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| Author | Jenny Lin |
| Updated | October 08, 2024 |
Energy Taiwan and Net-Zero Taiwan, the largest renewable energy exhibition in Taiwan in 2024, concluded on October 6. Originally scheduled from October 2 to 4, the event was postponed due to Typhoon Koinu, leading to interruptions on the first two days. Despite weather-related challenges, the event attracted numerous exhibitors and visitors from PV, ESS, and electric vehicle charging stations. Research institutes in wind energy and hydrogen energy generation also actively participated. InfoLink will delve into key topics of this exhibition and provide an in-depth analysis of Taiwan's market's evolving demand and industrial trends.
Taiwan’s PV market: sluggish demand and postponed projects
Taiwan has seen sluggish PV demand since 2023. Many industry players expected the approval process for PV projects would accelerate following the new government's inauguration, potentially triggering a surge in installations. However, the actual progress has not met these expectations. Government approval procedures and project delays have emerged as the main challenges currently. Some manufacturers have reported that although many utility-scale projects had been awarded by the first half of 2023, they expected the new administration to expedite the approval and commence construction. Unfortunately, public opposition and complaints, especially concerning land use and environmental impacts, have hindered progress. Residents have raised concerns that solar facilities may negatively affect property values or bring other problems, further delaying the issuance of construction permits. As a result, these hurdles have led to falling market demand. InfoLink estimates Taiwan's PV market demand to drop to 1.8-2 GW in 2024.
According to the Energy Administration, Taiwan added merely 1.2 GW of PV installations from January to August, down 30% YoY, accumulating 13.6 GW as of August. Given the current gloomy demand and postponed projects, installations will continue to slow down. InfoLink expects PV demand in Taiwan for 2025 to reach 1.5-2 GW, leaving a 6.4 GW gap from the 20 GW target set for 2025. Generally, the pessimistic outlook persists.
Manufacturers seek new opportunities amid waned market popularity
Given substantial rises in China's polysilicon and wafer capacity as well as n-type ones in 2023, supply chain prices have declined, and module prices in Taiwan have kept plunging so far. While the price drop benefits developers, the purchasing fee rates and VPC certification subsidies do not allow Taiwan's modules to achieve cost-effectiveness compared to Southeast Asian modules.
While n-type dominates orders in the second half of the year, Southeast Asian module prices sit at USD 0.17-0.19/W, with room for negotiation based on order status. In contrast, Taiwan’s module makers generally offer price quotes at USD 0.28-0.30/W, pressured by price competition. Given the notably weaker market demand in 2024 and recent US AD/CVD issues on Southeast Asia, future price trends for Taiwanese modules require observation, especially after implementing the Southeast Asia AD/CVD rates.
Taiwan’s manufacturers must seek alternatives and adopt flexible supply chain collaborations to tackle challenges amid weakened demand this year. A prominent discussion at the exhibition was about partnering with cell suppliers in Southeast Asia to cut production costs and enhance competitiveness. In addition to pairing local cells with local modules, there is potential to utilize third-country cells to produce Taiwanese modules. While this may not achieve Taiwan's VPC certification, it offers a competitive pricing advantage compared to local modules, allowing them to supply large electricity consumers in Taiwan for green energy self-consumption. Furthermore, some Southeast Asian manufacturers, prompted by the US anti-dumping issues, have begun exploring overseas outsourcing opportunities to export to the U.S. This market strategy can foster a win-win situation between Southeast Asian and Taiwanese manufacturers. However, given that the U.S. anti-dumping tariff rates on the four Southeast Asian countries have yet to be released, future progress requires official statements by November 27.
In addition to seeking overseas OEM orders, the growing awareness of the competitiveness of third-country modules has led to the emergence of an agency model as a new market strategy. This has also become one of the focal points of this exhibition.
Rising C&I and residential energy storage; boosting potential of BTM storage
Similar to the PV market, energy storage projects are facing delays due to protests. As of mid-2024, no new solar-plus-storage projects have been awarded, and only one out of four previously awarded projects is operational. Many projects are stalled due to unclear administrative processes and local protests. Despite these setbacks, the BTM market has shown strong growth potential at this year's exhibition. The government is considering a time-of-use pricing plan for BTM storage. If they increase the price gap between peak and off-peak hours, it could make these systems more profitable and increase demand.
Many manufacturers showcased energy storage solutions for electric vehicle (EV) charging stations. Since utility-scale charging stations can put pressure on the grid, especially during peak hours, BTM storage systems can help balance the load and stabilize the grid. Additionally, the Taichung City government’s subsidies for developers building charging stations are driving the progress of related projects. With the growth of electric vehicles and rising electricity prices, the demand for BTM energy storage will increase in the coming years.
Long-term Outlook for PV and Energy Storage
PV projects continue to face opposition from local communities, and with land shortages and difficulties in securing grid connections, the 2025 goal of 20 GW of PV installations seems unlikely. Most manufacturers are pessimistic about next year's PV market demand. However, the growth of energy storage systems, especially BTM storage, is providing new hope for Taiwan's energy market. With advancements in technology and government support, energy storage could become a key driver of Taiwan’s energy transition in the coming years.