Ørsted wins bid in Taiwan offshore wind auction

Taiwan’s Ministry of Economic Affairs has announced the outcome of its first offshore wind auction. Ørsted was awarded 920-MW capacity for its offshore wind sites in the Changhua region. Subject to Ørsted obtaining relevant permits and taking final investment decision, the projects are to be built in 2025. Ørsted’s winning bid price was TWD 2,548 (about $84.26) per MWh.

“Following a highly competitive auction process, we’re very pleased with adding further value-creating capacity in Changhua,” said Martin Neubert, Executive Vice President and CEO of Ørsted Wind Power.

Ørsted has a total offshore wind pipeline in Changhua of 1,820 MW, including the 900 MW that were awarded to Ørsted in April.

“The results are promising for Taiwan’s transition to renewable energy,” added Neubert. “The outcome of the auction proves once again that when governments commit to ambitious buildout targets and create stable, transparent, and good framework conditions, the offshore wind industry will deliver.”

Ørsted’s bid was based on the following drivers:

• The projects awarded in the April grid allocation at a higher feed-in-tariff will help facilitate the investments required to establish and mature a local supply chain. This will reduce costs and risk on the projects awarded toward the final investment decision in 2023.
• Further cost-out in the industry towards final investment decision driven by technology advances (e.g. larger turbines).
• Scalable O&M, which means operating all of the Greater Changhua projects from the same hub.
• Transmission synergies: With the capacity added to the Changhua portfolio,Ørsted says it will be able to fully use the transmission asset.
• Learnings from the first Greater Changhua projects, which are to be procured and constructed in 2019-2021, and increased presence in Taiwan over time, it will enable a  more efficient and optimized EPC process on the projects awarded, which are to be procured and constructed in 2023-2025.

“Ørsted has come to Taiwan and set up its Asia-Pacific hub here,” explained Matthias Bausenwein, General Manager for Ørsted in Asia-Pacific. “We are very happy to see the offshore wind industry in Taiwan mature and to be able to significantly contribute to this development. With the additional projects in 2025, we have a solid pipeline on which we will further strengthen our local presence.”

The next step for Ørsted’s projects is to obtain the establishment permit and to secure the feed-in-tariff by signing a power purchase agreement with Taipower. Subject to Ørsted taking final investment decision, Ørsted will start construction works in 2023 and expects the projects to be commissioned in 2025.