TRENA PODCAST《島嶼風光》全新系列，每月更新一集 全英文podcast🤩 TRENA Talks
🎤主持人：台灣再生能源推動聯盟理事長-孔榮＆台灣再生能源推動聯盟副理事長-張雅惇
TRENA Talks is a Clubhouse series that explores the current landscape of renewable energy in Taiwan. It is aimed at English speakers in Taiwan and international listeners who want to learn more about Offshore & Onshore Wind, Solar PV, Geothermal, Biomass, Small Hydro Power, Ocean Energy, Wave Energy, and other forms of renewable energy in Taiwan. We discuss Taiwan’s energy policy, initiatives, and technical and social developments with selected guests and room participants. Join us at the Taiwan Renewable Energy Alliance (TRENA) Talks for insightful discussions and expert perspectives on Taiwan’s journey towards a sustainable future and net-zero emissions.
Raoul:
Welcome to the first episode of "Trena Talks”." My name is Raoul, and I'm the chairman of the Taiwan Renewable Energy Alliance. And I'm very pleased to join today by my co-host, YD, who is also the vice chairwoman of Trena, and our very first guest, Liming Qiao, who is head of Asia for the Global Wind Energy Council, which was one of the leading industry associations. And I had just a peak view at your 2024 report; GWAC reports are always great because they can inform very fast, yet touch upon many central and deep issues. The repot shows how GWAC facilitate onshore and offshore wind across the globe, different tools to offer assistance for members and governments.
YD:
Welcome to our clubhouse/podcast. We are excited to kick off our new monthly series, where we'll be diving into everything of renewables. For those interested, we also host a weekly clubhouse in Chinese by me and Ruping. Ruping is also online, making it also a podcast series. We thought there is no better way to start than with a big picture look at the state and future of offshore wind in the Asia Pacific region by Liming. And we're thrilled to have Liming with us today and really appreciate she takes the time to join us.
Liming:
I am Liming Qiao, in Chinese, the head of Asia of the Global Wind Energy Council, GWAC. I am very glad that Raoul mentioned our Fact Sheet report. One of them is the Global Wind Report, which we publish in the first quarter of the year. The other is the Global Offshore Wind Report, which we always publish end of the second quarter in the year. In those reports, we try our best to capture not only the first industry of the wind energy development status, but also capture all the key issues around the world that is affecting the deployment of the technology. As the Wind Energy Association, our main mission is mainly two folds. One is to represent the wind energy industry at different international policy forums, like Irena, IEA, International UFCCC, the COP, the Climate Negotiation Process, being the voice of wind or renewable energy industry. Our other mission is to give whole wind energy industries and new frontiers a hand to enter into new emerging markets.
As the head of Asia for GWAC, I am based in Singapore, leading our regional team of 13, which soon will be 16 by the end of the year, or beginning of next year, covering East Asia and Southeast Asia.
YD:
We've known each other for five years, and our work in Taiwan market has been a good starting point, where everything starts in Asia in term of offshore. We have seen industries are moving on from Taiwan to other markets. Those five years is also like the trajectory of how wind offshore really moves from one point to the rest of Asia, which mirrors the growth of offshore wind in Asia as a whole. I want to discuss how the sector is flourishing across the entire region."
Raoul:
What did you do before? How did you end up for working in such a global association?
Liming:
I have only had two jobs so far; I have been with GWAC since 2008, which is a significant part of its history, as the organization is less than 20 years old. Over my past 16 years, I have witnessed GWAC's transition to being much more involved in policy. Before that, I worked with WWF in 2003, and focused on climate and energy policy. At that time, climate change was still a marginal issue, and had to explain what it was. Over the past two decades, I have seen climate change rised to the top of global agenda, and also observed the wind industry evolving from a niche sector to a key driver of the energy transition.
YD:
This year, we celebrated the completion of the Yunlin Project, a 640 MW project that has finished installation and is now online. It follows the successful coneection of the Greater Zhanghua Project, like Washi, as well as Zhang Hwangxi, Dao, and Zhonglen by CIP. We have nearly 3 GW of capacity now operational in Taiwan, and looking forward to upcoming projects, Hai Long, which is on the track to meet its deadlines. Overall, we have a solid foundation in place, thanks to the hard work of everyone involved.
