Simulating the effects of offshore wind energy policy on decarbonization and industrial growth in Taiwan: A system dynamics approach

Significant growth of offshore wind sector is creating key projects, opportunities, and challenges that are currently shaping industry trends in Taiwan. Although the current Feed-in-tariff (FIT) subsidy policy in Taiwan is 2–3 times the global average, the CO2 emission in Taiwan is still very high (288 Megatons in 2021) and the renewable energy share in the overall energy mix remained low. This study aims to evaluate the impact of government subsidy policy and the efficiency of power generation by offshore wind power on decarbonization, emission reduction costs, and the development of offshore wind power industry in Taiwan. A behavior model based on the system dynamics approach is proposed to assess the effectiveness of various policy scenarios. The results from simulations show that decarbonization and development of offshore wind power industry from 2022 to 2025 are impacted significantly by the subsidy policy and the system capacity. Under the coordinated development mode of energy and environment, a comprehensive policy scenario can revitalize the development of the offshore wind power industry and better off environmental protections to a large extent. The results indicate that the best strategy will be to combine a capacity factor of 0.53 with a FIT price of 4.6749 TWD/kWh.