Thursday, February 13, 2020

Taiwan: Potential for 32 GW of Geothermal Capacity

Taiwan’s Alternative Energy Options (Taiwan Business Topics)

The small Chingshuei geothermal power plant
 in Yilan County. Photo: Wikipedia
A geothermal power plant operates similarly to a nuclear or coal-fired steam generator but with magma buried deep beneath the earth’s surface as its heat source. Unlike intermittent wind or solar resources, geothermal power can operate continuously and serve as baseload power. However, geothermal reservoirs are accessible from only a small portion of the earth’s surface.

Located along the seismically active Pacific Ring of Fire and replete with hot springs, Taiwan would seem a likely candidate for geothermal power development. The island has a long history of exploring geothermal power, having first considered its potential in the 1970s during the two international oil crises. But while such other countries as New Zealand and the Philippines took firm measures to develop the sector, Taiwan opted for nuclear power instead, largely abandoning geothermal.

Geologic surveys conducted by the government over the years have found that the geothermal potential in Taiwan could be as high as 32 gigawatts (GW) of installed capacity, which would be sufficient to supply most of Taiwan’s power needs. The administration’s goal for geothermal is modest, though. It plans to have only 200 megawatts (MW) of capacity in place by 2025 – less than 1% of the total renewable power target.

Li Yi-heng, a senior researcher at the Industrial Technology Research Institute (ITRI)’s Energy & Environment Research Laboratories, attributes the limited reliance on geothermal to Taiwan’s geology. The island’s complex geological formations and vertical faults pose a major obstacle. Further, the most readily accessible geothermal resources are adjacent to volcanoes, but Taiwan has only one volcano – at Datun Mountain in northern Taiwan.

“It is actually riskier and more difficult to explore for geothermal reservoirs here than in Japan, the Philippines, or Indonesia – all countries that use more geothermal energy,” Li says. As with oil exploration, exploratory wells must be drilled to confirm the location of the reservoir. Drilling costs can be up to US$4 million for a two-kilometer-deep well, with only about a 30% success rate.

Most of Taiwan’s potential geothermal reserves are also located within Aboriginal lands or national parks or beneath slope lands – all areas that are off limits to development.

In addition, Taiwan lacks clear rules governing ownership of the resource once it is discovered. Most developable land is held in small, privately owned units, and any underground reservoir would likely extend beneath several private properties. If a geothermal plant were to be built on one plot of land, no regulation would prevent a neighbor from doing the same, causing depressurization and loss of resource.

The Taiwan Geothermal Association, an organization established mainly by academics, is pushing for passage of a Geothermal Act modeled on similar laws in the United States, New Zealand, and elsewhere. The aim is to clarify ownership and generate more interest in the sector. In the meantime, ITRI and academic institutions in Taiwan are collaborating with research organizations from abroad to study possibilities for exploring and developing geothermal power in Taiwan.

To offset the risks, the Taiwan Geothermal Association sought a 15% increase in the Feed-in-Tariff for 2020, but the government denied the request.  The current FiT for geothermal is set at NT$5.19 per kilowatt-hour, higher than for other renewables but still insufficient to stimulate investment, according to Lee Chao-shing, professor at the Institute of Applied Geosciences at National Taiwan Ocean University and a leading member of the Association.

The several small ongoing exploration projects are being carried out by state-owned enterprises Taiwan Power Co. and CPC Corp. Taiwan (the oil company is the only firm in Taiwan with deep-well drilling technology), together with ITRI. The largest of these projects, at Datun Mountain, will account for 150MW of the total 200MW goal for 2025.

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