025.III. Renewable Energy Promotion
Policy3. New Energy Policy Framework (2011.110.03)*
-
*(5) Geothermal powerA. Development strategy: from shallow to
deep ground (EGS).B. Coordinating with FIT for renewable energy and
MOEA Biogas Power Generation System Subsidy Scheme to encourage the
industrial participation in the installation. In December 2012, a
demonstration project of 50kW enhanced dual cycle geothermal power
generation system with autonomous technology was built in Qingshui,
Yilan county. C. Short-term objective: 1 MW
Renovate-Operate-Transfer (ROT) Qingshui project completed in 2013.
23MW in Qingshui area completed by 2018. D. Long-term objective:
100MW in Datun Mountain area and 0.24% of total power generation
completed by 2025. 3. New Energy Policy Framework (2011.110.03)III.
Renewable Energy Promotion Policy
-
*4. Renewable Energy Development Act (23 articles)Promotion
target, mandatory grid interconnection and power purchasing
obligations, FIT for different renewable energy with reasonable
profits, and development fund for subsidies are four pillars of CTs
power purchasing system. FIT mechanism is the core. III. Renewable
Energy Promotion Policy
-
(1) Feed-in Tariff Rate *Every year, Renewable Energy Feed-in
Tariff Rate Review Committee will review the technical improvement,
cost change, achieved target and relate factors of each type of
renewable energy to examine Feed-in Tariff Rate and calculation
formula. * To secure reasonable investment return for the industry,
renewable electricity generated by the industry and the public will
be fully purchased with fixed rate for 20 years, with WACC rate of
5.25% (discount rate). *4. Renewable Energy Development
ActRenewable energy power-purchasing systemRate-setting reviewShare
the initial risk of IndustryFixed Feed-in Tariff, FITDeliberate the
suggestions from industryIII. Renewable Energy Promotion Policy
-
(2)Set up Promotion target The Renewable Energy Development Act
is aimed to increase dramatically CTs renewable energy use in the
next 20 years. *Concrete target of installed capacity: 9,952 MW by
2025 12,502MW by 2030(3)Set up renewable energy development fundThe
establishment of renewable energy development fund is aimed to
internalize the external cost of traditional fossil fuel. * Power
enterprises are required to pay the fund for power generation from
non-renewables. * Upon approval, the amount paid to the fund can be
reflected in the power price to meet the principles of
users/polluters charge. *4. Renewable Energy Development ActIII.
Renewable Energy Promotion Policy
-
(4) Elimination of development restrictionRelated acts and laws
have been amended in coordination with REDA*4. Renewable Energy
Development ActIII. Renewable Energy Promotion Policy
RegulationPurposeContentElectric regulationsAmendment of
Electricity Act and related regulationsElectricity Act, Electricity
Registration Regulation, Self-Use Power Generation Equipment
Registration RegulationLand Act Building ActReduce barriers of
renewable energy equipment installationExemption of miscellaneous
license for renewable energy equipment installation, non-urban land
registration changesAdministrative orders related to renewable
energy equipmentIdentification and bidding system for renewable
energy equipmentRenewable energy power generation system
installation administration, renewable energy power generation
facility demonstration incentive scheme, import tax exemption of
renewable energy power generation equipment, solar PV power
generation bidding procedureTaipower regulationTaipower
responseTaipower renewable energy power generation grid
interconnection rule
-
(5) Grid interconnection and power purchasing obligationPower
enterprise is obliged to purchase power generated from renewables
and to provide grid interconnection. (6) Demonstration
subsidyRenewable energy with development potentials are entitled to
receive subsidies for a period in the initial development stage.
