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2024 ECCT & NTU Offshore Wind Seminar

The ECCT’s Low Carbon Initiative cooperated with National Taiwan University’s College of Engineering (臺灣大學工學院) to arrange a two-day offshore wind energy seminar. Opening remarks were made by Dr Chiang Mao-Hsiung, Dean of the College of Engineering at National Taiwan University (臺灣大學工學院院長 江茂雄) and ECCT Chairman Giuseppe Izzo, after which presentations were delivered in morning and afternoon sessions over two full days, many of which were by ECCT members representing companies engaged in the offshore wind energy industry.

The seminar was the first in a series of planned educational programmes, dubbed the “Offshore Wind Power Industry Talent and Technology Cultivation Project”, to be held following the launch of the “Taiwan Offshore Wind Power Talent Cultivation Alliance” funded by the Ministry of Education in collaboration with the Yunlin County Government on 5 September 2023. The main purpose of the project is to cultivate talent for the wind energy industry and educate professors and students about the domestic ecosystem and industrial supply chain for the offshore wind power industry.

The “Offshore Wind Power Industry Talent and Technology Cultivation Project” is being led by the NTU president and Dean Chiang Mao-hsiung, who is Executive Director of the project. It is also collaborating with five technological universities, namely National Formosa University, Taipei City University of Science & Technology, Chienkuo Technology University, Southern Taiwan University of Science and Technology, and National Kaohsiung University of Science and Technology, as well as corporate entities such as the Metal Industries Research & Development Centre and Taiwan Construction Research Institute. By effectively integrating resources, the project aims to create a comprehensive domestic ecosystem and industrial chain for the offshore wind power industry. It also seeks to establish a cross-disciplinary platform for industry-academia-government-research collaboration to promote local industry development, enhance industrial technological capabilities and international competitiveness. The ultimate goal is to make progress towards net zero carbon emissions by 2050.

On the first day of the seminar, presentations were delivered by the following speakers: Huang Wei-Chih, Section Chief, Renewable and Prospective Energy Development Division, Energy Administration, Ministry of Economic Affairs (EA, MOEA, 經濟部能源署再生與前瞻能源發展組科長 黃韋智); Sarah Westenberger, Aggreko Business Development Manager - Taiwan; Mei Ko, Head of Infrastructure - Trade, Department for Business and Trade, British Office Taipei (英國在台辦事處基礎工程處處長 柯新媚); Alex Tsai, Development Manager, Corio Generation (科理歐永續能源股份有限公司開發經理 蔡昇宏); Sampson Tsai, Civil & Structural Engineering Manager / OWF Yunlin Certificate Manager, Skyborn Renewables (天豐新能源股份有限公司工程設計經理/雲林離岸風場專案驗證經理 蔡欣仰) and Lee Kuan-I, Business Development Vice President, EDF Renewables (法電再生能源股份有限公司商務開發副總監 李冠億).

On the second day, presentations were delivered by the following speakers: Ethan Tsai, Director, New Energy Business Services, PricewaterhouseCoopers (PwC) Taiwan (資誠聯合會計師事務所再生能源事業服務副總經理 蔡宗達); Mark Richmond, Senior Engineer and Project Manager, DNV AS Taiwan Branch (挪威商立恩威驗證股份有限公司再生能源驗證團隊資深工程師及專案經理); Don Yang, Country Manager, Boskalis Taiwan (荷蘭商波斯卡利斯台灣股份有限公司臺灣總經理 楊松樾); YD Chang, Head of Public Affairs Taiwan, Vestas Offshore Wind Taiwan (台灣維特斯離岸風電股份有限公司公共事務資深經理 張雅惇) and Evanny Hsu, Sales Manager, Deutsche Windtechnik (德唯特股份有限公司業務經理 徐子琇).

Day 1: 10 July 2024
In his presentation, EA MOEA Section Chief Huang Wei-Chih began with an update on Taiwan’s offshore wind energy status. Taiwan currently has 328 offshore wind turbines, with an installed capacity of 2.64GW and the government target is 20.6GW by 2035 and 40-55GW by 2050. Huang cited some of challenges affecting development, including the shortage and high cost of offshore wind installation vessels, compensation and feedback mechanisms related to fisheries, and restrictions on areas where wind turbines may be located.

