End Fossil Fuel Subsidies: RE100

A representative of the RE100 renewable energy initiative called on the government on Thursday to abolish subsidies for fossil fuels to further stimulate the development of the renewable energy market.

Climate Group Chief Energy Officer Sam Kimmins welcomed Hon Hai Technology Group (Foxconn) to the RE100 family, which has committed to using 100% renewable electricity across its global operations by 2040.

Foxconn announced on Thursday that it has formally become a member of RE100.

RE100 is a global corporate renewable energy initiative that calls on companies to commit to 100 percent renewable energy. It has 34 Taiwan-based company members, including Taiwan Semiconductor Manufacturing Co and Hon Hai.

The association’s 34 members account for more than 10 percent of Taiwan’s electricity needs, Kimmins said.

The country’s total electricity consumption last year was about 277 terawatt-hours, the Energy Agency reported.

Kimmins said about 98 percent of Taiwan’s energy is imported, which not only incurs huge costs but also poses a threat to energy security.

“The biggest advantage of renewable energy is that it is produced here in Taiwan,” he said.

As an export-driven economy, Taiwan is heavily dependent on exports, and its customers such as Google, Amazon and Apple increasingly expect products to be manufactured using 100% renewable or emission-free electricity, the RE100 executive said.

However, while demand is high, there are barriers to mass access for companies in Taiwan. One major obstacle is the relatively high price of renewable energy.

Kimmins said one reason the price remains high may be because the tipping point of decline has not yet been reached.

“The Global Wind Energy Council (GWEC) has developed a model that predicts that once the market reaches about 3 to 4 gigawatts of installed offshore wind capacity, there will not only be a steady decline in prices, but (also) a sudden decline in prices,” he said.

He added that Taiwan’s offshore wind market has not yet reached the appropriate scale, but is on track to reach 3 gigawatts by the end of this year and even 5.6 gigawatts next year.

“We will therefore soon reach the critical point predicted by GWEC,” he added.

Another factor that keeps renewable energy prices relatively high is the fact that fossil fuel subsidies keep the price of electricity from non-renewable sources “artificially low,” the executive said.

Kimmins added that removing fossil fuel subsidies would create a level playing field for renewable energy.