The collapse of the Ho-ping electrical tower and the heat waves struck in the recent two weeks that caused power crisis, have highlighted current Taiwan’s centralized energy system fragility. In face of this crisis, although commentators believed that nuclear plant 1 and machine 2 of plant 2, whose fuel pool have already reached their upper limits, should be restarted to survive the crisis. However, this research team believes that we should follow Seoul South Korea’s example, who after a major blackout in 2011, has realized the importance of decentralized energy systems, thus vigorously promoted the “saving a nuclear plant” policy. To this power crisis, as to promote Taiwan's energy transformation social driving force.

In order to systematically promote energy transformation, we will only rely on the "2025 renewable energy ratio to 20% as total generating capacity" and "Green energy enters forward-looking infrastructure", it is necessary to fundamentally review past energy lacking of governance mechanism, strengthen system capacity, that can help comprehensive transformation. The Executive Yuan in April this year, after the revision of energy development program, in July to start energy transformation white paper development process. Compared to the experts in past National Energy Conference, management Departments will work with thinking tanks to put forward various action plans, and then let parties concerned to discuss various programs. This white paper development process, for the first time sets decisions to open the issue to the public, with the district preparatory meeting and network to seek multi-party views, and then by the representatives of multi-representative working groups in co-production format, translating recommendations made at the preparatory session into operational action programs. After the completion of the first draft of white paper, then through civic meetings, public meetings, network consultation and other multiple channels, once again go for social dialogue.

This program is designed for domestic policy for the first time, with public policy to participate in the exemplary role of people. However, in terms of the impetus for energy transformation, the decision has three factors in the effectiveness of this mechanism:

1. Fully integrated across departments: energy transformation is highly relevant to carbon reduction, air pollution control, land planning and public transport promotion, therefore, it is necessary to achieve full integration between department policy objectives and the promotion measures;

2. To create collaborative atmosphere: in the past because of national energy conference were more limited to two issues of nuclear power and energy industry restructuring, intensified representatives’ opposition. Therefore, this time, it is important to emphasize that this White Paper is a non-nuclear-based approach to the need to achieve carbon reduction target and a way to ensure energy security, to promote authorities, industry, academics and citizens’ groups 4 representatives can "collaborate" instead of "confrontation";

3. Decision-making Information Transparency: In white paper development process, sufficient decision-making information is required, such as energy structures that can achieve 2030 national reduction targets, various power generation technology cost forecasts, and natural gas removals. In order to avoid information is not equal, weaken social trust.

Based on this analysis, this Center will first analyze the shortcomings of policy integration due to the restriction of "ministry selfness" in existing white paper plan, after the analysis of "energy management", "energy efficiency promotion" and "power supply planning" three areas, put forward action plan proposal. 

Break department selfness, thick planting control capacity

Looking at the meeting information of the White Paper on the energy transformation, the only project that is called a substantive policy objective is "To achieve 20-30-50 clean energy (Power generation) structure in 2025 to implement a non-nuclear home", without mentioning another important factor in energy development -"Greenhouse Gas Reduction Target". If the writing of this white paper, only considers power structure, it will lose transport sector to promote the goal of low carbon, and cannot respond to people’s concerned about the petrochemical industry restructuring direction that accounted for 14% of carbon emissions. Furthermore, in accordance with the provisions of greenhouse gas Emission Reduction and Management Act, Environmental Protection Agency should propose a greenhouse gas emission reduction program that includes phased control targets this year. The transformation of energy since it is the key to the implementation of reduction goal in Taiwan, the transformation of the White Paper in development, but because the difference of Environmental Protection Agency and Energy Bureau two departments, failed to be included in discussion, not only cannot seek combinational effect between two policies, also because of the inability to respond to the questions of "non-nuclear" and "carbon reduction" that cannot be reconciled and weaken the social persuasiveness of policy.

In addition, the white paper issues, the other Department selfness example: the energy conservation in this issue, is divided into "People's livelihood energy saving sector" and "Building sector energy saving" two action plans. Detailed study of projects can find the former only contain energy saving under the jurisdiction of cities and counties energy conservation, electrical energy efficiency improvement, the latter refers to the Ministry of Interior in charge of green building promotion, lifts energy efficiency constructions, etc., due to the authority of departments, the implementation of division, in fact, cannot respond to international community now on the home sector positive attention energy transformation in building energy expose, near zero energy building standards, building energy passports and energy-saving financing integration policy tools.

