Taiwan nuclear closures could boost LNG demand

Taiwan’s state-owned power company Taipower will proceed with plans to begin shutting its nuclear plants starting in 2018, a source at the company said.

The utility will retire the first unit at the No 1 power plant at Chin Shan in December 2018 and the second unit at the same site a few months after, the source said. The shutdown is expected to increase the country’s demand for other fossil fuels, including LNG, until it further develops renewable energy output.

The schedule for the shut downs – or whether they would even occur – has been a matter of debate.

Taiwan’s new government, elected in January, had campaigned on shutting all three of the country’s nuclear power utilities, which have two power generation units each. Taipower executives had pushed back on the plan, saying that the country could not meet its electricity requirements without the reactors.

A series of accidents that have repeatedly taken the reactors at the No 1 and No 2 facility at Kuosheng offline had caused a public backlash against the idea of maintaining the nuclear plants, however. Plans to delay the shutdowns were recently scrapped, an official with Taiwan’s Ministry of Economic Affairs told local media recently.

Taipower is now reviewing an LNG spot contract template that it plans soon to take to suppliers as it seeks to buy its own gas independent of state-owned monopoly importer CPC, a source in the market said.

Talks continue on whether Taipower could reserve access to CPC’s import terminals, however. The companies are also still planning environmental studies of areas that could host a new LNG import terminal. ben.lefebvre@icis.com