Editors／Roy Yi Ling Ngerng Assistant Researcher, RSPRC

Pei-Yu Chou, Assistant Researcher, RSPRC

The Risk Society and Policy Research Center (RSPRC) conducted an interview with CWind Taiwan's Deputy General Manager Tom Manning this week to learn more about CWind's experience in developing renewable energy in Taiwan, as well as the opportunities and challenges in Taiwan's renewable energy landscape.

CWind Taiwan is a joint venture between CWind and the International Ocean Vessel Technical Consultant (IOVTEC), and provides crew transfer vessels, offshore technicians, construction and O&M services, and training to the Taiwanese offshore wind farm industry.

The interview has been edited for brevity.

RSPRC: Can you share with us the services CWind provides in Taiwan?

Manning: CWind Taiwan is a joint venture between the United Kingdom (UK) and Taiwan. CWind has a large presence in Taiwan, the company owns five vessels and employs 30 people. 

We provide pre-project services such as site investigation to help developers understand the sea bank before constructing a wind turbine, such as by looking at the symmetry and the depth of the water, and whether there are unexploded ordinances or destruction that might affect future installations. Geo-technical surveys are conducted to provide data about the nature of the sea bank. Crew Transfer Vessel (CTV) operations are also a big part of CWind's business - they are basically taxi operations on water to take the crew back and from the wind farms. 

After the wind farms are developed, inspection and maintenance services are also provided, such as to check whether equipment is working properly or subject to corrosion, to which protection work will be needed. 

Other side services our company provides include technicians to perform tasks on the wind farms, as well as installation contractors who help lay cables to the turbine. 

RSPRC: What do you think of the localization efforts of the offshore wind industry in Taiwan?

Manning: Generally, we see it in a positive light at CWind Taiwan. Compared with other companies, our strategy is focused on having a relatively large footprint for localization. We have also set up a training school at our premises and invited students to our office. 

The way we see it, compliance with Taiwan's localization requirement is not just an obligation that our company has to follow, but localizing as much as we can in Taiwan is also a useful strategy - it would enable CWind to become more competitive and efficient in Taiwan, and provides more opportunities for us to compete in other Asian countries.

RSPRC: What are your localization strategies in order to promote greater benefits for Taiwan?

Manning: CWind is not a component manufacturer, and as such we do not design software or equipment. What we do is to utilize these software and equipment to provide services. As such, while CWind does not provide technology transfer, we engage in the process of knowledge transfer. For example, our people have provided their experiences, knowledge and skills for the wind farm demonstration sites in Taiwan, as well as training for the vessel management system.

The goals of the government's localization strategy is actually quite aligned with many of the joint ventures that have been established in Taiwan. There are of course challenges working with other wind developers, turbine manufacturers and the Tier 1 contractors under the government's offshore wind project, however the main issue we face is the rigidity of the government's policy. 

The government has been supporting companies that are not or will not become internationally competitive, and while the Bureau of Energy (BOE) has been really excited about building the wind farms, there is zero focus on maintaining the 20- to 25-year asset life spans of the wind farms. The employment of people, innovation and supply chain cost reduction comes in having nimble organizations and operations that can learn to do things more efficiently and brings down the cost of energy, however there is no incentive for developers to do so, and this is therefore a missed opportunity to develop an internationally competitive supply chain on the O&M (operations and maintenance) side. 

RSPRC: What do you think Taiwan should focus on in the localization of the offshore wind industry?

Manning: A lot of localization companies are focused on developing turbine foundations, and supporting the Taiwanese tradition of manufacturing, and the Taiwan government hopes to use its first-mover advantage to create companies that can export their solutions. However, a lot of what these Taiwanese companies are focused on do not have an export market. For example, countries like South Korea, Japan, Vietnam, and most other Asian countries are better at fabricating things than Taiwan, certainly in terms of the steel structure. Therefore, the conditions created in Taiwan are artificial and do not allow a competitive nature to enter the market. If you say you can only use the Central Selection Board of Constable (CSBC) for the localization of Taiwan's offshore wind industry for the next 10 years, then there is no incentive for other companies to be as competitive, as is the case in South Korea.

Other than fabricating things, Taiwan actually has a highly-skilled educated workforce in electrical engineering and has a definite advantage in electronic component manufacturing. Electronic data is being used on the wind farms to look at how productive the turbine is, the conditions for power optimization, and how power can be distributed in such a way that does not overload the Taipower grid - these are the competencies that Taiwan has. Five years ago, the inspection of turbines would have taken a team of five people walking up and down doing the checking, but five years down the road, inspections will be done by drones and underwater robots, and driven by artificial intelligence (AI) pilots - this is already happening in Taiwan and these electrical engineering competencies are what Taiwan should invest in over a 20-year period. 

Instead, Taiwan's government is short-sighted and still investing in steel construction. 

RSPRC: In other words, Taiwan should focus more on developing its software such as digitalization, engineering and AI, more so than on the hardware aspects, such as on turbine and blade construction?

Manning: Yes, another aspect is that Taiwan can take the lead in is the digitalisation of wind farms.

Taiwan's government is concerned about being re-elected, but you get re-elected by people voting the government in, and people vote for the government when it creates a positive economy and jobs. If you look at the numbers over the last two years, the jobs created are not in the steel industry but in digitalization, where jobs are being created by technology companies - these are the companies that will drive employment in the next 20 years. 

Taiwan has to therefore find the most efficient way for the localization of the wind industry, and it needs to use digitalization to do so.

RSPRC: How do you think of the current arrangement between foreign offshore wind companies and the Taiwan Power Company (Taipower)?

Manning: One reason for the immense support for the UK's renewable energy industry is due to the flexibility in the transmission and distribution of power in the UK. 

However, Taipower is somewhat old-fashioned, not just in terms of the company and its system, but its infrastructure.

In terms of the power purchase agreement (PPA) with Taipower, the interruption to our services is also frustrating. Compared with the modern PPAs that are signed in Europe, there would be pressure on Taipower to modernize its approach. 

RSPRC: Do you think that Taiwan's government needs to take a greater leading role in developing the offshore wind industry? 

Manning: It is actually pretty common for the industry to move faster than the government. The government usually runs way behind the industry. You need the government to develop the framework, design the policy and enact legislation, but all these require the industry to first identify the needs.

Using Japan and South Korea as illustration, they have decent resources and a stronger supply chain to support their offshore wind industries, but their governments do not have bold policies.

RSPRC: Can you share with us the ecological concerns faced by residents in the vicinity of offshore wind turbines being constructed? 

Manning: There are usually three objections - in terms of how birds might be killed, concerns over whether the views will be horrible and noise pollution. It is also seen as still cheaper to burn coal rather than harness wind power. As such, we focus a lot of our efforts on providing empirical data to convince people on the benefits of the wind farms, such as how wind power is cleaner than burning fossil fuels over the longer term. 

From our experiences in other countries, there are also benefits to the local communities, in terms of more job opportunities. The construction of wind farms can also help regenerate the community in deprived towns and generate profits. 

In Taichung, we have set up a training school to give schools a taste of what it is like in the offshore renewable energy industry. We also engage with the local fishermen's association to utilize their knowledge and develop cooperation between the industry and the local communities.