As the global race for sustainable energy intensifies, Taiwan is making bold moves in the nascent floating wind sector. Despite only 200 MW of operational projects worldwide, led by France, Scotland, and Norway, industry projections suggest a surge of up to 50 GW in the coming years. Taiwan aims to be at the forefront of this green energy revolution.
Thomas Correll, Chief Commercial Officer of Copenhagen Infrastructure Partners (CIP), recently shed light on Taiwan's floating wind ambitions during the company's third round of offshore wind development discussions. Correll emphasized that while all major offshore wind developers are exploring floating technology, financing remains a critical challenge.
"No commercial-scale floating project has ever been banked," Correll noted at the "Realizing Floating Offshore Wind in Taiwan" forum. He predicted more conservative financing projections for initial projects, including higher debt service cover ratios, lower gearing, and increased margins. The industry requires approximately EUR250 billion over the next decade, primarily through project financing, necessitating early involvement of banks and financial institutions.
Credit: CIP
Despite these hurdles, there's substantial interest from both Taiwanese and international banks. However, Correll stressed the need for clear, bankable off-take solutions to attract investment. "In order for us to really start investing a lot of money in preparation for this, we just need to see some kind of feed-in-tariff(FIT) structure," he said.
Taiwan's strategic position in the floating wind market is becoming increasingly apparent. Post Round 3.2 and 3.3 offshore wind projects, floating wind capacity will likely become indispensable for meeting the island nation's 2035 targets. Correll believes Taiwan will need at least a few gigawatts of floating wind to meet these goals.
The challenges extend beyond financing. Regulatory and economic hurdles persist, with floating wind projects expected to be initially more expensive than fixed-bottom alternatives. This necessitates acceptance from off-takers and government bodies regarding the premiums or support required to make these projects viable.
Infrastructure and supply chain capabilities are also crucial. While Taiwan's mature offshore wind market provides a solid foundation, ensuring appropriate infrastructure for floating wind is vital for the sector's growth.
By 2035, it's estimated that around 40 GW of floating wind projects will have achieved a Final Investment Decision (FID) globally, spanning Europe, Asia, and the United States. Taiwan's commitment to floating wind energy signifies a crucial step towards achieving its renewable energy goals.