Currently demonstration projects of offshore wind power, geothermal
and methane gas can receive subsidies. (7) Other supporting
measuresOther promotional measures include duty exemption of
imported renewable energy power generation equipment, deregulation
of related acts, and specific offices for each type of renewable
energy. *4. Renewable Energy Development ActIII. Renewable Energy
Promotion Policy
-
Financial Mechanism of the Act Renewable Energy Development Fund
(Article 7)Provide for the funding sources needed and purposes of
use for developing renewable energy Feedin tariffs (Article
9)Constitute a committee for stipulating the buy wholesale rate and
formula of calculation for power generated by renewable energy
facilities Subsidy (Article 10)Subsidize power utilities for
purchasing or selfuse generating of renewable electricity Rewarded
demonstration (Article 11)Be reward for renewable energy facilities
with potentiality in an early stages of technical development
Incentives to thermal applications (Article 13)Subsidize thermal
applications of solar energy and biofuels *4. Renewable Energy
Development ActIII. Renewable Energy Promotion Policy
-
1. Power Purchasing Mechanism for Renewable Energy(1)
Characteristics*Adoption of FIT system*Renewable energy power are
guaranteed to be purchased with a preferential rate in a 20 period
Basic ideaRenewable energy power generation facility
installerTaipowerCompanyUserElectriccurrentCashflowCharacteristics1.Fixed
tariff over 20 years period enable the industry to control cash
flow of each stage, facilitating investment decision planning and
reducing operational risks. 2.Adoption mode of energy rate and cost
benchmarking to encourage regions with competitive renewable energy
resources and enterprises with better operational efficiency to
enter the market with priority, and enhance the economic benefits
of renewable energy.3.FIT rate is calculated based on signing day
rate, but for Solar PV specifically, completion date rates and
bidding system is adopted, is an improved FIT system with Taiwanese
characteristicsRE Development FundElectricity surchargeSubsidy for
cost difference ElectriccurrentCashflowIV. Renewable Energy Pricing
Mechanism*
-
According to REDA: A. Central competent authority (MOEA) should
invite all relevant ministry, scholars and experts, and
organizations to form a committee, to validate the Feed-in Tariff
rate and its calculation formula of renewable energy power
generation facility. B. Tariffs and formula should be reviewed or
revised annually by referring to technical improvement, cost
change, target achievement status and related factors of each type
of renewable energy.C. Tariff shall not be lower than the average
generation cost for thermal-fired (fossil fuel) power of domestic
power utilities.*1. Power Purchasing Mechanism for Renewable Energy
(2) RE Feed-in Tariff rate Validation CommitteeIV. Renewable Energy
Pricing Mechanism
-
*1. Power Purchasing Mechanism for Renewable Energy(2) RE
Feed-in Tariff rate Validation CommitteeVice minister of MOEA as
convener invites all ministry, scholars, experts and
organizationsCommittee formationLegal basisIV. Renewable Energy
Pricing Mechanism
-
Adopts the international best practice: investment and O&M
Cost + Reasonable rate of return, to reflect the capital cost and
investment risk to ensure a reasonable profit return to the
investors. Feed-in Tariffs are fixed tariff payments over a long
operating period (20 years) based on actual power sold. In
principle, the FIT rates must Renewable energy resources that are
locally abundant and operate with high economic efficiency are
prioritized.
1. Power Purchasing Mechanism for Renewable Energy (3)
Calculation formula of Feed-in Tariff rateIV. Renewable Energy
Pricing Mechanism*
-
A. According to REDA: Technical improvement, cost change, target
achievement and related factors of each type of renewable energy
will be reviewed or revised annually.B. Current Feed-in Tariff
calculation parameter for renewable energy power is as follows:*1.
Power Purchasing Mechanism for Renewable Energy (4) Calculation
parameter and contentIV. Renewable Energy Pricing Mechanism
ItemParameterContent(1)Initial installation costTotal initial
investment capital(2)Annual O&M costAve. annual related O&M
costs in 20 years(3) Annual electricity saleAve. annual electricity
sale(4)Purchasing periodElectricity purchasing period (operation
years of facility)(5)WACCTime value of money invested
-
*(2)A. Feed-in Tariff except solar PV*(LVRT)2.5924/(1012.5971/)
1. Power Purchasing Mechanism for Renewable Energy (5) Current
Feed-in Tariff rate of renewable energy powerIV. Renewable Energy
Pricing Mechanism
Type of renewable energycategorylevel (kW)2012 rates
(NTD/kWh)2013 rates (NTD/kWh)Change rate (%)Wind powerOnshore1~
-
*1. Power Purchasing Mechanism for Renewable Energy (5) Current
Feed-in Tariff rate of renewable energy powerB. Feed-in Tariff for
solar PVIV. Renewable Energy Pricing Mechanism
TypecategoryLevel(kW)Ceiling rates for 1st period 2012
(NTD/kWh)Ceiling rates for 2nd period 2012 (NTD/kWh)Ceiling rates
for 1st period 2013 (NTD/kWh)Ceiling rates for 2nd period 2013
(NTD/kWh)1st period change (%)2nd period change (%)Solar
PVRooftop1~
-
(1) Origins of biddingConsidering short construction period and
reduced set-up costs due to rapid technical progress, completion
date rates and bidding system was discussed and adopted in 2011 to
avoid delay in construction work of the enterprises seeking excess
profits.According to REDA and subsidiary acts, the bidding system
aims to truly reflect cost changes of solar PV installation through
market mechanism, making the FIT for solar PV more fair, reasonable
and effective. Supporting measures of bidding mechanism(A) Bidding
quota is set up for each period. (B) FIT for solar PV is regarded
as Ceiling rate of the bidding price. (C) Submission discount rate
as quotation of the bidding. The rate of the winner is ceiling rate
announced at completion date(1-discount rate).*2. Solar PVs bidding
mechanismIV. Renewable Energy Pricing Mechanism
-
(2) Subjects suitable for bidding*2. Solar PVs bidding
mechanismIV. Renewable Energy Pricing Mechanism
201120122013Suitable1. Rooftop installation of non-residential
owner from 1kW~10kW1. Rooftop installation from 30 kW ~ 5 MW.1.
Rooftop installation from 30 kW ~ 5 MW.2. Rooftop installation over
10 kW.2. Ground-mounted installation from 1 kW~1MW.2.
