Taiwan's Geothermal Energy Challenges and Institutional Gaps
Taiwan's geothermal potential remains largely untapped due to institutional weaknesses rather than resource scarcity. As demand from sectors like semiconductors is projected to exceed 5 GW by 2030, effective risk management and institutional support are critical to developing this energy source.
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Taiwan Power Co (Taipower) anticipates a significant increase in electricity demand, particularly from the semiconductor and AI sectors, which may exceed 5 GW by 2030. Despite having an estimated geothermal potential of 40 GW, only about 10 GW is considered developable, with current operations limited to shallow resources.
The lack of mechanisms to mitigate exploration risks inhibits private investment in geothermal projects. In response, Taiwan's Ministry of Economic Affairs (MOEA) has proposed amendments to the Renewable Energy Development Act, paving the way for clearer legal frameworks and targeted feed-in tariffs for geothermal energy.
However, sustaining cooperation across agencies remains a challenge. Japan's experience highlights that institutional capacity does not guarantee successful resource development, as local opposition has hindered geothermal exploitation despite significant reserves. Taiwan must develop robust institutions capable of managing long-term energy risks beyond political cycles to realize its geothermal potential.
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