The government’s objective is not just to promote green energy but also to boost the local industry (particularly the development of underwater foundations, blade materials, maritime engineering and port wind power manufacturing zones). Another key aspect is talent cultivation, since the offshore wind power industry requires highly specialized personnel, which is why so many developers and universities are assisting in talent training. The government will use various talent training channels to demonstrate the future prospects of the industry as a way to attract talented individuals to join the industry. According to Huang, the government will not always protect domestic industries but will work to allow them to gain international competitiveness gradually. Regarding floating wind, the government aims to set plans and selection rules for the floating turbine sites by the end of this year, and selection to begin next year.

In her presentation, Sarah Westenberger noted that the UK and Taiwan have been closely cooperating on renewable energy for 20 years. The UK began small-scale wind power development in 2000. From 2011-2015, it became commercially viable, with most of the labour force coming from the onshore power sector. In 2015, the introduction of Contracts for Difference (CfD) provided a reliable revenue source, attracting more developers to propose investment plans. The 2019 “industrial agreement” ensured a smooth transition for oil and gas workers to wind power, with an estimated 100,000 jobs by 2030, including design, operations, and maintenance. This experience has provided a number of lessons that may be useful for Taiwan’s reference. For example, strategies need to be deployed, such as developing regional clusters and utilising mature industry and labour resources. Initially, it was expected that the workforce would come from the oil and gas industry, but due to salary differences, workers actually came from other industries. Finally, collaboration between industry, trade organisations, and the government is crucial. She stressed the importance of developing comprehensive policies, holding open dialogue with stakeholders, data sharing, establishing a common classification system (job positions and categories), and to avoid redundant training.

In his presentation, Alex Tsai stressed the importance of stakeholder management, especially consultations with the government and fishers. He noted that areas closer to the shore face more environmental issues. For example, requirements are more stringent in areas that are home to threatened species of dolphins while data needs to be collected on migratory birds. Currently, data is available for rare and protected birds, but not necessarily for more common species. To avoid bird migration routes, coordination with adjacent projects (with other companies) is necessary, and this also requires surveys. Bird surveys can be done using radar or binoculars. The disadvantage of radar is that it cannot distinguish bird species.

In addition, Taiwan’s environmental, safety, and health standards are quite rigorous. While the government’s local content requirements are controversial, procuring locally reduces shipping costs. Insurance is necessary, especially for obtaining loans and certification is needed to get insurance. An offshore wind farm costs billions of dollars. There are pre-construction, post-construction, and operational needs. Surveys are generally paid for by the developer. Loans are needed when placing orders, and repayment schedules must be clear. Taiwan’s Environmental Impact Assessments (EIA) are conducted by experts and scholars from universities serve as committee members. Given that standards are strict, it is not always possible to meet all requirements. In addition to the EIA, getting a construction permit requires the approval from local authorities and involves over 10 departments, including central and local agencies.

In his presentation, Sampson Tsai noted that the lifespan of onshore wind power is about 15-20 years, while offshore is 25-30 years. Factors affecting the cost of development include, site concentration, competition, the maturity of the supply chain, turbine scaling, lifespan extension, and the ability for continuous improvement and optimisation. The most difficult challenges are to localise the production of blades and submarine cables and install the turbines themselves and the connecting submarine cables. According to the speaker, the biggest challenge for localisation in Taiwan is not quality or technology, but the limited number of existing enterprises and their limited capacity and land availability, in the face of high demand.

In his presentation, Lee Kuan-I spoke about the potential of floating offshore wind turbines. He noted that designs for floating offshore wind turbine platforms are derived from the oil and gas industry. The difference from oil platforms is that oil platforms only require investment and investigation into a single platform, whereas wind farms need large-scale quantification and many platforms. Regarding the various types of platforms, tension leg platforms are relatively stable, which is why they have been chosen for testing in the Mediterranean. Spar platforms require very deep water to maintain stability, making them unsuitable for Taiwan. Deciding whether to place the turbine in the centre or at the edge of the platform requires careful consideration. Placing them in the centre is the most stable but is more difficult from an engineering perspective. The technical and financial barriers for floating wind are very high, and, given the early stage of development, operation and maintenance for floating wind structures are currently more expensive than for fixed-bottom types. Flexibility in turbine assembly operations is crucial and assembly requires a large amount of space, which is lacking in Taiwan. Since there is no perfect port in Taiwan, it will be necessary to coordinate among available ports.