The transformation of energy involves in a number of ministries, therefore can the study of white paper contribute "Mainstream of energy transformation", and it is the key to follow-up energy governance. However, if we inspect transport sector consumes energy accounted for 12%, in proposed action plans, no electric car promotion program or international concern of low-carbon maritime transport, but non-energy transformation-driven "Roundabout railway electrification" and the limited impact of "Sea and airports facilities services electrification (bridge shore electrical equipment)" entered action plans, coordination degree is even lower than "Air pollution control strategy" proposed in April this year. In "Air pollution control strategy", the Ministry of Communications has also made positive proposal to enhance rail freight capacity, however, the proposed promotion plan has not seen its decision to regard energy transformation as an important policy of the ministry. Minister Ho-Chen had a significant gap in concerns about the issue of carbon reduction.

Therefore, this Center hereby suggests that the retroactive development phase of White Paper on Energy Transformation should be fully engaged in the development of greenhouse gas reduction program and incorporate the 2030 carbon reduction commitment into the policy objectives of the transition white paper to avoid the recurrence of the “Energy Development Program” and the lack of integration between “National Program for Response to Climate Change”, resulting in dilemma of substantive policy effectiveness. The Executive Yuan should instruct ministries to include the White Paper on Energy Transformation as one of the major policies, which will actively respond to the proposed proposals made by parties at preparatory stage before they can be managed by the "Mainstream of energy transformation".

Defining transition social legitimacy with external costs

Under the context of Taiwan, energy transformation and energy revolution, or the meaning of energy transformation system lies in the transformation of the word and the transition of justice to a high degree of link. Therefore, the use of the word energy transformation, that is, need to crawl over the system of the huge injustice, face past energy system climate change, nuclear disaster risk, air pollution, huge external costs. In this transformation white paper, in energy governance, although "energy tax" external cost became important internal policy tools, but because tax reform takes a long time, it should also plan other promotional programs, to achieve external costs becomes internal effect. This Center hereby proposes the following four recommendations:

1. Follow green national income account and make regular estimates of energy system external costs: revise current green national income account estimated area and assessment method, incorporate energy system external costs into estimates and, when annual estimates are published, follow the provisions of Article 34 of Budget Act, budget and policy recommendations.

2. Energy-related policies must include in external cost while policy assessment: when National Development Council set regulatory impact assessment manual, should integrate with Environmental Protection Agency in 2012 commissioned "Establishment of environmental policy and development plan of social benefits and cost assessment model" project research results, includes environmental external costs in policy and regulatory impact assessments.

3. Comprehensive review of fossil fuel subsidies and development of reform timetable: based on the results of Asia-Pacific Economic Cooperation (APEC) experts, Taiwan in 2016 submitted the review of five fossil fuel subsidies is inefficient to promote waste subsidies. Therefore, the Executive Yuan should refer to APEC Fossil Fuel Subsidy Review Program, define the scope of review, and instruct the ministries will fully cooperate, to produce reports that can communicate with the public;

4. Promote energy tax with carbon pricing: clearly set energy tax legislation time, and should be based on full response to external costs, tax neutrality, to promote industrial restructuring and other principles, put forward bill planning. And the amount of tax should follow the Organization for Economic Co-operation and Development (OECD) effective carbon rates suggestion, not less than 30 euros per ton.

"Efficiency first" transformation strategy 

Although the transformation of white paper is to achieve  20-30-50 clean energy (power generation) structure in 2025 as core goal, but government has avoided important key issues: in 2025 renewable energy power generation target is 51.5 billion degrees, its proportion to be able to upgrade to 20% of total generating capacity, then Taiwan's electricity consumption in 2025 should maintain the level of 2015, which means to implement the long-term initiative of civic group "Zero growth in electricity demand" to achieve this energy power generation structure. However, the trend of electricity consumption in the past two years, in 2016 electricity consumption increased by 2.16% over 2015, this year (2017) in the first half of the same period last year has grown 1.7%. This trend shows that the new government took office, the lack of energy-saving policies, cannot offset impact due to rebound economics and rising temperatures.

In view of the fact that energy conservation has reached the highest level of consensus among the parties in the energy transformation target and its driving costs are the lowest, [1] this Center proposes following four action proposals for energy conservation issues:

1. Should introduce “National Energy Efficiency Action Plan” to drive "efficiency first" transformation strategy: in view of the development of renewable energy, government put forward short- midterm goal, but in better energy efficiency, no such planning. Current control and execution of energy-saving policy is in chaos, lack of effective cross-department integration, it should follow example of EU energy efficiency directive, requiring countries to study and propose "National Energy Efficiency Action Plan" approach, put forward short-midterm energy efficiency improvement target, policy measures and budget planning for "National Energy Efficiency Action Plan".

2. To industrial restructuring and recycling economy to promote industrial energy efficiency: industrial sector is Taiwan's energy and electricity highest consumption sector, so energy industry structure adjustment is the key policy for all national energy policy. However, current industrial energy policy planning, did not propose to lower energy-consuming industries proportion policy objectives and supporting policies. Current promotion plan proposed of industrial sector is still part of existing measures, ignoring the innovative strategy of United Nations Intergovernmental Committee Climate Change Experts (IPCC) and International Energy Agency (IEA), which relies on recycling economy to improve material efficiency to reduce energy demand in industrial sector.

