A Chinese military magazine, Naval and Merchant Ships, recently zeroed in on one of Taiwan’s biggest vulnerabilities. The island democracy, which China claims is part of its territory and threatens to overtake, imports more than 96 percent of its energy.
Most of it — oil, coal and liquefied natural gas — arrives by ship, and most of the oil is from the Middle East. China could debilitate Taiwan by blocking these ships and thereby “win without fighting,” the magazine said.
China’s most recent military drills around Taiwan simulated doing exactly that. These actions not only could devastate Taiwan but could bring the global economy to a standstill, because the world relies on Taiwan’s factories for the majority of advanced computer chips.
All countries need a mix of energy sources to ensure a stable fuel supply, said Thomas Isaacs, an expert on nuclear energy and waste. “But for Taiwan it is an order of magnitude more important,” he said.
Taiwan’s manufacturing sector, including its power-hungry chip factories, already eats up more than a third of the island’s energy supply. And as chipmakers like Taiwan Semiconductor Manufacturing Company, or TSMC, build more factories in Taiwan to keep up with skyrocketing demand for artificial intelligence chips, it has become even more important for the island to be able to make its own electricity.
TSMC, which makes chips for Apple and Nvidia, operates 17 factories, called fabs, in Taiwan. It plans to build six more this year. Nvidia, Google and Amazon have also announced investments in Taiwan. The government said it expected that within the next five years, Taiwan would need 13 percent more electricity to support the booming demand from the A.I. industry.
“Data centers filled with A.I. servers, increasingly precise semiconductors, state-of-the-art fabs — all of these advanced industrial breakthroughs require unprecedented amounts of energy,” said Raymond Greene, the director of the American Institute in Taiwan, the unofficial U.S. diplomatic mission in the country, at a gathering of business executives in March.
As Taiwan’s demand for energy has increased, its efforts to add more clean energy sources have become more important — and harder to achieve. In 2016, the government vowed that by this year, 20 percent of Taiwan’s energy would come from renewable sources. But last year, officials said they would fail to meet that goal and lowered the target to about 15 percent.
Disagreement between legislators and difficulties acquiring land have slowed the energy transition, said Tsaiying Lu, who works at the Research Institute for Democracy, Society and Emerging Technology, a government-funded think tank in Taipei.
The state electricity company, Taipower, has built giant wind turbines along the island’s western coast and installed solar panels that generate 14 megawatts of power.
In the mountains on the eastern coast, one of Taiwan’s most seismically active areas, the state oil company, CPC, has repurposed oil rigs to dig geothermal wells up to two miles underground.
Geothermal energy, producing power from the heat inside the Earth, is a developing field. Researchers in Taiwan said the techniques they developed could eventually be deployed in other locations around the world. The industry generates less than 1 percent of Taiwan’s energy supply, but the government has said that within three decades, it will make up 15 percent of it.
One hurdle facing the nascent geothermal industry is staffing. Bill Chen, a geothermal energy manager at CPC, said the kinds of engineers the company needed to do the specialized technical work were rarely interested in spending their days outdoors in the mud and rain at a drilling site. Most quit before completing their first year on the job, he said.
At the Renze plant in Yilan, one of Taiwan’s four operational geothermal facilities, generators hum and the air is thick with sulfur. Hsu Wen-ko, a power generation manager at Taipower, said his team had been “exhausting all methods” to make geothermal a reliable energy source for Taiwan.
As steam fogged his glasses, Mr. Hsu said scientists could not be sure how much power a given site would yield until they started drilling.
“What’s beneath the ground is largely unknown,” he said.
Taiwan’s energy capabilities took another hit last month when the island closed its last remaining nuclear power plant, the Maanshan No. 2 Nuclear Reactor. It had been one of the few places where Taiwan made its own electricity.
Nuclear energy once met more than 50 percent of Taiwan’s energy demand, but years of opposition after the disaster in Fukushima, Japan, in 2011, and public outcry over waste disposal sites, set in motion the slow shutdown of the industry.
Now, momentum is building for a nuclear restart in Taiwan, and a slow turnabout is underway in public and political willingness to accept nuclear energy.
Yang Chia-fa is a founder of a clean energy activist group, Climate Vanguards, and works for Taipower. Last summer, he traveled with a dozen activists to southern Taiwan to protest the planned shutdown of Maanshan. “Nuclear power is the real clean energy,” Mr. Yang said.
Days before Maanshan was shut down, lawmakers agreed to amend a law that could revive the reactor. The amendment, which needs to be signed by the president to take effect, would extend the allowable life span of nuclear facilities in Taiwan to 60 from 40 years. While several of Taiwan’s shuttered nuclear power plants have been dormant too long to be revived, the legislation could pave the way for a restart at Maanshan.
Taiwan’s president, Lai Ching-te, assured members of the ruling Democratic Progressive Party in May that even without nuclear power, Taiwan was not at risk of an electricity shortage.
But Taiwan has struggled with blackouts during heat waves and droughts in recent years, leaving millions without power. And there are concerns that the government’s existing investments in wind, solar and geothermal energy will not be able to keep up with the growing demand of Taiwan’s factories.
“If we continue to develop energy at the current speed, it will probably be far from enough to meet the demand for electricity,” said Ko Ju-Chun, a legislator in the opposition Nationalist Party who supports the revival of nuclear power. “We don’t have the conditions to be optimistic.”
Amy Chang Chien is a reporter and researcher for The Times in Taipei, covering Taiwan and China.
Meaghan Tobin covers business and tech stories in Asia with a focus on China and is based in Taipei.
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