Wind Power Generation: Only After Opening the Second Tender Bid Did We Know Who Betrayed the Nation

  Wind Power Generation: Only After Opening the Second Tender Bid Did We Know Who Betrayed the Nation

United Daily News Editorial (Taipei, Taiwan)

June 29, 2018

 Translation of an Excerpt

The Economics Ministry recently made public the results of the second stage public tender for offshore wind power generation. Northland Power Inc. of Canada and Ørsted of Denmark were the winning bidders, acquiring a capacity of 16.6 million kilowatts. What was shocking is that the price of wind power generation from the competitive bidding this time was only between NT$2.22 and NT$2.52 per kilowatt hour (kWh), far below the wholesale price stipulated by government of NT$5.8 kWh. Such a huge price differential may be said, on the surface, that wind power generation had the potential to decrease, but in actuality, the government set the original wholesale price too high, fundamentally becoming suckers.

Based on the "nuclear-free homeland" energy policy, the government must expend enormous efforts to develop green energy; the public could understand this. However, to develop green energy or wind power generation, it still must consider the actual environmental conditions, as well as the price that people can afford, and not spearheading blindfolded all the way. The biggest problem the Tsai government faces is that, being obsessed with accelerating the reduction of the proportion of nuclear power, it has made the domestic power industry encounter crisis upon crisis starting last year, and walk the tightrope all the time this year. This situation, viewed in the eyes of foreign wind power developers, of course, gave them the impression that Taiwan was a fat cow waiting to be slaughtered. Then verily, the Economics Ministry also sheepishly handed itself to the butcher, signing a contract with a price far higher than the going international market rate.

In the selection at the first stage, the government set the wholesale price of NT$5.8 to buy wind power; at the competitive bidding in the second stage, operators, however, submitted bids with NT$2.5 kWh. In contrast, it is easily known who are the pseudo-friends of the public. Don't underestimate the gap of NT$3.3; calculated at 13.8 billion kilowatts per year, it means paying NT$45.5 billion more. Calculated on a 20-year contract, we have to pay an astronomical NT$910 billion more. May we ask: Signing such an unfair and unreasonable contract, should Economics Minister Shen Jong-chin be held accountable for his miscalculation? Or should President Tsai Ing-wen shoulder the responsibility for insisting on the nuclear-free homeland energy policy? Or, when the time comes, would the government wash its hands, letting the public shoulder high electricity rates?

For Taiwan, offshore wind power generation is about to take the first step; however, in the global market, the wind power industry has made progress by leaps and bounds in recent years. Nevertheless, the decision-makers in our government are novices in the extremevis-à-vis this situation. Also because of this, when the Economics Ministry stipulated the wholesale price last April, it cited data from more than ten years ago in Germany as reference, of course, it stipulated outdated indicators. What is even more serious is that the government has opened up vast sea areas for foreign operators to develop wind power; the information was largely not transparent and open enough, so much so whether policy decision and issuing of tender were professional enough, they are also being questioned. For instance, Tseng Wen-sheng, who came to Taipei with Chen Chu [formerly Kaohsiung mayor, now Secretary-General to President Tsai] to become Deputy Economic Minister, armed only with his experience of courting foreign investments during his term as director of economic development in Kaohsiung City, immediately took charge of overall planning and execution of energy source policy at the central level. Is this truly a case of talent and wisdom par excellence? Or a total disregard for professionalism? Were it not for the results of the competitive bidding at the second stage laid before the eyes of the public, people would not have known who was betraying the nation. In recent days, some energy source experts have called on the government to void the first tender; at a minimum this would be a “stop-loss” strategy!

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