Renewable Energy Development Act (This English translation is for reference only.) Article 1 The Act is enacted to promote the utilization of renewable energy, increase energy diversification, improve environment quality, energize the industry and drive the national sustainable development. Article 2 The competent authority refers to Ministry of Economic Affairs for the central government; the municipal government for the municipality directly under the jurisdiction of the central government; the county (municipal) government for county (municipality). Article 3 Terms of this Ordinance are defined as follows: 1. Renewable energy: refers to solar energy, biomass energy, geothermal energy, ocean energy, wind power, non-pumped-storage hydropower, the energy generated from either direct or processed domestic general waste and general industrial waste, or other sustainable energy affirmed by the central competent authority. 2. Biomass energy: refers to the energy generated from either direct or processed agriculture or forestry plants, methane or domestic organic wastes. 3. Geothermal energy: refers to the energy originated from underground and contained in soil, rock, steam or hot spring. 4. Offshore wind power generation system: refers to the wind power generation system installed in waters outside the low-water line and within the scope of the territorial sea. 5. River-type hydropower: refers to the hydro-electric power system that utilizes the natural water flow and height difference of ditch channels. 6. Hydrogen energy: refers to the energy from hydrogen that is produced by the decomposition of water using renewable energy sources, or by bio-decomposition or fermentation through bacteria, algae or other organisms. 第 1 頁, 共 10 頁 1
7. Fuel cell: refers to the device that uses electrochemical reaction between hydrogen and oxygen to convert chemical energy into electrical energy. 8. Renewable energy thermal application: refer to the use of renewable energy in non-power generation fashion but in thermal energy or fuel application fashion. 9. Renewable energy power generation equipment: refers to the power generation equipment that is not non-river-type hydropower type or direct waste combustion type and affirmed by the central competent authority and complaint with Article 4 paragraph 3. 10. Avoided cost: refers to the annual average cost for the power utility to self-generate or purchase from other sources of non-renewable electricity. The low-water line for offshore wind power generation system is publicly announced by the central competent authority. Article 4 In the promotion of renewable energy power generation equipment, the central competent authority shall consider the climate and environment for our nation, characteristics of electricity demand, the economic benefits, and technological development for each type of renewable energy and other factors. The Articles regarding grid integration and purchase of electricity shall apply to the renewable energy power generation equipment affirmed by the central competent authority. The energy category, equipment capacity, auditing, validation procedure and other directions regarding the renewable energy power generation equipment in the previous article shall be determined by the central competent authority. Article 5 The installation and utilization of self-usage renewable energy power system under 500 kw in capacity shall not be limited by the provisions in Article 97, Article 98, Article 100, Article 101 and Article 103 of the Electricity Act. Except for the provisions in Article 8, Article 9 and Article 14, the application, engineering, operation, supervision, registration and administration for the renewable energy power generation equipment shall comply with the Electricity Act. The engineering in the preceding paragraph includes design, manufacturing audit, installation, operation, repair, inspection and maintenance. 第 2 頁, 共 10 頁 2
Article 6 The central competent authority may consider domestic renewable energy development potential and its influence to domestic economy and power supply stability, to set promotion targets and the percentage of each category for every two years within 20 years from the enactment of this Act. The reward capacity for the renewable energy power generation equipment is the total capacity between 6,500,000 kw and 10,000,000 kw; when the total reward capacity reaches 5,000,000 kw, the central competent authority shall review the renewable energy category provisions in Article 4 paragraph 3 by considering the economic benefits, technological development and related factors for each renewable energy category. The promotion targets and timelines for renewable energy thermal application are determined by the central competent authority with respects to the economic benefits, technological development and related factors. Article 7 The power utility and the institution who installs self-usage power generation equipment that reaches a certain level of capacity shall pay a certain amount into a Fund every year according to the non-renewable energy portion in total power generation and the Fund is used for renewable energy development; when it is necessary the Fund is budgeted and allocated by the government. The certain level of capacity in the preceding paragraph is set by the central competent authority; the certain amount paid to the Fund is determined by the central competent authority according to the energy category. The provisions for the Fund in paragraph 1 regarding fund collection, procedure, period and other related matters are set by the central competent authority. The use of the Fund in the paragraph 1 is as follows: 1. Subsidies to electricity generation from renewable energy. 2. Subsidies to renewable energy equipment. 3. Subsidies to demonstration of renewable energy and promotion of the use. 4. Other uses of renewable energy approved by the central competent authority. The power utility and the institution that installs self-usage power generation equipment that reaches a certain level of capacity having 第 3 頁, 共 10 頁 3
