Source: News Bharati English19 Jun 2017 13:43:11

Taipei (Taiwan), June 19: With an aim to increase the share of renewable energy such as water, wind and solar from 5% currently to 20% of total power output on the island by 2025, Taiwan’s government is starting to map out funding plans for $59 Billion for a power system that can no longer rely on nuclear reactors.

With the ideology ‘New energy, meet new finance’, Prime Minister Lin Chuan’s government hopes to attract NT$1.8 trillion ($59 billion) of private capital. He said that developing funding channels will be critical, given the ambitious target.

Bloomberg New Energy Finance’s September assessment stated that Taiwan might only raise the share of renewable energy in electricity generation to 9.5% by 2025 in part because of the lack of a developed supply chain for the new sources of power.

The island’s government’s set challenging targets for 2025 says that the 45% of the thermal coal’s share in electricity production is to get lowered to 30% from 45%, to eliminate nuclear power, which currently accounts for 14%, Available 32% share of natural gas to be raised from 32% to 50%.

The island’s government’s set challenging targets for 2025 also said to try and attract investment, authorities will guarantee purchases of the resulting electricity. Lin Chih-chi, director general of the department of planning at Financial Supervisory Commission said that Taiwan’s green finance is still at an early stage and there will be a lot of business opportunities.

Some challenges faced for achieving targets are the potential of green finance depends on government promotion informed vice president of Chinatrust Commercial Bank in Taipei, Phoebe Li. She said local banks having lack experience financing green energy especially in wind power need to team up with foreign banks, she says

Chief executive officer of corporate banking at Cathay United Bank, Daniel Teng informed that there’s steady growth in green loans every year. He also said, “Valuation for wind deals is fairly difficult; Taiwan needs more talent and consultants in the area”. Green finance deals were more profitable a few years ago; now there is more competition on pricing, he added.

Earlier in February, Chen Chung-Hsien, a senior specialist at the Bureau of Energy in Taiwan’s Ministry of Economic Affairs, said that some local banks are quite conservative in lending, especially for offshore wind projects. Local banks have more appetite for solar projects.

Taiwan is making progress in the green bound sector, a type of security also being endorsed by Apple Inc. after rolling out rules for them in April. Four banks of Taiwan have sold the first batch of green bonds. A petroleum and natural-gas refinery is planning to issue green bonds by the end of this year.