Ground-mounted installation from 1 kW~1MW.3. Ground-mounted
installation from 1 kW~1MW.Unsuitable1. Government building with
mandatory installation 6% of green energy facilities1. Rooftop
installation from 1 kW~30 kW.1. Rooftop installation from 1 kW~30
kW.2. Installations that received subsidy from MOEA or BOE in the
past.2.Government agencies or state-owned enterprises
installations2. Installation for buildings owned or managed by
government and public schools.3. Installations that received
subsidy from MOEA or BOE in the past.3. Private installations of
the rented public buildings approved by local government with
accumulated approved capacity under 3MW4.State-owned agency
installations which at the time applicable of this provision,
cumulative approved capacity under 5MW.5. Installations that
received subsidy from MOEA or BOE in the past
-
A. Peru is implementing bidding system respectively in 2008 and
2010. Bidding subjects were biomass, wind power, solar and small
hydro.B. To develop Solar PVs, India has included 5-20MW into the
bidding mechanism, and specified that each bidder can bid a maximum
of 50MW. Also, solar heating is also purchased through bidding.C.
French government promulgated an administrative order on Mar 2011
to solve the excessive solar PV applications through setting a
maximum capacity and bidding operations. On Feb 2012 the bidding
for offshore wind power has begun.D. In Jan 2013, Italy begun to
implement a new renewable energy purchasing system. Bidding
mechanism was applied to certain levels of renewable energy
including onshore and offshore wind power, hydro, geothermal and
biomass.E. Thailand: wind, solar, small hydro and biomass.F.
Brazil: small hydro, wind power, biomass (bagasse cogeneration)G.
China: onshore and offshore wind power, and solar PVs.(3)
International applicationInternationally, bidding system is mainly
applied to solar and wind power*2. Solar PVs bidding mechanismIV.
Renewable Energy Pricing Mechanism
-
An estimated amount of 561.41 million NTD saved from renewable
energy development fund over 20 years (on average 28.07 million NTD
saved annually) as a result of implementing the 2012 Solar PV
Bidding Mechanism.*(4) Benefits from the 2012 Solar PV Bidding
Scheme2. Solar PVs bidding mechanismIV. Renewable Energy Pricing
Mechanism
typeRangeCeiling FIT Rate(A)Awarded Bid Total Capacity(kW)Ave.
Bid Award discount RateEffective FIT RateBRate difference(A-B)Monet
saved (NTD)1st 2nd 1st 2nd 1st 2nd 1st 2nd 1st 2nd
Roof-top30kW~100kW 8.53948.3259 3,6517,0802.09%3.33%8.3608 8.0488
0.1786 0.2771 6,535,000100kW~500kW8.18367.9701
19,78042,7293.25%3.73%7.9178 7.6732 0.2658 0.2969
44,860,000>500kW7.32977.1873 9,899 -2.28%-7.1626 7.18730.1671
04,136,000Subtotal)33,330
49,809---55,530,000Ground-mountedN/A6.90276.7604
1689093.01%3.41%6.6949 6.5299 0.2078 0.2305 611,000Total-33,498
50,718---56,141,000
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*Purpose of Renewable Energy Development FundSubsidy for
renewable energy power pricesSubsidy for renewable energy
equipmentDemonstration incentive and promoting the utilization of
renewable energyOther uses related to renewable energy development
approved by the central competent authoritySources of Renewable
Energy Development FundOver a certain installed capacity Government
funding through budget processInterest income from the FundOther
related incomesFunders with certain installed capacityTaipower
CompanyPrivate-owned power generation enterprisesIndustry with
self-use power generation equipment installed3. Renewable Energy
Development FundIV. Renewable Energy Pricing Mechanism
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3. Renewable Energy Development FundOperational process of
Renewable Energy Development Fund--income based on expected
expenses to balance revenue and expenditure--*consumerPrivate power
enterprises,IPPsFundTaipower Company
Self-use power generation equipment with certain capacityFossil
energyPower gridRenewable energy power generation
installersurchargesurchargesurchargePaymentpaymentpaymentGrid
interconnection and power purchaseEquipment subsidyCost difference
subsidyIV. Renewable Energy Pricing Mechanism
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*3. Renewable Energy Development FundIV. Renewable Energy
Pricing Mechanism
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1. Renewable Energy Development Act is the foundation Act for
promoting renewable energy. By the end of 2012, total installed
capacity of renewable energy increase approximately 551MW, reaching
3,697MW, installed capacity accounted for 6.8%.As for promotion
targets, CTs currently uses total installed capacity as basis. It
is targeted to reach total installed capacity of renewable energy
of 12,502MW by 2030, accounting for 16.1% of total power installed
capacity. Thousand Wind Turbines and Million Solar Rooftop PVs
project is the main policy to promote Solar PV and wind
power.Regarding promotion policy, currently main core mechanism is
FIT, and the Renewable Energy Development Fund is used to pay for
the wholesale renewable power. Since the cost of solar PV has
declined rapidly in recent years, to reflect exact costs and
encourage companies to complete work as soon as possible, rate
applicable on the basis of completion date in coordination with
bidding mechanism is adopted, and double phase rate is announced
within each year as supporting measures. CTs electricity market is
slowly reforming to become more liberalized, and by reflecting the
true cost of energy, in the long term as conventional energy prices
rise, renewable energy will be a key factor to bring prices
down.*V. Conclusion
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**Your comments are welcome!
***