Rauol:
On the other hand, six years in offshore wind can feel like dog years—one year feels like seven. Next Monday will be an important milestone in Taiwan, as the Ministry of Economic Affairs has set a deadline for signing administrative contracts for Round 3-2 projects. However, 3-2 projects are proving to be difficult, as negotiations are still ongoing, and Round 3-1 is also facing roadblocks.
One of the things after COVID was the massive inflation shock, in addition, driven by the Russian-Ukrainian war, which pushed up all the costs, higher financing costs. It leads to the difficulties in Taiwan energy market regarding policy design. Even though Taiwan is now facing a tough time, with subsidies no longer in place and the transitions to more open market, People are still working hard to navigate these challenges under underlying sense of uncertainty.
Rauol:
How does it look like in the rest of the region? Where are the leading, or upcoming markets? Is the issues in Taiwan similar in other markets?
Liming:
Taiwan issue is very different from other markets. Taiwan has made remarkable progress in a very short time, and set up an example for the rest of the Asia-Pacific region to follow, which makes people to believe this is not European matter, and this can be replicable in Asia. In terms of Taiwan's experience, it still remains the case, despite all the challenges faced.
Looking back to the rest of APAC for the past five years, there have been various concerns and challenges surrounding energy transations, which made whole talk about off-shore win and the success of Taiwan, was picked up by other markets. However, many major markets with profitable and viable offshore wind resources have developed targets to make the starting point. These targets have been publicly announced and incorporated into national energy plans at a different stage, they are all in the process of introducing policy frameworks to be met. Few are on the top of the list, Korea is a very promising market, which has a target of 14 GW of offshore wind capacity by 2030. It has already implemented a two-stage auction process to cover offshore wind project. This makes South Korea an exciting market, drawing significant attention. Apart from that, Australia is also picking up quite quickly, and more rounds will be open in the future.
The Philippines is another fast moving market, which has surprised many people. Over the past two years, new president is pushing for offshore wind projects as a part of his legacy. The Department of Energy (DOE), the Energy Regulatory Commission (ERC), and others have been actively involved in this push. A key development is the completion of the Omnibus Guidelines introduction to clarify the off-shore wind service contract terms. Additionally, the EU has streamlined the permitting process, and the Green Energy Auction Program, which has been running for two years to cover all renewables, will soon include offshore wind next year. These rapid developments have impressed the region, positioning Philippines to be the first off-shore wind market in Southeast Asia region.
Vietnam has been a key focus for GWAP over the past five years, following the works in Taiwan. However, the past two to three years have been challenging due to political stagnation, which has slowed policy development. Despite this, country has set ambitious offshore wind targets in its PDP-8, to which we have contributed. Unfortunately, the slow pace and policy delays have frustrated many international players, leading some to retreat from market past year. Recent changes in political leadership have sparked a sense of momentum in Vietnam. All those past two years that we have been waiting in the tunnel, waiting for the light at the end of the tunnel, we finally are getting very close to the progress. While the industry still faces uncertainty, especially as some players reconsider their involvement, we believe Vietnam remains a market to monitor.
Rauol:
Speaking of Philippines, I was in charge of our Manila office, and we have actively involved in the offshore wind sector. It was truly exciting when the World Bank released its report on the industry in 2021-2022. Marcos Jr. clearly committed to offshore wind serioudly, which was pretty much similar to Taiwan in 2016. We have involved in some of the projects aimed at supporting government. While it was challenging to coordinate and navigate various obstacles, the government made significant efforts to push things forward. If something didn't work out, they would find any alternatives to overcome it. Speaking of Vietnam, it presents an interesting business opportunity, but similar questions come up when considering Taiwan's current market conditions.
Rauol:
How do you level off all these different markets? Take Japan and China, for example — they often experience fluctuations, ups and downs. If things do not work out in Vietnam, can you pivot to Japan instead?
