President Ma Ying-jeou has promised to push for the passage of a renewable energy development bill during the current session of the Legislative Yuan, which wraps up at the end of June. The proposed law would provide an environment conducive to the establishment of a viable renewable energy industry on the island. It would also fulfill a green-energy commitment that Ma made during his election campaign.

Ma stated his commitment during the two-day national energy conference that ended on April 15, saying that the Executive Yuan (Cabinet) should revise the bill in accordance with the conclusions of the conference before presenting it to the Legislative Yuan for discussion.

The bill was originally submitted to the Legislative Yuan in 2002 and has been stalled there ever since as legislators have squabbled over its provisions, each demanding provisions that favor his or her vested interests. The legislators themselves have presented six different versions of the bill, in addition to the one from the Executive Yuan.

One point of contention is the formula for figuring the prices that the state-run Taiwan Power Co. (Taipower) will pay for power generated by private operators using renewable energy, mainly solar and wind. The price rate will, in large measure, determine how long it takes for investors to recover their capital and how much profit they will make.

The protracted delay in the Legislative Yuan is a source of severe frustration for investors, notably InfraVest GmbH of Germany. Karl-Eugen Feifel, chairman of the company’s Taiwan subsidiary, recently threatened to suspend plans to invest NT$50 billion in wind farms here over the next five years.

Feifel noted that Taipower is buying electricity from his company`s wind farms for only NT$2 per kilowatt/hour, compared with NT$4.7 for power from private power producers using gas-fired generators and NT$2.3 for those using coal. Taipower’s own wind generators produce electricity that costs NT$2.6 per kw/h. The sharp appreciation of the euro against the NT dollar in recent years has aggravated the situation, almost pushing InfraVest into the red last year.

According to Fiefel, a fair price for wind-power electricity would be NT$3.5 per kw/hr.

Fiefel also complained about the complicated process for establishing a wind farm, saying that government approval for its first such facility on Taiwan took five years to obtain.

The chairman thinks that Taiwan’s wind-power policy is too passive. As a result wind power today accounts for just 0.8% of the island`s energy market. The government wants to raise the percentage to 8%, but ever this is still far lower than the 30% targets set by Germany and Denmark.

InfraVest has spent NT$10 billion to install 100 wind-power generators in Taiwan, mainly in Miaoli, Taichung, and Changhua. The company has 41% of the local market; Taipower has the other 59%.

His company has made great contributions to the green movement in Taiwan, Fiefil said, claiming that his wind generators have helped to cut CO2 emissions by 400,000 metric tons annually.

Insiders agree that government backing is essential to the survival of renewable-energy operators. One problem is their higher costs, which run around NT$2.6 per kw/h for wind power, NT$3 per kw/h for hydro power, and a staggering NT$12-20 for solar power. This compares to less than NT$2 fore oil-powered power plants, and under NT$1 for coal and nuclear power. Taipower supplies electricity to its clients for only NT$2.1 per kw/h.

Another big problem is the unstable source of energy. The peak season for wind-power generation in Taiwan is the winter, when the winds blow strong, but output plummets to just one-tenth the winter amount when the winds die down in the summer time-just when demand is at its peak.