Taiwan’s offshore wind localization policy has been challenged by the EU at the WTO. The Bureau of Foreign Trade is expected to hold consultations with the EU in September. (Photo: iStock)
Taiwan should revisit its offshore wind localization policy to capitalize on its strengths and better adapt to the maritime climate, according to Chien Lien-kuei (簡連貴), chairman of the Taiwan Wind Energy Association, in response to EU accusations at the WTO of discrimination against foreign companies.
The first consultation between Taiwan and the EU on this issue, following similar concerns raised by the EU three years ago, is scheduled to take place in September, under the purview of Taiwan's Bureau of Foreign Trade.
Taiwan considers policy revisions to refocus strengths
The original intent behind the localization requirements for Taiwan’s offshore wind energy sector was not only to promote green energy but also to spur domestic industry development and ultimately align with international standards.
Chien noted that many countries like the EU, Japan, and the U.K. have adopted localization policies to drive offshore wind energy development, supporting local industries and creating jobs.
For foreign offshore wind developers, assembling locally and leveraging local supply chains and talent can be advantageous in the long run, he added.
While Chien acknowledged the need for localization, he pointed out that Taiwan's offshore wind energy sector cannot replicate foreign models due to the country's unique maritime and geological conditions.
In addition to earthquakes, typhoons, and unique seabed geology, recent discoveries of sand waves and environmentally sensitive areas underscore the need for Taiwan-specific solutions.
Chien also agreed that Taiwan should consider easing its localization requirements, providing an opportunity to review the policy's direction and focus on projects where Taiwan holds a competitive advantage.
While the initial lack of expertise and long lead times led to high costs in localizing offshore wind projects, Taiwan is now more integrated with international standards.
The Taiwan Wind Energy Association believes that Taiwan’s offshore wind energy sector cannot replicate foreign experiences and needs to adapt to the country’s maritime and geological conditions. (Photo: iStock)
EU calls for WTO rule compliance since 2021
Taiwan’s Ministry of Economic Affairs (MOEA) has been signaling a shift toward a more open stance regarding offshore wind energy development. Minister Kuo Chih-hui (郭智輝) acknowledged the EU’s strong interest in this issue, stating that the ministry is preparing for the September consultation with the goal of finding a solution acceptable to both domestic and foreign stakeholders, in line with WTO principles of fairness.
The EU's focus on Taiwan’s localization policies stemmed from a WTO dispute settlement meeting held on July 26, where the EU requested consultations with Taiwan over its offshore wind localization policy.
The EU noted that while it supports Taiwan’s renewable energy efforts, Taiwan must respect fair global competition and comply with international trade rules. The EU also pointed out that Taiwan’s localization ratio and incentive standards for offshore wind farm capacity allocation are inconsistent with its WTO commitments to non-discrimination against like products from foreign countries.
This issue was first raised in 2021, during the second phase of Taiwan’s offshore wind energy development. At the time, Filip Grzegorzewski, head of the European Economic and Trade Office, and Cristina Lobillo Borrero, director of the Energy Platform Task Force at the EU Directorate-General for Energy, both stressed that Taiwan’s localization requirements should comply with WTO rules, helping the industry rather than imposing impractical bureaucratic demands.
In addition to localization requirements, global factors such as inflation, high interest rates, and soaring costs for critical offshore wind components—exacerbated by the Russia-Ukraine conflict—have increased the pressure on developers.
If no mutually acceptable solution is reached within 60 days of consultations, the EU may request the formation of a WTO expert panel to issue a ruling, potentially adding uncertainty to the future of Taiwan’s offshore wind energy development.
