TAIPEI – Taiwan’s Reactor 1 at Kuosheng 2 Nuclear Power Plant was shut down last week, six months before its scheduled decommissioning on December 27, due to a capacity constraint on spent fuel storage preventing refueling.
The decommissioning of the reactor marks another milestone in the island’s energy transition, an important initiative by President Tsai Ing-wen. Your government wants to shut down all of Taiwan’s nuclear reactors by mid-2025 and replace their electricity with huge amounts of renewable energy and natural gas. Kuosheng Reactor 1 is the third of six reactors in Taiwan to be shut down, with the remaining operational reactors expected to close at an annual rate from 2023 to 2025.
The 985-megawatt Kuosheng 1 reactor generated nearly 3% of Taiwan’s total electricity, and its loss is due to rising electricity demand and capacity constraints, which have already resulted in two blackouts.
Taipower spokesman Albert Chang said in a telephone interview that the loss of the reactor will not affect power margins.
“We anticipated the shutdown several months in advance and Taipower controlled this by commissioning a new 500 MW combined cycle gas turbine in Block 2 of Chiahuei, as well as 500MW of new PV systems.” We are confident that we will can provide the full power supply without any problems, “he said.
The combined cycle power plant Chiahuei 2 in combination with photovoltaics will have a hard time replacing the electricity from Kuosheng Reactor 1 – the only nuclear operator had operated the reactor with 101.94% capacity and generated 710,131 megawatt hours or 22,907 MWh per day.
Solar power is generated in Taiwan with a far lower capacity of only 15%, which is only 1,800 MWh per day. The Chiahuei 2 combined cycle power plant can operate at a very high capacity of 98%, but its smaller size means it can only generate around 11,760 MWh per day. The combined capacity of the backup electricity would only be 13,560 MWh per day, which would be a gap of 40%.
“It is just not enough to meet the expected record-breaking electricity demand this summer,” said Yeh Tsung-Kuang, professor of nuclear engineering at National Tsing-Hua University. “It is inevitable that there will be outages and power rationing for the remainder of this summer.”
This gap is likely to be closed with combined cycle power, which raises energy security and greenhouse gas emissions considerations.
Nuclear power generated 12.7% of the electricity in the power grid of the state-owned utility Taiwan Power Company (Taipower) last year, while coal generated 36.4% (plus 1.7% for coal-fired cogeneration). In addition to phasing out nuclear power, Taiwan plans to cut coal-fired power to 30% by installing 27 gigawatts of renewable energy to meet 20% of electricity needs and expanding natural gas-fired energy to 50% of demand.
In addition to realizing the ruling DPP’s vision of a “nuclear-free homeland”, the energy transition policy aims to reduce Taiwan’s carbon footprint and position the island as a leader in green energy in Asia.
Backed by a number of legislative and policy initiatives, including amendments to the Electricity Act, which will make nuclear power banned by 2025, as well as the liberalization of electricity sales, the government expects the energy transition to raise NT $ 1 trillion (US $ 36 billion). in investment, NT $ 1.2 trillion (US $ 43.3 billion) in production value and 20,000 job opportunities by 2025.
In her opening speech at EnergyTaiwan, Taiwan’s leading renewable energy trade show, last October, Tsai described Taiwan as “a leading center for green energy in the Asia-Pacific region”.
However, the expansion of renewable energy and natural gas capacities has faced a number of obstacles, including local opposition, government disputes and the impact of the pandemic.
Renewable energies accounted for only 5.8% of electricity generation in 2020, and the solar and offshore wind capacity that has been added since then is negligible. Solar power has an installed capacity of 6.12 GW and will need almost another 14 GW by 2025 to meet its target.
Taiwan has built the largest offshore wind sector in Asia outside of China, but early projects have been hit hard by the pandemic and most analysts believe Taiwan won’t reach its 5.7 GW target until 2026 or 2027.
However, while Taiwan is installing massive new natural gas turbines around the island, they are completely dependent on imported LNG. Taiwan’s LNG import capacity is already exhausted and new terminals have met serious opposition from environmentalists. A referendum is on the agenda on August 28, calling on voters to kill a third LNG terminal. Even if it fails, the project will be postponed as early as 2025.
