Cutting nuclear not feasible
In response to Wednesday’s editorial concerning the future of industrial energy production in Taiwan, I want to offer some observations about externalities.
The most significant obstacle to DPP presidential hopeful Tsai Ing-wen’s (蔡英文) goal of replacing the nuclear power industry in Taiwan by 2025, assuming she is elected president next year, is the cost of land. Noting that the combined output of Taiwan’s three operating nuclear power stations accounted for 41.5 terawatt hours in 2009, or 18.1 percent of Taiwan’s total energy production, allow me to illustrate the problem with reference to everybody’s favorite renewables: solar and wind.
Extrapolating from the numbers for the pilot solar power plant built in Lujhu (路竹), Greater Kaohsiung, a few years ago, which had a 1MW capacity, cost NT$246 million (US$8.3 million) and covered two hectares, it is possible to clearly envisage the absurdity of constructing solar plants to this and larger scales in Taiwan. In order to reach the target of 41.5TW hours over a year, and making the very generous and unrealistic assumption that such solar plants would generate their maximum power output 50 percent of the time, they would collectively need a capacity of 10,400MW, would be built at a capital cost of NT$250 billion and would require an enormous 180km2 of land — an area substantially larger than Kaohsiung.
Onshore wind farms are far cheaper and more powerful than offshore farms owing to the increased size and power of the turbines, with one turbine alone capable of producing 7MW at an approximate capital cost of NT$23 million. To be capable of producing 41.5TW hours over a year, and assuming an average efficiency of 30 percent, such a wind farm would have to comprise 2,014 such turbines at a capital cost of NT$46 billion — which, compared with the NT$250 billion for the solar plant, would be very cheap. An onshore wind farm on this scale would, however, require an area of 323km2 — which is significantly larger than Taipei.
What each of these two back-of-an-envelope calculations show is the importance of land prices. Flat, open land is at a premium in Taiwan partly because of the nation’s geography, but also partly because of an enormous externality: the state’s protection of rice farmers from both foreign competition and the environmental externalities the farmers themselves create by over-consuming ground water. Unless a Tsai administration would be prepared to extricate the state from agriculture, thus allowing true market competition to induce some farmers to voluntarily sell off their land, then the artificially high price of farmland would leave a Tsai administration unable to afford its commitment to replacing nuclear power and increasing renewable energy.
That is assuming a Tsai administration, along with its environmental supporters, would not favor removing such an “inconvenience” by means of land theft rebranded as “expropriation” — such as was visited upon farmer Chu Feng-min (朱馮敏), who subsequently committed suicide in Miaoli County last year.
That must never be allowed to happen again.