Orsted’s Board of Directors has taken a final investment decision (FID) on the Changhua 1 and 2a offshore wind farm in Taiwan, the Danish company announced on Tuesday.
Changhua 1 and 2a will be located 35-50 kilometers off the coast of Changhua County and will have a capacity of approximately 900 megawatts (MW), enough to supply around 1 million Taiwanese households with green power. The farm will be constructed in 2021 and 2022.
According to Orsted's statement, prior to the FID, Taiwan's Ministry of Economic Affairs approved the company's local supply chain plan, and subsequently Orsted signed a power purchase agreement (PPA) with Taipower at the feed-in-tariff level announced on Jan. 30. Taiwan had awarded Orsted the right to connect Changhua 1 and 2a to Taiwan’s power grid back in April 2018.
Martin Neubert, executive vice president and CEO of Offshore at Orsted, said that over the last couple of months, they had been working intensively to obtain an establishment permit, renegotiate contracts, get their supply chain plan approved and sign the PPA.
"Thanks to a close and strong collaboration with our supply chain partners, Taipower and decision-makers in Taiwan, we have achieved all these milestones and can now take the final investment decision on this landmark project, which will be Taiwan’s largest offshore wind farm and demonstrate offshore wind’s potential to decarbonize energy systems in Taiwan and the Asia-Pacific region," he added.
Matthias Bausenwein, president of Orsted Asia-Pacific, explained that the Changhua 1 and 2a offshore wind farm was the first facility on which a final investment decision was taken under the localization rules.
"Orsted will invest significantly in Taiwan’s transition to renewable energy with substantial impact on local job creation and industrial development. We are proud that we have secured a very high level of local content on the project, and we will start the initial onshore works already next month," he added.
According to the press release, in June 2018, Orsted was awarded the right to build another 920 MW offshore wind in Taiwan through its Changhua 2b and 4 sites. The construction of Changhua 2b and 4 is planned for 2025, subject to Orsted taking a final investment decision on the projects in 2023.
The statement added that Orsted's Greater Changhua offshore wind sites have a total potential capacity of 2.4 gigawatts (GW). "With a total of approx. 1.8 GW earmarked for buildout in 2021 and 2025, the remaining approx. 0.6 GW can participate in future auction rounds," it said.
Orsted is also the co-owner of Taiwan’s first commercial-scale offshore wind project, the 128 MW Formosa 1 offshore wind farm, which is currently under construction and is expected to be operational by the end of 2019.
By Hale Turkes