3. To accelerate the improvement of building energy efficiency, to promote "near zero energy" as the core of building energy policy: according to International thinking tank Climate Action Tracker (2016) analysis, to achieve the objectives of Paris agreement, OECD countries in 2020, the annual energy efficiency of building materials must reach 5%, and new buildings after 2020 are required to achieve near zero energy consumption. While existing residential age in Taiwan is an average of 28.9 years, more than 45% of housing in next 20 years has to face renovation and reconstruction needs, therefore, in better building energy efficiency, should propose accelerating energy-saving repair rate supporting strategies.

4. To exert cities, counties in power accelerating residential and business buildings energy savings: in recent years, small businesses and residential increased growth in electricity demand, but the two are not covered in current central energy management laws. Therefore, in this transformation white paper, if wants to integrate counties and cities capacity to speed up the energy-saving behavior and measures, then needs to focus on county and city governments in the construction laws and regulations, community mobilization function, put forward the best feasible measures, actively counseling its ability to build organization energy.

Electricity planning must avoid "lock-in effect"

The key issue in power planning is whether the “Stabilizing Power Supply Scheme” will be able to stabilize short-term power supply, the demand for air pollution reduction and 2025 electricity target, 2030 commitment to greenhouse gas reduction, during this period new power plants and natural gas removal equipment and other hardware construction, and does not produce "carbon lock-in" effect, as the obstacle of Taiwan's implementation of 2050 long-term reduction targets. Here this center proposes following three action plans:

1. Follow Japan and South Korea and establish "Summer peak supply and demand outlook, review mechanism": in recent two years of summer power supply crisis are in the absence of complete planning and information is not transparent, causing social distress, does not help the process of energy transformation in social learning. It should follow the practice of Japan and South Korea, before entering summer each year, put forward summer peak supply and demand outlook, according to various types of users; prepare appropriate precautionary measures in advance. And after end of summer, review peak supply and demand strategy for the year, to clarify short-term power supply to ensure stability, need to strengthen policy link.

2. Taipower long-term power development program should be included in carbon reduction and air pollution control plan: current Taipower power development program does not fully respond to carbon reduction and air pollution control needs. According to its latest 2017 long-term power development program (Case 10605), in next decade, coal power plant capacity will increase to 2.3 million kilowatts, which against current desire to significantly reduce the proportion of coal to 30% target. It should require follow-up Taipower long-term power development program research and development, at the same time, should put forward the plan of reducing carbon and renewable energy, and put forward the plan of effectively integrating solar energy and wind power generation in peak of summer electricity, in view the trend of increasing the proportion of renewable energy. To ensure that it will contribute to the implementation of “Energy Development Program”, which is enhanced by "Supply side diversified self-contained low-carbon", "System-side integrated intelligence" and "Green economy".

3. The expansion of natural gas supply should be based on "Bridge connection option" moderate planning: according to 2025 coal-fired power generation ratio increases to 50% plan, future Taiwan's natural gas demand will be doubled to nearly 30 million tons. So current China Petroleum Co. and Taipower propose natural gas receiving station construction plan, is expected to Taiwan's natural gas reception in 2030 will reach 31 million tons. However, international studies have pointed out that natural gas as bridge option, power generation accounted for will significantly reduce after 2030. If Taiwan is to meet reduction targets disclosed by the Greenhouse Gas Reduction and Management Law, the proportion of natural gas reaches to 50% in 2030, it must be gradually reduced. So when the construction of natural gas receiving stations, operating rate will be reduced after 2030, and becomes stranded assets. So Energy Bureau should re-estimate 2018 ~ 2050 annual demand for natural gas, gas capacity and gas power generation plant capacity. [2] Taipower and China Petroleum Co.'s expansion of natural gas use plan to make corresponding re-evaluation results for corresponding adjustments.

Master the window of energy transformation opportunities

In addition to above three policy recommendations, the rest of local energy governance, renewable energy development and follow-up to Electrical Law to be amended recommendations, are detailed in annex. This Center stressed that energy transformation is not only the development of green energy technology, the key issues are not only the impact of electricity price is affordable. It requires new governance mechanisms and careful policy support. And this energy transformation white paper is after one and half years of new government, the systematic construction of energy transformation path map. Therefore, this Center calls on citizens who are concerned about energy transformation issues and should continue to focus on white paper development process. Public sector should see this as an opportunity to carry out social dialogue, and actively put forward innovation as a way to accelerate the transformation of energy in Taiwan.