Taiwan’s electricity sector is undergoing a revolution. The legislature early this month passed draft amendments to the Electricity Act (電業法), which are aimed at liberalizing the electricity market, promoting a “renewable” supply and terminating nuclear power by 2025.
While this is the most fundamental legal change in three decades of pushing competition in the sector, questions remain as to whether the amendments go far enough and how more reform could be implemented.
Globally, many governments fail to achieve energy security, energy equity and environmental sustainability simultaneously, which is referred to as the “energy trilemma.” The power sector has proved even more difficult to reform in light of the challenges posed by climate change.
Looking at the revised energy bill, it might be pointed out that recent electricity reform in Taiwan has mainly focused on the supply side, and powerful economic incentives remained non-existent for the demand side. In fact, demand-side participation is particular important in energy policy, where the public is expected to contribute by changing their lifestyles.
Demand-side participation refers to policy instruments that aim to reduce end-user energy consumption by clear price signals over time or to modify electricity demand from peak to off-peak.
A more active demand side can reduce costs and lower resource requirements at every stage of electricity supply. Ideally, end customers, including large industrial users and residential consumers, should be well informed about the opportunities for cutting costs through demand reduction and efficiency improvement.
The US’ 1992 Energy Policy Act established the basis for utility investments in demand-side management and energy efficiency technologies. In the US’ Energy Policy Act of 2005, Energy Independence and Security Act of 2007 and in other key orders issued by the US Federal Energy Regulatory Commission, regulators further recognized the economic benefits of demand-side participation and its importance for improving the competitiveness of wholesale electricity markets.
In the EU, the value of demand side is clearly reflected in the European Network Codes, Energy Efficiency Directive and other energy consumption provisions. In addition, the UK launched an electricity capacity auction in late 2014, and is now experimenting with a variety of initiatives for long-term demand reduction.
All these measures view demand-side flexibility as a critical enabler of efficient supply, consumer empowerment and integration of renewable energy sources. Furthermore, demand response can create new business models and promote innovative technologies, such as low-energy consulting services, “smart” meters and home energy management appliances.
Taiwan’s industrial demand for electricity still accounts for more than 50 percent of supply — compared with 29 percent in the UK and 26 percent in the US. These figures remind decisionmakers of a high potential for demand-side management and its high-reward benefits to reduce energy costs and greenhouse gas emissions.
Relatively low electricity prices in both residential and industrial sectors make the timing of this reform politically difficult.
Based on the experiences of other nations, it is possible reforms will be proposed sooner rather than later, and demand-side considerations should be integrated into new policy thinking more explicitly.
Yang Chung-han is a doctoral researcher at the University of Cambridge’s Centre for Environment, Energy and Natural Resource Governance.
The headline of this piece has been changed since it was first published.
The Chinese Communist Party (CCP) continues to bully Taiwan by conducting military drills extremely close to Taiwan in late May 2024 and announcing a legal opinion in June on how they would treat “Taiwan Independence diehards” according to the PRC’s Criminal Code. This article will describe how China’s Anaconda Strategy of psychological and legal asphyxiation is employed. The CCP’s People’s Liberation Army (PLA) and Chinese Coast Guard (CCG) conducted a “punishment military exercise” against Taiwan called “Joint Sword 2024A” from 23-24 May 2024, just three days after President William Lai (賴清德) of the Democratic Progressive Party (DPP) was sworn in and
Former US president Donald Trump’s comments that Taiwan hollowed out the US semiconductor industry are incorrect. That misunderstanding could impact the future of one of the world’s most important relationships and end up aiding China at a time it is working hard to push its own tech sector to catch up. “Taiwan took our chip business from us,” the returnee US presidential contender told Bloomberg Businessweek in an interview published this week. The remarks came after the Republican nominee was asked whether he would defend Taiwan against China. It is not the first time he has said this about the nation’s
In a recent interview with the Malaysian Chinese-language newspaper Sin Chew Daily, former president Ma Ying-jeou (馬英九) called President William Lai (賴清德) “naive.” As always with Ma, one must first deconstruct what he is saying to fully understand the parallel universe he insists on defending. Who is being “naive,” Lai or Ma? The quickest way is to confront Ma with a series of pointed questions that force him to take clear stands on the complex issues involved and prevent him from his usual ramblings. Regarding China and Taiwan, the media should first begin with questions like these: “Did the Chinese Nationalist Party (KMT)
The Yomiuri Shimbun, the newspaper with the largest daily circulation in Japan, on Thursday last week published an article saying that an unidentified high-ranking Japanese official openly spoke of an analysis that the Chinese People’s Liberation Army (PLA) needs less than a week, not a month, to invade Taiwan with its amphibious forces. Reportedly, Japanese Prime Minister Fumio Kishida has already been advised of the analysis, which was based on the PLA’s military exercises last summer. A Yomiuri analysis of unclassified satellite photographs confirmed that the PLA has already begun necessary base repairs and maintenance, and is conducting amphibious operation exercises