Liming:
As I mentioned, all these markets are in the early stages, right after the targets have been set. The next step is implementing the policy framework, and each market is at a different stage in rolling out that framework, providing opportunity to differentiate which one moves faster, which one needs to be strategically later, or which one is immediate market to go, and it opens up for market comparison. Global inflation and the interest rate are making industries under a huge stress, and will limit their freedom on making more choices or giving more time to assess all these different APAC markets. People or industries expect immediate result or short-term result under much more stress for the past half year. Reflected by the retreat in the Vietnam, regional players or large international companies are not just in one market, they start to compare Japan, Taiwan with US, Europe. They go through their portfolios, and are frustrated by the process in one country. Even though they were very closed to a project, they still decided to give up reluctantly. It is not just Vietnam, Korea, or Taiwan, several companies just pull out from projects, because they can not afford waiting.
We felt quite fortunately that we are still able to stay in the market, because you need to be there and push the last miles and make things happen, important things need to be put into place. First is the whole policy framework must be properly introduced to the market, in most of the markets. The framework used as internal process or term breaks down into four pillars, planning, leasing, permitting, and auction or off-take process. Frequent interactions between leasing and tauction pillar, depending on one-stage or two-stage auction process in order to make sure it will be properly introduced. Apart from whole policy framework, there are supply chain development policy, financial issues, and infrastructure policies. Finance is our focus for the past few years among different markets, because it can contribute to the reduction of the LCOE, like 1% of increase in the cost of finance can lead to roughly 8% of LCOE increase. Therefore, we spent our effort briding the gap between developer and financiers on understanding the perceived risk of off-road wind in new emerging markets, and try to minimize some of PPA bankability issue in Philippines and Vietnam.
We are also looking into some of the other issues, how can we bring other sources of funding into this? Can we bring in more institutional players? Can we introduce the blended finance structures, especially in Southeast Asia regions, for the build-up of the first few gigawatts of the projects? And that's why we are going to have an Asia Pacific Wind Summit in Korea. That's one of our flagship event that GWAC is doing. We start our first finance summit this year, bringing IRENA and ADB as co-partners for new innovatives, like financial structures and new source of funding, in an attempt to attract and start conversation. IRENA also bring forward proposals to see whether we can replicate the success of the Africa Renewable Energy Investment Forum for Asia.
Rauol:
You can't be everywhere, there are so many topics. How do you work with these? a lot of funding from members, do you team up with other associations or super-government agencies?
Liming:
Collaboration, collaborative approach is our fundamental approach. When we work in different markets, entering into new markets, we always work with the local associations. In the 18s or the 19s, It was quite easy for us to work with Chamber of Commerce, ECCT; that is our DNA. Our Singapore headquarter started our Vietnam office about two years ago. Now we have three people in our Vietnam office. And last year we started our Philippine office with our country manager there. End of this year, we will have our first country manager in Korea and Japan.
Back to Korea, you have different events across Asia, but you changed to “flagship event” and every market. It’s not just about Korea, we actually started with Taiwan, Global Offshore Wind Taiwan, Global Offshore Wind Japan in collaboration with GWPA. And different names or different brands, we had Vietnam Wind Power, Vietnam wind power event. It's a small team to go around all these markets to do this; we started APAC Summit idea. APAC is totally different from the Europe market, It's much more easier to do in the European Union(EU), not similar to Asia individual market. We are facing challenge of making it Asia Pacific Union; we did put efforts into closed door forums for the government, and open door forums for different policy topics, which we are really good at initiating policy conversation.
The finance summit is another trial to make more political conversations to back this whole concept. We make the APAC summit a place for the governments to discuss the regional issues, such as solutions or collaborative matters. This is the second year that we are running the APAC, Asia Pacific is not the European Union; It doesn't have the same concept of EUAsian, nor does the ideas of cross-border trade, labor and finance freely flowing.
In the finance summit, neighboring countries can learn from each other’s experiences. This exchange fosters collaboration, turning meetings into meaningful discussions that lead to solutions. For example, our Minnesota Economic Affairs team is exploring power cables to the Philippines and Japan. This could create lasting, positive impacts and a long-term legacy for the APAC region.
Rauol:
What has been your or your GWAC's success this year? Which project stands out as the most satisfying or represents a breakthrough in the region?
