Taiwan's limited renewable energy supply is emerging as a potential bottleneck for its semiconductor sector, with ripple effects likely as other industries also intensify their demand for green power. Driven by global moves toward net-zero emissions and RE100 commitments, the call for clean energy is surging across energy-intensive sectors, including AIoT data centers, 5G, and electric vehicles. However, Taiwan's renewable energy providers face a significant challenge, struggling to meet rising demands as local supply remains constrained.
For Taiwan's semiconductor industry, the shortage poses an immediate risk. RE100-bound clients may begin shifting orders to countries with more robust green energy availability. This shortage not only pressures domestic manufacturers to consider relocation but could also stymie Taiwan's ambitions to build a competitive AI ecosystem.
Renewable energy deployment faces mounting challenges, particularly in solar energy. Despite being fast and cost-effective, solar projects have slowed due to corruption scandals, halting approvals, and disrupting installation timelines. Complex regulations further impede large-scale solar initiatives, with red tape surrounding rooftop installations and aquaculture and agricultural solar farms.
Meanwhile, Taiwan's offshore wind sector grapples with inflation-driven costs. Rising material and labor expenses have led to a standoff between developers and buyers, resulting in stalled projects as buyers resist price increases.
With Taiwan Power Company proposing traditional electricity price increases, green energy costs may also rise, exacerbating the scarcity. Leading semiconductor firms, which are major consumers of green power, face heightened constraints as global clients like Apple and Google push for higher renewable energy usage within the supply chain.
Demand is further intensifying from foreign AI companies interested in establishing Taiwan-based data centers, placing additional strain on green power resources. Semiconductor and AI firms, in particular, favor large-scale projects for stability, which local rooftop and small-scale solar options cannot adequately meet.
The misalignment between Taiwan's green energy supply and surging demand creates a critical imbalance, which industry experts say requires urgent government intervention to alleviate. Without swift action, Taiwan's green energy dilemma threatens to stall its high-tech ambitions and potentially impact its position in the global semiconductor market.