The abolition of nuclear energy is facing a deadline that cannot be extended. Although a referendum passed in 2018 canceled the legal mandate to abolish nuclear energy without sufficient storage capacity for spent nuclear fuel, it is technically impossible to extend the service life of the plants. Another referendum on August 28 will ask voters to approve the restart of the controversial Lungmen Nuclear Power Plant 4 project, but that too would take years before it would go online. The elimination of all nuclear power generation by May 17, 2025 – when the operating license for the last reactor expires – is as good as certain.
At the same time the demand for electricity continues to rise. Demand rose 4.5% between January and April this year, on top of a 2.08% increase last year. The Bureau of Energy (BOE) estimates that demand will increase by 2.5% or more annually through 2027. Taiwan’s booming exports made it one of the top performing economies in the world in 2020, with gross domestic product growing by over 8% in the first quarter of 2021. The Chunghua Institution for Economic Research (CIER) expects Taiwan to close in 2021 despite an ongoing pandemic lockdown 4.8% and will grow by 3.23% in 2022.
“We hope to decouple economic growth from electricity consumption, but so far we are not seeing that decoupling,” noted BOE Deputy General Manager Lee Chun-li.
Taiwan got an early glimpse of the impact of inadequate power generation last month when peak demand hit record highs. Power outages occurred twice, on May 13th and May 17th. Large amounts of LNG capacity were offline due to scheduled annual maintenance in anticipation of low demand during the April to May rainy season. However, there was no rainfall in the middle of a 100-year drought, and Taipower struggled to maintain adequate reserves.
Wind turbines stand on a beach near the Linkou Power Plant, a coal-fired power plant operated by Taiwan Power Co. in New Taipei City, Taiwan, on September 24, 2020. © Getty Images
Tsai is committed to getting Taiwan on track for net zero emissions by 2050, aligning Taiwan with 59 countries around the world. The island has made strides in reducing emissions since peaking at 300.8 million tons in 2007, down 1.52% to 296.24 million tons a year, according to data from the Taiwan Environmental Protection Administration 2018.
But since renewable energy development has stalled, the power gap created by the loss of nuclear power is likely to be filled by natural gas, or worse, coal. Nuclear power emits little directly, but including construction and uranium mining, it is estimated to emit 400 grams per kilowatt hour.
The US Environmental Protection Agency estimates emissions from combined cycle gas turbines at 412 kilograms per MWh, while coal emits 1,000 kilograms per MWh. Just replacing the lost energy in Kuosheng Reactor 1 with natural gas will increase Taiwan’s CO2 emissions by 8,696 tons a day – or 3.17 million tons a year – while coal would increase 7.7 million tons a year.
Not only would this delay Taiwan’s net-zero targets, but it would also affect trade. The European Union introduces the Carbon Border Adjustment Mechanism, a tariff that would penalize latecomers in reducing emissions. The EU is Taiwan’s fourth largest export destination with an annual trade value of around 50.5 billion euros (1.68 trillion new Taiwan dollars). A CIER economist who is not allowed to speak to the media said: “If the EU imposes carbon tariffs, it will seriously affect Taiwan’s export competitiveness.”
Taiwan’s heavy industries, including semiconductors, petrochemicals, and steel, consume 37.47% of the island’s electricity and are made possible by Taiwan’s low electricity prices. Average electricity prices in Taiwan are NT $ 2.5 (US $ 0.09) per kWh, among the lowest in the world and well below the price Taipower pays for renewable energy, which averages 4.87 according to Taipower data NT $ per kWh is.
A price hike would create incentives to save energy and refocus Taiwan’s industrial policy, gradually eliminating less competitive industries, experts say.
“Electricity prices should reflect the cost of the energy transition,” said Chien Ker-Hsuan, assistant professor at National Tsing Hua University’s Institute of Technology Management.
Still, the BOE’s Assistant General Manager Lee remains confident.
“There have been some delays [in the energy transition], mostly because of the pandemic, “he stated.” But the pandemic will pass and we are very confident about 2025. “
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