Contrary to expectations that Taiwan, facing the potential of a Chinese blockade, would be doubling down on securing energy self-sufficiency or at least the ability to survive long periods without external supply, concerns are mounting that the island is instead regressing in terms of energy security. The Lai Ching-te administration is adhering to policies that increase reliance on short-term energy imports, easily blockaded by China, while simultaneously pursuing the closure of domestic nuclear power plants and expanding the proportion of liquefied natural gas (LNG). Meanwhile, the expansion of renewable energy generation capacity is lagging.
The Lai government itself acknowledges the reality that over 97% of the island's energy is import-dependent and has expressed concerns about energy security. At the same time, it has set a goal of achieving carbon neutrality by 2050 and is striving to reduce carbon emissions. In this context, the Taiwanese government views LNG as a relatively clean energy source and is gradually reducing its reliance on coal. Natural gas, which accounted for 32% of Taiwan's power generation in 2016, increased to 42% last year, and President Lai aims to raise this proportion to 50% by 2030. Notably, there is a move to increase purchases of US LNG to address the trade imbalance with the United States, particularly following the election of the immediate past US President, further contributing to the increased reliance on LNG.
However, LNG has a critical weakness: it is difficult to store for long periods, which could lead to severe problems in the event of a blockade or isolation. With its high population density and limited land area, Taiwan struggles to secure sufficient space for costly LNG storage facilities. Lu Tsai-ying, an energy expert at the Taiwan Democracy Institute's Emerging Technology Research Center, warns that Taiwan's LNG reserves would only last for 12 days in a crisis. Considering that coal reserves can last for 42 days and crude oil for 146 days, an energy policy centered on LNG could exacerbate vulnerabilities to security threats.
Expert Lu predicts that coal, which currently accounts for 39% of Taiwan's power, and renewables, at 12%, will be the primary energy sources in a blockade, isolation, or war scenario. The government is expected to utilize existing coal-fired power plants and convert closed ones into emergency backup power stations to cope with energy crises. In this way, she estimates that Taiwan could survive for at least 40 days, and much longer with a power rationing system. Coal has the advantage of being easier to store than LNG and has twice the energy density. "The Taiwanese government is increasing its strategic coal reserves," Lu added.
While Taiwan's awareness and response to energy security have been slow, the unprecedented level of attention it is now receiving is a notable change. This July, Lu's think tank and the Foundation for Defense of Democracies in the United States will jointly conduct a simulation exercise focused on Taiwan's energy resilience. Taiwan Power Company (Taipower) will provide relevant data, and high-ranking officials and industry leaders will be invited to participate. This signals that the once passive Taiwanese government is now recognizing the seriousness of the energy security issue and is beginning to explore practical countermeasures.
The debate over nuclear power also continues within Taiwan. Despite the drawback of having to import nuclear fuel, nuclear power requires very little land compared to the amount of electricity it produces. However, the independence-leaning Democratic Progressive Party (DPP), to which President Lai belongs, maintains a firm anti-nuclear stance. His predecessor, Tsai Ing-wen, upon taking office in 2016, simultaneously pursued the challenging goals of reducing carbon emissions and phasing out carbon-free nuclear power, which then accounted for 12% of the energy mix.
Coupled with this nuclear phase-out policy, numerous renewable energy projects are significantly delayed. President Tsai had initially set a goal of increasing the share of renewable energy to 20% by 2025, but this was not achieved, and the target deadline has been extended to the end of 2026. However, experts remain skeptical about whether the Lai government will be able to meet this extended goal. In the meantime, Taiwan's aging six nuclear power plants have been shut down as scheduled, with the last remaining one set to close on May 17th.
It is crucial to note that Taiwan's energy shortage could escalate into a global security risk, as the island is a critical base for the production of approximately 90% of the world's most advanced semiconductors. The semiconductor industry is particularly energy-intensive, and even a few seconds of power outage can severely impact production. In addition to frequent small-scale power outages, Taiwan has experienced three major blackouts in the past seven years. The large-scale blackout in 2022 disrupted power supply to more than five million households and reportedly caused losses exceeding NT$5 billion to the semiconductor, petrochemical, and steel industries.
While the Taiwanese government tends to attribute these blackouts to human error and an overly centralized power grid, critics point to the alarmingly low reserve power capacity. Furthermore, the rapid growth of the artificial intelligence industry is accompanied by massive energy consumption, raising questions about whether Taiwan's power supply capacity can meet this increasing demand.
During last year's presidential election in Taiwan, nuclear power was a major domestic issue between the DPP and the two opposition party candidates. The Kuomintang (KMT), the main opposition party to the DPP, is pushing for the passage of legislation to extend the lifespan of the only remaining nuclear reactor in southern Taiwan.
On March 9th, Tung Tzu-hsien, Vice Chairman of President Lai's Climate Change and Sustainability Committee, expressed support for nuclear power, emphasizing the importance of maintaining Taiwan's manufacturing capacity in the event of war. Raymond Greene, the de facto US ambassador to Taiwan as the Director of the American Institute in Taiwan (AIT), stated in an interview with Taiwanese media that nuclear power is an "interesting area for future cooperation" and that the US is willing to help Taiwan transition to nuclear power if the government desires. Expert Lu anticipates that the KMT's bill will pass the Taiwanese parliament, but notes that under Taiwanese law, reactivating a closed nuclear reactor requires a lengthy safety inspection process, meaning it could take at least three to five years for a closed reactor to become operational again.
In conclusion, facing the potential threat of a Chinese blockade, Taiwan seems to be neglecting the crucial task of securing energy independence, preoccupied with short-term political considerations and the policy goal of phasing out nuclear power. While increasing reliance on LNG may contribute to short-term carbon emission reductions, it exposes a significant vulnerability from a long-term security perspective. The slow progress in expanding renewable energy generation and the insistence on closing nuclear power plants hinder the diversification of the energy mix and make Taiwan more susceptible to external shocks.
The Taiwanese government must re-evaluate its energy policy from a more realistic and long-term perspective to stabilize energy supply and enhance security. Expanding coal reserves and exploring emergency utilization plans for closed coal-fired power plants can serve as short-term contingency measures, but they are not fundamental solutions. Efforts to accelerate the development of renewable energy and reconsider the role of nuclear power within safety parameters are urgently needed to increase energy independence through diversification of the energy mix.
The upcoming US-Taiwan energy resilience simulation exercise could be a significant opportunity for Taiwan to raise awareness of energy security issues and explore practical countermeasures. However, alongside these efforts, the Taiwanese government must establish a long-term energy security strategy and consistently implement it to ensure a stable energy supply and protect national security amidst potential threats from China. Securing energy security is not merely an economic issue but a core task directly linked to Taiwan's survival.
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