Energy Emergency Response in Chinese Taipei

1. Energy Emergency Response in Chinese Taipei EWG42 Kaohsiung, Chinese Taipei CHINESE TAIPEI 19-20 October 2011

2. Contents • Overview of Chinese Taipei’s Energy Supply and Policies • Legal Framework and Implementation of Stockpiling and Emergency Response System in Chinese Taipei • Conclusion

3. I. Overview of Chinese Taipei’s Energy Supply and Policies

4. Energy Supply in Chinese Taipei High Dependence on Imported Energy Owing to the shortage of indigenous energy resources, 99.4% of total energy supply is imported. Indigenous Energy Supply (2010) 0.88 Million KLOE Total Primary Energy Supply (2010) 146.0 Million KLOE

5. Energy Supply in Chinese Taipei High Dependence on Fossil Energy (1)Fossil fuels accounted for 90.9% of Chinese Taipei’s total energy supply. (2)Chinese Taipei’s dependence on fossil energy is higher than neighboring countries. (3)Electricity from high carbon, coal-fired power plants accounts for 53.4% of electricity supply. (4)In light of the above facts, Chinese Taipei aims to develop low carbon energy to reduce its dependence on fossil fuel.

6. Chinese Taipei’s oil import 4 2 Kuwait 69 Mbbl 20.2% Iran 27 Mbbl 7.83% 3 7 Iraq 33 Mbbl 9.82% United Arab Emirates 15 Mbbl 4.62% 9 1 6 Indonesia 1.7 Mbbl 0.5% Saudi Arabia 117 Mbbl 34.14% 10 Oman 17 Mbbl 5.04% Nigeria 0.9 Mbbl 0.28% 奈及利亞 Nigeria 95萬桶 0.28% Others 32 Mbbl 9.35% Congo 9 Mbbl 2.72% • 340Mbbl/yr in total in2010 • Heavy dependence on Oil import from ME 5 Angola 19 Mbbl 5.54% 8

7. Chinese Taipei’s gas import Others, 11.9% Qatar, 23.8% Omen, 3.5% Nigeria, 7.6% Malaysia, 25.6% Equatorial Guinea, 2.2% Indonesia 17.9% Australia, 7.5%

8. Chinese Taipei’s Coal import Canada 1.2% • 100% of coal is imported • 63.1Mt/yr in 2010 • Mainly supplied by Australia and Indonesia China 6.2% South Africa 4.1% 秦皇島 1135浬 (4天) Los Angeles 6117浬 Long Beach (20~22天) U.S 0.4% Russia 1.8% (1569浬、 5天） Tanjung Bara (1659浬、 5天） Samarinda Richards Bay (6402浬、20~23天） Abbot Point (3267浬、10~12天） Darlymple Bay (3365浬、10~12天） Indonesia 37.4% Gladstone (3567浬、11~13 天) Newcastle (4223浬、12~15天） Australia 45.4% Port Kembla (4318浬、12~15天）

9. Chinese Taipei’s Energy Policy Policy Objective Stability Cleanness Efficiency Developing clean energy Securing stable energy supply Enhancing energy efficiency • Improve energy efficiency by at least 2% annually • Reduce energy intensity by 20% by 2015 (with 2005 as base year) • Reduce energy intensity by at least 50% by 2025 via technical breakthrough • Reduce CO2 emission to the level of 2005 by 2020, and further reduce CO2 emission to the level of 2000 by 2025 • Increase the share of low carbon energy in power generation to at least 55% by 2025. To establish a secure energy supply system to support the needs of economic development Multi-layered policy measures are required.

10. Policy Measures for Energy Stability • Stable supply of energy resources • To diversify procurements to reduce concentration of energy supply • To increase ownership of resources to enhance energy independency 3. To expand supply sources via international cooperation • Sound energy supply facilities 1. Sufficient production facilities 2. Regular maintenance of energy facilities 3. Strengthening energy transmission and storage facilities 4. Ensure energy transit security • Integrated risk management mechanism 1. Regulatory regime and special task forces 2. Emergency response mechanism • The development of renewable energy and energy technology 1. The development of renewable of high independency 2. The development of low-carbon energy technology Important short-term measures

11. Ⅱ. Legal Framework and Implementation of Stockpiling and Emergency Response System in Chinese Taipei

12. Chinese Taipei’s oil stockpiling Petroleum Management Act • Government and private sector are required to maintain oil stock equal to at least 30 days and 60days of domestic demand respectively. (in line with IEA 90-day obligation) • LPG stock should be maintained to a level of no less than 25 days of domestic demand. By the consumption level of 44 Mbbl per day, Chinese Taipei has kept 128 days of oil stocks in total as of Feb 2011. (government:38 days; private sector:90days)

13. Oil emergency response Regulation on Oil Disposal during Emergency In the face of oil disruption or dramatic oil price fluctuation which may pose threats to the stability of oil supply and national security, the Ministry of Economic Affairs are empowered to‧implement restrictions on oil import, export and holdings‧implement restrictions on oil distribution and selling‧set up the maximum of oil prices‧adjust the quantity, appropriate and make specific use of oil stocks

14. Chinese Taipei’s gas stockpiling Natural Gas Enterprise Law • Natural gas enterprises are required to maintain certain stock capacity: —natural gas production enterprises: half day —natural gas import enterprises: 15 days —natural gas enterprises that runs both production and import: 15days Taichung LNG station YongAn LNG station Total gas stocks are equivalent to 15.7 days of domestic demands

15. Gas emergency response Regulation on LNG supply and price control • In the face of gas disruption or dramatic gas price fluctuation which may pose threats to the stability of gas supply and national security, the Ministry of Economic Affairs are empowered to control natural gas supply and prices.‧reduce gas supply to users of different sectors by order of priority: — power utilities (reduction by 10%)— cogeneration users (reduction by 5%)— industrial users (reduction by 5%)— transportation users (reduction by 10%)— public LNG enterprises (reduction by 10%) To minimize the impact ongeneral users

16. Gas emergency response Regulation on LNG supply and price control (cont.) In case of:1. A monthly average price increase of imported natural gas exceeding more than 50%2. A cumulative average price increase over three consecutive months of imported natural gas exceeding more than 50%The Ministry of Economic Affairsmay command LNG import enterprises to temporarily suspend price adjustment or to partially adjust natural gas prices.

17. Chinese Taipei’s coal stockpiling Energy Management Act Coal-fired power plants are required to maintain coal stocks of no less than 30 days by the average coal demand of the previous year. • Currently Chinese Taipei’s coal stocks are equal to 43 days of domestic demand.

18. Measures for coal and electricity emergency response Restriction on the power use during power failure • In the face of insufficient power supply, power utilities may initiate power rationing upon approval of the Ministry of Economic Affairs. • Power rationing is mainly applied to industrial users. Users from national defense sector, transportation sector or other important sectors may not be subject to the restriction above.

19. Ⅲ. Conclusion

20. Follow the IEA 90-day obligation and surpass the target practically to ensure sufficient supply during emergency • Legal framework and obligation are needed and proved to be helpful since Chinese Taipei is heavily dependant on imported energy • Should develop diversified mixture of energy sources and increase the uptake of indigenous renewable energy to ensure energy security • Working on establishing an indexed warning system of energy security risk for the sake of more effective, efficient and dynamic responses to energy emergency and energy security • Willing to cooperate on energy emergency response with international mechanisms

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