Taiwan’s annual imports of liquefied natural gas are set to rise as more gas-fired power plants come online amid the planned phase-out of nuclear power by 2025, an official at state energy firm CPC Corp said.

This year Taiwan’s LNG imports could rise to about 20 million tons from 19 million tons in 2023, said vice president Jane Liao.

The country uses 80% of its LNG imports for power generation, with state-owned utility Taiwan Power Company, or Taipower, as its biggest customer.

“This however is subject to Taipower’s consumption,” Liao said. “If their (generated) renewable power is more than expected, then LNG consumption will be a bit lower.”

Taiwan relies heavily on imports, mostly of coal and natural gas, to meet its energy needs, though it has embarked on a big push for more renewable energy to achieve its carbon neutral target.

It is the fifth largest LNG importer in Asia. As Taiwan’s sole LNG importer, CPC has long-term supplies from Australia, Qatar and Papua New Guinea.

To make up for its nuclear power phase-out, Taiwan is building gas-fired power plants and raising renewable energy generation.

“There are several gas-fired power plants still under construction, and supposed to be completed by next year to back up nuclear. That is the new demand coming in,” said Liao.

Of Taiwan’s LNG imports last year, 25% came from short-term supply or spot cargoes and the rest from mid to long-term supplies, she added.

The volume of spot or short-term supply could increase as CPC holds off signing more long-term supply deals given uncertainty in Taiwan’s nuclear power phase-out timeline and when the gas-fired power plants will be completed.

Taiwan needs room to react in case the plants are not completed in time, Liao said. Once they are finished, “things will be more firm, then we will consider purchasing on a long-term basis”, she said.

CPC has also been importing two to three cargoes of carbon-neutral LNG each year, as customers including semiconductor manufacturers have been requesting it.

The state energy firm is constructing its third LNG import terminal off the coast of Taoyuan. Liao said the hub will undergo a test run at the end of the first quarter next year.
Source: Reuters (Reporting by Emily Chow in Singapore; Writing by Nidhi Verma; Editing by Jan Harvey)