If Taiwan does not have enough power supply, the semiconductor and Artificial Intelligence (AI) industries will not stay in Taiwan, commented Kuo Jyh-Huei, the new minister of economic affairs.
Kuo was responding to media questions during a tea party held on May 30. He said the combined capacity of generating units coming online in 2024-2025 will total 8.333 million kilowatts, significantly higher than the 5.972 million kilowatts of units being decommissioned, indicating the power supply is sufficient at least by 2030.
Despite Kuo's industry background, media questions focused on whether Taiwan will extend the life of nuclear power plants, potential changes in energy policy, and the sufficiency of green power for businesses, including small and medium-sized enterprises.
Kuo told reporters that the Ministry of Economic Affairs (MOEA) has no current answer on whether the No. 3 Nuclear Power Plant in Pingtung, now the only active nuclear plant in Taiwan, will be extended or decommissioned, and that any actions would be in accordance with the law. The plant is scheduled to stop generating power next May.
Kuo emphasized that decommissioning nuclear power plants will not significantly affect the power supply, but the power demand for AI applications may impact supply after 2027. Considering that AI could see explosive growth from 2027-2029, he said that "the third nuclear power plant could act as a backup plan," but stressed that such a plan would have to comply with the law.
To extend the third nuclear power plant's operational life, the current law – which mandates decommissioning after 40 years of use and requires an extension application five years before scheduled decommissioning– would need to be amended, as the extension application period has already passed.
Many countries are restarting nuclear power plants due to soaring natural gas prices caused by the Russia-Ukraine war, which has increased Taiwan Power Company's (Taipower) fuel costs by NT$700 billion. However, electricity prices cannot be adjusted accordingly as Taipower has policy obligations, making it extremely difficult for Taipower to avoid losses, Kuo continued. In the future, he hopes that state-owned enterprises can be managed stably and their stocks can be publicly listed
Taiwan to lead AI chip and AI server production for next 50 years
In addition to power issues, Kuo mentioned that other countries also want to manufacture AI chips but are not doing well. Taiwan excels in semiconductors, and AI chips and AI servers will enable Taiwan to lead the way for another 50 years.
Kuo continued that 90% of the world's AI servers are produced in Taiwan, and smart manufacturing and innovation are being carried out in Taiwan. In the future, Taiwan should develop AI applications, particularly in human health, as AI can assist in early detection and treatment.
Kuo said his vision is for western Taiwan to be a hub for developing tech industries and eastern Taiwan to be a hub for the health industry, using preferential policies to attract renowned enterprises to invest in Taiwan.
Kuo highlighted two major strategies for Taiwan's economic development: "Outbound Domestic" and "Inbound Foreign." The "Outbound Domestic" strategy involves taking Taiwan's manufacturing parks abroad and encouraging Taiwanese companies to set up factories overseas. For instance, Taiwan could establish a semiconductor industrial park in Kumamoto, Japan, bringing Taiwan's supply chain to serve both TSMC's Japanese venture (JSAM) and local Japanese companies, thereby tapping into the Japanese market.
The "Inbound Foreign" strategy aims to attract foreigners to Taiwan. Starting with Taoyuan, there are 400 million people within a 3-hour flight radius. Taiwan can consider this population as its domestic market, inviting them to enjoy Taiwan's gourmet food, medical aesthetics, and other high-end services, thereby expanding Taiwan's influence in the international community.
