Cross-border grid connections are emerging as a key strategy to integrate renewables and accelerate global decarbonization. (Photo: iStock)
Taiwan, surrounded by water on all sides, operates an islanded power grid with no connections to neighboring countries. In the event of an energy crisis, it has no external support to fall back on. As a result, effective power management by the state-run utility Taipower has become essential. Yet as countries across the world deepen cross-border electricity cooperation to accelerate decarbonization, regional power grids are emerging as a major trend—one Taiwan can no longer afford to overlook.
In our special series Rewiring Asia, RECCESSARY explores regional grid developments around the world and assesses their relevance and feasibility for Taiwan, analyzing the key opportunities and challenges on the road ahead.
Cross-border grids rise as a tool for net-zero transition
The concept of regional grids—cross-border electricity networks that link renewable supply with demand centers—is gaining traction as countries search for efficient, scalable ways to decarbonize their energy systems.
Momentum has also reached Taiwan. At an October 2023 reception for the launch of an Indo-Pacific Strategic Think Tank, Taiwan’s Minister of Economic Affairs Kuo Chih-hui (郭智輝), floated the idea of joining the U.S.-Japan-Philippines-backed “Luzon Economic Corridor.” As part of this initiative, Taiwan could potentially invest in power plants in the Philippines and import green electricity to help meet its 2030 goal of achieving 30% renewable power generation.
Similar ideas surfaced during COP29 in Baku, Azerbaijan. One major initiative was the “Green Energy Zones and Corridors,” aimed at enabling long-distance power transmission between renewable energy-rich regions and major consumption zones through regional grid integration. These developments sparked renewed discussion about Taiwan’s future in a regional grid system.
Why regional grids are gaining momentum
What’s driving countries to link their national grids? According to RECCESSARY green power analyst Julia Hung, three main reasons are accelerating regional power grid development:
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Energy security: Regional grids enhance supply-demand balance and improve energy resilience across borders.
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Grid flexibility: With the rise of intermittent renewables like solar and wind, and extreme weather risks, cross-border power sharing improves grid reliability and cushions local vulnerabilities.
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Cost and access: Regional grids enable cost-effective green electricity to flow into high-demand markets, reducing overall reliance on fossil fuels and lowering energy transition costs.
Professor Lu Chan-nan (盧展南) of Taiwan's National Sun Yat-sen University adds that regional grid integration helps resolve surplus issues. When areas generate excess renewables—sometimes even resulting in negative electricity prices—cross-border delivery can match supply with demand, helping achieve global climate goals.
The EU’s model: Political will and transparent governance
Among global examples, the EU stands out as the most mature and advanced regional grid. Hung notes that the EU succeeded due to strong political consensus, economic cooperation, and technical alignment, supported by a transparent cross-border regulatory system.
The European Network of Transmission System Operators for Electricity (ENTSO-E) coordinates over 400 cross-border links across 36 countries. It sets standards to ensure grid safety, enhance renewable integration, and promote electricity market development. The EU has mandated that each member state must be able to export at least 15% of its electricity to neighbors by 2030 as part of its energy security strategy.
The EU’s 2030 target of 15% interconnection requires each member state to export at least 15% of its electricity to neighboring nations, supporting Europe’s energy security strategy. (Photo: iStock)
According to ENTSO-E, the EU will add 23 GW of new cross-border capacity by 2025 and 12 GW more by 2030, totaling 136 GW. However, delivery delays—averaging nine years per project—have already caused bottlenecks. Germany’s grid operator Amprion reported in 2022 that limited interconnection hampered electricity trading.
Still, regional interconnectivity helped the EU during energy shocks. In 2022, France suffered an energy crunch due to reduced gas from the Russia-Ukraine war, nuclear outages, and drought-driven hydro shortfalls. Emergency imports from the UK and Spain alleviated the crisis.
The ASEAN Power Grid: Ambitious goals, modest progress
ASEAN launched its regional grid concept in 1997 to address rising electricity demand and support renewables. But progress has been sluggish—only 9 of 18 projects are complete, with a current cross-border capacity of 7.7 GW. The goal is 17.6 GW by 2040.
Of the 18 interconnection projects planned under the ASEAN Power Grid, only 9 have been completed to date. (Photo: ASEAN Centre for Energy)
The most advanced project is the Laos-Thailand-Malaysia-Singapore Power Integration Project (LTMS-PIP), now in its second phase. Singapore currently imports 100 MW from Laos via Thai and Malaysian grid infrastructure and plans to double this. The initiative supports regional decarbonization and investment in renewables.
However, technical and financial barriers remain. Countries must upgrade infrastructure to handle higher renewable penetration and maintain grid compatibility. More crucially, many nations prioritize domestic green energy needs, adding uncertainty to cross-border export commitments.
Can Taiwan import power from the Philippines? Two preconditions for progress
Given global trends, is Taiwan ready to join a regional grid? A 2020 ScienceDirect study explored a Japan-Taiwan-Philippines high-voltage subsea interconnection to enable broader Asia-Pacific electricity trade. While still theoretical, it inspired discussion around an “Asia-Pacific Super Grid.”
Based on interviews with cable manufacturers, green energy companies, and local scholars, RECCESSARY identifies two critical conditions for Taiwan’s participation:
1. Political trust is the foundation
One foreign solar developer stressed that cross-border grids are not just economic—they hinge on diplomatic trust. Taiwan’s limited formal allies make it vulnerable to one-sided contract terminations. “If Taiwan can’t even deter unauthorized flyovers, how can it safeguard undersea cables?” he said. Taiwan must first build diplomatic ties to secure future energy collaboration.
2. Market openness and infrastructure access
Professor Lu advocates opening Taipower’s grid to foreign investors to attract capital and ease infrastructure bottlenecks. “If Taipower alone bears the financial burden, many plans may fall through.”
Zone-based power trading rules and spot/futures markets are also missing in Taiwan. As Taiwan’s HD Renewable Energy CEO Chou Shih-chang (周仕昌) notes, the country lacks even domestic power exchange mechanisms—let alone cross-border ones. Liberalizing the power sector is a prerequisite for any future regional grid.
Taiwan must rely on subsea cables to build regional grid links. (Photo: iStock)
Political risk looms large
Unlike many Southeast Asian countries, Taiwan must lay undersea cables to build a regional grid. But rising cross-strait tensions have escalated risks. A January incident involving suspected sabotage of submarine cables by a China-linked vessel off Taiwan’s coast highlighted vulnerabilities.
Hung warns that Taiwan must secure reliable partners to ensure affordable and stable power—even amid climate and geopolitical instability.
Despite the challenges, regional grid integration is a growing international norm, especially as countries pursue differentiated roles in a shared net-zero future. Taiwan may still be far from joining—but in the long run, staying isolated could prove more costly than stepping forward.
Sources: ENTSOE, European Commission, Ember, EMA, The Straits Times, ScienceDirect
'Rewiring Asia' special series
- Rewiring Asia: How global and ASEAN grids inform Taiwan’s next move
- Rewiring Asia: Inside Singapore’s strategy to build a regional grid for clean power
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