Limning:
As I mentioned, we have invested time and efforts in the Southeast Asia region, particularly in Vietnam. We have observed the pilot mechanisms being developed, like the first gigawatt installation now being set in motion. Initially, we engaged with state-owned enterprises; every gigawatt installed contributed to cost reduction, streamlined infrastructure, and supply chain, which will lower the risks for future products. We also worked on the auction process for holding and selecting investors in Vietnam, generating in an auction report at the end. We have the finalized version ready, and deliver to IMOI tomorrow. I am here this week to oversee that. This report establishes the two-stage auction process, which has been integrated into the year by government.
In recent months, our Vietnam team successfully conducted a study tour with the National Assembly, where we introduced the two-stage auction process. We are pleased to incorporated into the new electricity law draft, consolidating the two stage auction process, even though the movement is still in that tunnel.
Rauol:
When you presented the auction design to Vietnam, was it a universal auction design for all markets, or did you work with both sides to fit for each market? Is there one auction design that works globally?
Liming:
We’ve simplified the auction design to a one-stage or two-stage process, and it’s up to each country to decide based upon their resources. Once a country opts for the two-stage process, it provides a general guideline for how it should be structured. However, it still needs to be contextualized into the local circumstance. This is why we prepared the auction report for Vietnam, to elaborate two-stage process can be implemented there.
Rauol:
When you refer to a one-stage and two-stage, what are the differences between these two?
Liming:
One-stage means leasing and auction combined into one, and government steps in doing the early stage development measurement and sharing data with developers for the auction bidding. Two-stage means leasing process separated from the auction. people use their own funding for measurement, and then use that data to prepare for stage two auction, in an attempt to determine the tariff, the PPA. That's why it actually quite matters that government get a better understanding of the four pillars, route to market a decision on one-stage or two-stage. Once you make your decision, you develop planning, leasing, permitting, auction policies to enable you on the right track. And there is also a time sequence factors to this, you need to do planning first before you start the leasing process, and so on.
Rauol:
So, lessons learned, some major markets and the upcoming ones, why do you believe the later commerce will definitely benefitial and be able to reap the benefits?
Liming:
I am looking forward to the flagship event in South Korea. We have invited National Assembly speakers, who is the number two after the president, to present in the event. We also have the minister at our event, supporting the event at different sections, like Asia Pacific Regional Government Delegation, which has been brought in by World Bank. We also have IRENA, the DG, the deputy director of IRENA are also coming. The ADB is coming, institutional wise or government wise, those are the highlights.
The Korean event, in terms of topics, day one will be the APAC Regional day, day two will be the Korean day. Day three is a half day, which focus on transition, socioeconomic, or job issues of the offshore wind. That will be diverse sources for offtakers in the region for renewables. We devoted efforts to include APAC to one event so that you don't have to travel around for the impacts.
YD:
Which market outlooks in APAC for next year?
Liming:
The Luzon Economic Corridor in the Philippines was established this April, marking a new phase of regional collaboration between the US, Japan, and the Philippines. However, questions remain about the future of international cooperation with the US and how they will engage in the region. On the other hand, the challenges in the supply chain also present opportunities for countries within the region. It’s a two-way thinking. Unlike the more pessimistic German worldview, which sees everything as bound to break down, this situation offers something to look forward to.
Esther is also here, Esther is my colleague in GWAC, and she leads our Japanese team, very important market in the region.
Esther:
Japanese market is taking a careful, step-by-step approach to ensure that every move yields results. GWAC is optimistic about the future of floating offshore wind development in Japan, with strong government support to build a supply chain. They’re also collaborating closely with international governments to establish a system that works for Japan. Floating offshore wind is definitely a sector to watch in Japan in the coming year, and I’m very optimistic about its future in the region.
Conclusion:
Looking at Korea and Japan, Japan has made some progress, especially given its geographical advantages. They have vast capacity to expand if they fully tap into floating offshore wind. In Taiwan’s case, if the government had the courage to take bold steps like they did in 2016, they could become a regional leader. There’s still time for Taiwan to seize that opportunity.
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