Capacity to be allocated
In Round 3 (2026~2035), the MOEA aims to allocate a total of 15GW of capacity to offshore wind farm (OFW) projects by 2035. The MOEA allocated around 3GW through the first auction ("Round 3-1") in 2022, and in Round 3-2 will allocate a further 3GW for projects with COD dates from 2028 to 2029.
A. Maximum capacity
Compared to the 500MW maximum capacity limit in the Round 3-1 allocation, in Round 3-2 the limit has been increased to 900 MW for the first-ranked developer group, 700 MW for the second-ranked, and 500MW for the remaining selected developer groups.
To provide more flexibility to developers to optimize their participation, in Round 3-2, provided that the OFW projects have the same ultimate shareholder, a developer may group their multiple OFW projects (presumably each of the projects is with planned capacity below the maximum capacity) under one application, instead of submitting separate application for each of the projects.
Multiple applicants/projects under the same developer group will also be collectively subject to the same maximum capacity requirement. The "same developer group" is defined as applicants with the same representative person or a common shareholder owning 20% of the applicant's shares. In these circumstances, the developer is required to undertake that it will not have certain controlling influence over other applicants, or hold directly or indirectly more than 20% shares of other applicants before the Electricity Enterprise License is obtained. A failure to meet this requirement will be considered a breach of the Administrative Contract.
B. Potential bonus capacity for applicants entering multiple CPPAs
For applicants who plan to enter into corporate power purchase agreements (CPPAs) of a contracted capacity of at least 100 MW with at least two domestic enterprise groups, such applicants may be awarded additional capacity up to 100MW.
Allocation procedure
Similarly to Round 3-1, there is a two-step capacity allocation process for Round 3-2 namely: (1) qualification review, and (2) price auction. The qualification review stage examines the application's (a) technical competence and financial soundness, as well as (b) industry relevance requirement (i.e., the localization requirement).
A. Qualification review
In terms of technological competence, the MOEA will review the applicant's construction capability, its engineering design and the operational and maintenance planning. Regarding financial capability of the applicant, the MOEA will review the applicant's financial and risk management proposal as well as the the financial soundness of the applicant's shareholders. An applicant will have to score 70 points or higher in the review of its technology capability and financial capability.
As for localization requirements, the Industrial Development Administration (IDA) (under the MOEA) has labeled a total of 24 industry relevance items. Unlike as under Round 3-1, these are not categorized as "key development items" and "bonus items" with different requirements. Instead in Round 3-2, IDA assigns scores to each of the industry relevance items and the applicant may choose items from the industry relevance items to be implemented. However, the applicant will need to commit to procure local items of a value of 70 points or higher to be able to participate in the price auction.
B. Price auction
For applicants who have met the localization requirement and attained a score of at least 70 points for technical competence and financial soundness review, the next stage is to compete for the grid allocation award based on their bidding price (being the price for their wholesale electricity to Taipower, the state-owned utility).
The bidding price should be between NTD 0 /kWh (i.e., a "zero floor" rate) and NTD 2.49/kWh. In the event two or more applicants bid the same price, the applicant with a higher score on the localization assessment shall prevail.
Timeline and pending associated rules
The deadline for submission of applications for grid allocation is April 2024 (exact deadline TBA) and the selection results will be announced in May 2024.
Building on experience gained in consultation with potential developers from previous rounds of solicitation, the MOEA has settled the key terms of the industrial relevancy programe (which will set the industry relevancy items, the assigned points and the audit criteria, etc) and the template Administrative Contract (which details the successful bidder's obligations). However, these two documents are yet to be finalized and published.