Taiwan Today

Tainan City in southern Taiwan is poised to become a major international hub of renewable energy technology.

From ground level, Renjian Qingjing in southern Taiwan’s Tainan City looks much like countless other residential communities across the country. A bird’s-eye view of the area’s neatly arranged multistory homes reveals a very different picture. Of the 130 houses, 56 have rooftop photovoltaic (PV) systems, the highest proportion of any neighborhood in Taiwan.

The community in Tainan’s Annan District was among the first to receive subsidies for the installation of PV panels under the municipal government’s Solar City Project. From 2011 to 2017, residents were awarded a combined NT$3.94 million (US$131,000), covering up to 16 percent of total installation costs. Participating homeowners are also reaping financial rewards thanks to central government incentives. Under the 2009 Renewable Energy Development Act, state-owned utility Taiwan Power Co. (Taipower) is required to offer green energy suppliers a feed-in tariff (FIT), a premium fixed rate for electricity, for a period of 20 years.

“Environmental considerations and government support programs have inspired many locals to embrace solar energy,” said Wu Ching-ping (吳清平‬), community operations manager. “We pocket returns averaging 13 percent annually by selling our electricity to Taipower.”

Low-Carbon Model

Launched in 2011, the Solar City Project aims to transform Tainan into a low-carbon metropolis. One-stop service windows have been established at many district offices to provide information on various forms of financial and technical support for rooftop, ground-mounted and floating PV systems. By January this year, 434 megawatts (MW) of solar capacity had been installed citywide. This achievement earned Tainan gold in the Low Carbon Model Towns category of the Asia-Pacific Economic Cooperation’s 2017 Energy Smart Communities Initiative Best Practices Awards Program.

According to Stanly Yin (殷世熙‬), director-general of Tainan City Government’s Economic Development Bureau, the project capitalizes on regional advantages in such areas as climate, industrial prowess and research capabilities. “Our city receives an average of 2,024 hours of sunshine per year, compared to the national mean of 1,601,” he said. “We also have access to a complete renewable power supply chain.”

Tainan is home to more than 270 companies involved in developing and manufacturing green energy conservation, generation and storage technologies. Academia-private sector collaboration is a key factor in the industry’s success, Yin said, adding that research groups at local institutions including National Cheng Kung University, National University of Tainan and Southern Taiwan University of Science and Technology have developed robust collaborative relationships with many of the enterprises.

These assets explain Tainan’s selection as the hub of a national renewable energy industry promotion plan. The central government project comes under the Forward-looking Infrastructure Development Program (FIDP), a comprehensive initiative aimed at addressing Taiwan’s key infrastructure needs for the next 30 years.

The green energy portion of the FIDP includes some NT$8 billion (US$266 million) in funding through 2018 for a variety of projects nationwide spanning smart meters, solar power facilities and wind turbines. Among the largest of these is Shalun Green Energy Science City (SGESC). Slated to be built next to Taiwan High Speed Rail’s Tainan Station, the 22-hectare park will serve as a center for cross-sector collaboration in innovative renewable technologies. “With our ample sunlight, successful promotional campaigns and expanding green energy industry cluster, Tainan can advance the government’s goal of phasing out nuclear power by 2025,” Yin said.

Huang Der-ray (黃得瑞), director-general of the SGESC preparatory office, said the project aims to foster a green energy ecosystem conducive to cutting-edge R&D, international cooperation and talent cultivation. Construction on the park began at the end of March. Upon completion, it is expected to include demonstration, exhibition and testing and certification facilities, as well as a branch of Taipei City-based Academia Sinica, Taiwan’s foremost research institution.

According to Huang, projects will focus on areas targeted for strategic promotion under the green energy portion of the FIDP. These comprise solar and wind power generation equipment; energy storage devices such as fuel cells and lithium batteries; conservation technologies for electric vehicles and green buildings; and systems integration infrastructure like smart grids.

Researchers will come from organizations including the government-supported Industrial Technology Research Institute, Institute of Nuclear Energy Research under the Cabinet-level Atomic Energy Council and National Applied Research Laboratories under the Ministry of Science and Technology. The site will also support commercialization by promoting tie-ups with enterprises based at the some 30 industrial parks in southern Taiwan.

“The site will be a bridge between academia and industry as well as domestic and foreign companies,” Huang said. “It will drive innovation in renewables and support Tainan’s transition to a low-carbon, smart city.”

Positive Industry Outlook

SGESC is expected to add further momentum to Tainan’s blossoming green energy sector. Among the local firms growing their businesses at home and abroad is Hengs Technology Co. Established in 1998, it is a trailblazer in offering turnkey solar services ranging from feasibility analysis and site planning to construction and maintenance, according to Miranda Lan (蘭佳霏), a company project manager.

To date, Hengs has completed over 600 cases in Taiwan and overseas totaling some 100 MW in solar capacity. Prominent clients included Kaohsiung Rapid Transit Corp. and the Port of Kaohsiung in the southern Taiwan metropolis as well as Tainan-based National Museum of Taiwan History and Taiwan Semiconductor Manufacturing Co. headquartered in northern Taiwan’s Hsinchu.

“The ability to source all manner of high-quality components and materials locally such as aluminum extrusion frames, PV modules and switchgears has facilitated the rapid growth of our business,” Lan said. “Central and local government incentives such as the FIT have also emerged as key sales drivers in the domestic market.”

Amid rising international demand, Hengs has set up branches in Cambodia, India, Japan, South Africa and Vietnam. “The technology is becoming more efficient and cost-effective all the time, making solar solutions an increasingly viable option for a variety of organizations,” Lan said. “We plan to continue growing our business abroad and showcase Taiwan’s expertise in the field of renewables.”

Another Tainan-headquartered enterprise working to expand its international reach is Alanod-Xxentria Technology Materials Co. Launched in 2013, the firm is a joint venture between Germany’s Alanod GmbH and Co. KG and Taiwan’s Xxentria Technology Materials Co. The manufacturer of absorber and reflector coils for energy-efficient lighting and solar power systems exports its products to more than 15 countries, many of them in Southeast Asia. “Offering a skilled labor force and reasonable land prices, Tainan is the perfect place to explore the synergies between Alanod and Xxentria’s expertise in aluminum surface treatments and metal composite materials, respectively,” CEO Derek Tilot said.

With the Port of Kaohsiung located about an hour from Tainan, the company can ship large-volume orders across Asia, the world’s fastest-growing renewable energy market, in less than three weeks, Tilot said. The strong international reputation of the Made in Taiwan label is another advantage of basing operations in the city, he added.

In tune with other industry players, Tilot is upbeat on future growth prospects. “The outlook for energy-efficient products has never been brighter,” he said. “With our setup in Tainan, which boasts state-of-the-art equipment, high-quality staff and good relations with representatives all over the world, we’re confident we can capture an ever-increasing market share.”

Write to Kelly Her at kher@mofa.gov.tw