Day 2: 11 July 2024
In his presentation, Ethan Tsai noted that energy is highly regulated industry, which is why certain reforms in recent years have been crucial to development. Back in 2009, it was mandated that Taipower must purchase electricity generated from renewable sources but in in 2017, rules were relaxed to allow electricity can be sold to Taipower or directly to consumers. Then in 2023, the installation of solar photovoltaic and geothermal energy in buildings was encouraged. Companies can now obtain green electricity either through investing in the development and construction of renewable energy plants, investing in operational renewable energy plants, signing corporate power purchase agreements, and purchasing green energy certificates.

Financing of wind projects is divided into four stages: development, construction, operation, and decommissioning. Sources of funds include bank loans, bond issuance, and bill issuance. In Taiwan, there are currently no project-specific bonds (which would require regulatory changes). Project financing is more complex than corporate financing. In project financing, all rights and assets are pledged to the financial institution. Key financial participants include banks, life insurance companies, guarantee institutions and securities firms. Risk assessments need to cover equity transfers, income sources, political risk, shareholders, credit enhancement/financing guarantees, engineering, insurance and regulations. Consultants are necessary to help banks understand the complexities of project.

In his presentation, Mark Richmond explained DNV’s project certification of wind farms, technically employed by the project developers but also working with turbine manufacturers and others. He expressed the view that costs would decrease slightly for onshore and fixed offshore wind in future, whereas the cost for floating offshore wind will decrease dramatically in the coming years. Certification increases confidence in technical integrity and reliability, which helps developers to secure investments and insurance. This is especially important for cables, since roughly 85% of insurance claims are from cables.

DNV ensures that the designs are implemented properly during manufacturing, looking at supplier qualifications and components for structural integrity. Transport and installation are also monitored and there is a final check when everything is put in place (although this is not required by BSMI). At the end of each phase, a statement of compliance is issued, and, once all phases have been completed, a project certificate is issued.

In his presentation, Don Yang stressed the importance of safety in line with a “No Injuries, No Accidents” (NINA) policy. Any employee who discovers any potential safety hazard should have an obligation to report it. Typically, maritime engineering companies support each other. Boskalis prefers to use its own ships, whereas other companies may bid for projects even if they don’t have their own ships.

Taiwan's regulations on noise and marine mammals are a combination of UK and German regulations. Small bubble curtains can be used to reduce noise during construction and they can be implemented in 1-3 layers. Procurement, construction, installation, and engineering typically occur simultaneously rather than linearly. Designers are encouraged to create designs that can actually be executed with available ships, as some designs may be beyond the size and capability of existing vessels. The biggest challenge encountered in Taiwan is local regulations, as those familiar with their construction methods may not have local certification. Therefore, they need local certified personnel to assist. Cultural differences also present a challenge.

In his presentation, YD Chang noted that there are four key aspects for a successful energy transition: Permits (the process needs to be streamlined), a robust supply chain (every stakeholder in the value chain needs to be profitable and sustainable), partnerships (everyone needs to have good relationships) and investment. On the subject of local production, he said that, while quality is good, it is more expensive due to the lack of economies of scale. He noted how his company is helping to develop local talent. For example, as projects in Taiwan are completed, locally trained personnel may be offered the opportunity to move with the company to work in Japan or South Korea. He noted that Japan and South Korea do not have stringent localisation requirements, unlike Taiwan.

In her presentation, Evanny Hsu noted that developers may want to handle operations and maintenance (O&M) in-house, but often can't manage everything, so they collaborate with O&M companies. Underwater construction work relies on remotely operated vehicles. Engineers are generally assigned indefinite contracts. Experienced foreign engineers are mentoring local engineers through an apprenticeship system. Training in the first year focuses on enhancing safety awareness and basic technical training while more advanced training begins in the second year.

Challenges in Taiwan include increasing costs, lack of skilled personnel, personnel training must meet local regulations and developer requirements and difficulty in securing marine vessels. The lack of English proficiency is also a challenge. In addition, Taiwan's offshore environment is more severe than Europe's, with greater variations in underwater currents. While the career lifespan of engineers is not very short, maintaining physical fitness is necessary. She noted that more oil developers are shifting from existing operations to participate in the offshore wind industry. The company has started testing the use of drones, but this is still in the early stages.