Solar Industry Hotting Up

Economic News

22 Jul 2010
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Greenhouse gas emissions and increasing efforts to find alternative energy options are fuelling growth in the Taiwan's solar energy sector, with several foreign investors planning to put money into the country's industry.

On June 17, DuPont Taiwan opened a new $3m photovoltaic research and development centre in the city of Taoyuan. Speaking at the opening of the facility, Tim McCann, vice president and general manager of DuPont Electronic Technologies, said the firm was increasing its profile in Asia to cash-in on the booming regional market.

The day after, local media reported that UPS (uninterrupted power supply) producer Powercom planned to construct a polysilicon plant at Yilan in eastern Taiwan, partly to supply its solar cell subsidiary Top Green Energy. Due to start production in the first quarter of 2009, the plant will have an initial output of 1500 tonnes annually, rising ultimately to a production capacity of 12,000 tonnes.

Yilan is becoming a centre for Taiwan's solar industry, with local firm Unitech Printed Circuit Board also launching operations at its solar cell plant in the region on June 25. Company chairman Pen-Tsao Chang said the factory was the first of three such plants that Unitech intended to open, with the others to come on-line in the near future.

Increasing interest in solar energy has prompted a number of Taiwanese technology firms to diversify their product lines. On June 25, silicon wafer maker Formosa Sumco Technology announced it was extending its business to include solar ingot production with first runs and shipments for Taiwan-based solar cell makers set to begin in August, 2008. The company added that it would dedicate 10% of its existing 20cm wafer furnace capacity for the ingot production.

The recent thaw in relations with mainland China is also serving to boost Taiwan's solar energy industry. On May 23, Taiwan's largest solar-panel-crystal-growing manufacturer, Green Energy Technology Incorporated (GET), said it planned to build a plant in China. According to media reports, the facility will first focus on silicon ingot slicing before moving up to actual production.

With the Chinese government having made solar energy a priority of its eleventh five-year economic development plan released in 2006, GET and other Taiwanese companies could be well-positioned to take advantage of the new alternative-energy-friendly environment in China.

Taiwan's renewable energy sector is also undergoing a change of emphasis and expanding into new markets and products, building on the foundation laid by its successful semiconductor industry. In the past, Taiwan's photovoltaics sector concentrated on upper-stream material such as silicon ingots, wafers and lower-stream solar cells. The focus is now on a wider range of products, including silicon production and silicon-free solar panels.

The country's solar products industry also looks set to get a boost in the domestic market, with the government announcing plans to reduce the country's dependence on fossil fuels and promote alternative energy sources. On June 24, it received a fillip when Japan's government decided to offer subsidies to households that install solar panels. Taiwan's advanced solar energy industry could be a beneficiary. Japan has its own photovoltaic industry, but it has not been as active since a previous set of subsidies and incentives were cut in 2005. During this time, Taiwan's solar industry has grown strongly and is in a position to export units and components to Japan.

The announcement came two weeks after Japanese Prime Minister, Yasuo Fukuda, unveiled a series of measures to reduce the country's greenhouse gas emissions by 60 to 80% by 2050, including plans to have solar energy systems installed on 70% of all newly-built homes.

On June 10, Taiwan's Economy Minister Chii-Ming Yiin said a long-term energy policy to address the country's energy demands through the development of renewable energy would be implemented.

"We have set an ambitious target of increasing renewables to account for 10% of installed capacity, or 3920 MW by 2010. Currently, renewables contribute 2843 MW, so we have a gap of 1077 MW to fill," he was reported as saying.

"By implementing these action plans, we can reduce the impact of high oil prices, diversify energy sources and spur the development of green industries. This is a triple-win solution for environmental protection, energy security and economic growth," he added.

The state also intends to assist the growth of research and development capacities for cleaner energy technologies, the minister concluded.

Today, Taiwan relies on imports to meet 98% of the country's fossil fuels needs. On the back of rising global prices coupled with concerns about the security of energy supplies, investing in renewable energy seems a logical step.

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