Siemens Gamesa Renewable Energy (SGRE) has landed a preferred supplier agreement to supply turbines for the 300MW Hai Long 2 project off Taiwan, pressing the button on planned by the OEM to build a nacelle assembly facility in the port of Taichung.
The deal, which is subject to the final investment decision of the offshore wind farm’s development partners, Canadian Northland Power and Taiwan’s Yushan Energy, could see construction get underway as early as 2023.
“This is an important milestone for the Hai Long 2 project and for the localisation of the offshore wind industry in Taiwan,” said David Povall, Northland Power’s executive vice president for develpoment. “We look forward to working with [SGRE] as [it] brings [its] international experience to empower the local supply chain.”
Northland Power had won the right to build Hai Long 2 and the nearby Hai Long 3 projects that jointly have 744MW in capacity in Taiwan's second offshore wind allocation round in June 2018. They were part of a 1.66GW second batch of projects to enter construction from 2023 onwards.
Yushan Energy director Hidehiro Nagata added: “We share Taiwan’s vision of becoming the export hub for offshore wind and leader in renewable energy in the region. Hai Long 2 can be the anchor project that enables the expansion of the local supply chain, opening the potential for exports in the future.”
Andreas Nauen, SGRE’s offshore CEO, said the order “represented a stepping-stone for our long-term presence in the region and will enable the expansion of our own local footprint”.
The Taichung facility, which will be used for offshore nacelle assembly, testing, warehousing, office buildings, and outdoor storage, is expect to be operational in 2021.
The deal for the project, being built at a site some 50km off the coast of Changhua County, brings SGRE’s order book to close to 2GW of Taiwan.
In 2016, the OEM supplied and installed the first two turbines in the market as part of the lead-off phase of the Formosa 1 wind farm, which was later expanded and brought online as a 128MW development by developer Orsted.
Taiwan’s Ministry of Economic Affairs (MOEA) last month had increased pressure on offshore wind developers, cautioning foreign developers that they could be replaced by “second-tier candidates” if they fail to fulfil localisation targets set by the ministry.
It seems companies have acknowledged the warning.
Siemens Gamesa recently had confirmed plans to build a facility in the port of Taichung. It will be used for offshore nacelle assembly, testing, warehousing, office buildings, and outdoor storage, the production of which is planned to start in 2021.
The German-Spanish OEM also said it is working closely with international and local suppliers in order to develop a localised competitive supply chain meeting global industry standards.
“With the 300 MW Hai Long 2 offshore wind project, we see a new opportunity to demonstrate our long-lasting commitment to the market, and to contribute to the creation of a competitive local industry in order to open the potential for exports to the region in the long run," said Niels Steenberg, executive general manager of Siemens Gamesa Offshore for Asia-Pacific.
The Taiwanese government has high ambitions for offshore wind in its energy mix, yesterday (12 Oct) doubling its previous stated plans for the next stage of its offshore wind build-out with a goal to add 10GW of extra capacity from 2026 to 2035.
That would bring the country's overall capacity for wind at sea to 15.5GW in 2035.
Last year Taiwan held two rounds of offshore wind allocation to award seven companies a total 5.5GW capacity for its first stage of large-scale development between 2019-2025.