A report released on Monday by the Washington-based Foundation for Defense of Democracies warned that Taiwan must urgently reduce its dependence on imported energy, which China could exploit through “gray zone” tactics to force political concessions.
The report said that if Beijing succeeded in constricting Taiwan’s liquefied natural gas (LNG) supply, the nation could lose up to 50 percent of its power grid capacity. Such a shock would force Taiwan into a stark choice: maintain power for essential civilian infrastructure, or sustain industrial production, particularly in strategic sectors such as semiconductors.
The report urged Taiwan to improve energy resilience by diversifying LNG supply chains, expanding and decentralizing energy storage, reconsidering nuclear power, improving public-private cooperation to protect critical infrastructure, and engaging in joint cybersecurity training.
This year’s referendum on restarting a nuclear power plant failed due to a low turnout, suggesting a lack of broad social consensus on the nuclear issue, despite growing concerns about energy security.
Given the constraints, Taiwan must accelerate efforts to diversify its power grid. Even without the threat of Chinese coercion, the rapid expansion of the semiconductor industry is placing immense strain on the grid. The demand would only grow as artificial intelligence drives new energy-intensive investments, including data centers.
Taiwan has pursued energy transition since the first term of former president Tsai Ing-wen (蔡英文), but progress has been hindered by practical and political obstacles. Geographic constraints and extreme weather limit where renewable and conventional infrastructure can be built. Bureaucracy and local opposition impede development in areas that are technically viable, while grid limitations and supply chain challenges slow installation even where conditions are favorable.
The government should move decisively to remove bureaucratic barriers and address local resistance through targeted incentives and investment. Energy infrastructure requires massive spending, but treating such investment as a matter of national security — rather than simply environmental policy — would help mobilize resources more effectively.
Public concerns about wildlife, fisheries and coastal ecosystems could be addressed through smarter design. Taiwan could adopt wind turbines with slower rotation speeds and higher visibility to reduce harm to birds and bats; place geothermal systems and LNG terminals in locations that avoid fish habitats; and install solar panels on rooftops and brownfield sites to avoid conflict with agricultural land. Increased investment in eco-friendly technology would help reconcile environmental protection with energy development.
Russia’s systematic targeting of Ukraine’s power grid has shown how energy systems can be weaponized. There is little doubt that Beijing would attempt similar tactics against Taiwan. For this reason alone, Taiwan should prioritize decentralizing and diversifying its grid using a broad mix of renewable and conventional energy sources rather than engaging in polarized debates over which technology should dominate.
Improving storage capacity is equally critical. Taiwan could expand the use of lithium-ion battery systems for overnight storage and develop long-duration storage in mountain caverns or at secure coastal sites. Such facilities would stabilize renewable output and buffer the system against disruptions.
Taiwan should also make “gray zone” coercion riskier for Beijing by clearly signaling that blockades or disruptions to shipping would be considered acts of war. If the US, Japan and other partners made similar declarations, China would find it difficult to apply pressure under claims of legal or non-escalatory action.
Taiwan must prepare for the very real possibility of a blockade. Improving energy, food and communications resilience is essential. Failure to prepare could leave the nation vulnerable to coercion long before help could arrive.
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