paid the fee to the Fund according to paragraph 1 or purchased electricity with paid fee to the Fund, may add the paid amount to the selling price of the electricity after the approval from the central competent authority. Article 8 Power utility operating power grids at where the renewable energy power generation equipment is located, shall evaluate the stability for the power grid and provide grid integration, purchase of electricity and back electricity during the maintenance period to the renewable energy power generation equipment; without justification and permission by the central competent authority, the power utility may not refuse; if necessary, the central competent authority may assign another power utility to fulfill the responsibilities. The technical appropriateness of grid integration in the preceding paragraph is limited to those with reasonable cost and economic justification; beyond the existing power lines, the cost of installing enhanced power grids is shared by the power utility and the operator of the renewable energy power generation equipment. The power utility that according to this Act purchases electricity from renewable energy shall sign contract with the operator of renewable energy power generation equipment and inform the central competent authority. The technical specifications of the grid integration and the pricing for required power during the maintenance period in paragraph 1 shall be developed by the power utility and approved by the central competent authority. The power lines connecting the renewable energy power generation equipment and the power grids shall be constructed, installed and maintained by the operator of renewable energy power generation equipment; if necessary, the power utility with grid integration to the power generation equipment shall provide required assistance; the incurred cost shall be paid by the operator of renewable energy power generation equipment. Article 9 The central competent authority shall invite relevant Ministries, scholars and experts, and private groups to form Commission to decide the feed-in tariffs and the calculation formula for the electricity generated by the renewable energy power generation equipment; if necessary, shall follow Administrative Procedure Act to hold hearings before make public announcement; and shall review and revise the tariffs and the calculation formula every year with respects to the power generation technology advancement, cost variation, goal 第 4 頁, 共 10 頁 4
achievement status and relevant factors for each category of renewable energy. The above tariffs calculating formula shall be determined by the central competent authority concerning the average installation cost, operating life, operation and maintenance cost, annual electricity generation and relevant factors of renewable energy power generation equipment separately for each category of the renewable energy. To encourage and promote pollution-free green energy and strengthen the willingness of investment in renewable energy, the feed-in tariffs shall not be lower than the average cost for fossil fuel power generation of domestic power utilities. From the enactment date of this Act, the renewable energy power generation equipment operator signing contract with power utility according to paragraph 3 in the preceding article, the electricity generated shall be purchased according to the feed-in tariffs publicized by the central competent authority. The electricity from renewable energy generated by the equipment of those who have signed electricity sales contract with the power company before the Act takes effect shall be purchased at the original tariff. Electricity from the renewable energy power generation equipment under any of the following conditions shall be purchased at tariff at the less of the avoided cost or the publicized rate in paragraph 1: 1. Before the Act takes effect, the equipment has been already operated and there has been no sales contract with the power company. 2. The operation has been more than 20 years. 3. It is installed after the national total power capacity from renewable energy reaches the upper limit of the awarding capacity set by Article 6 paragraph 2. Article 10 before the national total power capacity from renewable energy reaches the upper limit of the awarding capacity set by Article 6 paragraph 2 is reached, the expense of power utility for purchasing the electricity generated by the renewable energy power generation equipment according to the previous Article, or self-generated by the power utility may be entitled to subsidies, except those with responsibilities by other laws to install renewable energy power generation equipment; the subsidy will be provided by the Fund established by this Act after the central competent authority approves the subsidy application. 第 5 頁, 共 10 頁 5
The subsidy mentioned in the preceding paragraph is calculated according to the increase of the feed-in tariffs set by paragraph 4 and paragraph 5 of the preceding Article over the avoided cost. The paragraph 6 of the previous article and the avoided cost are calculated by the power company and validated after approval by the central competent authority. The provisions for the subsidy application and approval for the renewable energy in paragraph 1 shall be established by the central competent authority. Article 11 With the purpose of demonstration, rewards shall be given for a specific period of time by the central competent authority to the renewable energy power generation equipment with development potential in the early stage of technological development. The reward provisions shall be established by the central competent authority. Article 12 New and renovation projects for public construction or public buildings that have construction circumstance meeting the requirements of installing renewable energy facilities have the priority of installing renewable energy power generation equipment. Article 13 The central competent authority may consider the reasonable cost and profit for the following renewable energy thermal applications and establish rewarding subsidy provisions according to the benefits of energy contribution: 1. Solar energy thermal application. 2. Biomass fuel. 3. Other renewable energy thermal application technology with development potential. The budgets for subsidies for the part of the thermal applications mentioned in the preceding paragraph to replace fossil energy shall be provided by the Petroleum Fund according to the Petroleum Administration Law. The financial incentives to produce biomass fuel from energy crops grown on fallow land, or other idle land of agriculture, forestry, animal husbandry, shall be provided by Agricultural Development Fund; the provisions regarding reward eligibility, requirements, subsidy 第 6 頁, 共 10 頁 6
and schedules shall be jointly established by the central competent authority and Council of Agriculture, Executive Yuan. Article 14 For the renewable energy power generation equipment that reaches the capacity standard set by the central competent authority, the acquisition right, use procedure and disposal of for the land required by the renewable energy power generation equipment and power lines shall be applicable to Article 50 to Article 56 of the Electricity Act. Article 15 The use or acquisition of the land for renewable energy power generation equipment and facilities for power transmission and transformation shall be applicable to the public utility section or public facility section of Urban Planning Act and Regional Planning Act. Leasing state-owned or publicly owned forest land for the renewable energy power generation equipment and power transmission and transformation equipment shall be applicable to Forestry Act Article 8 concerning public utilities or public facilities. The land use for renewable energy power generation equipment and power transmission and power transformation in fishing port area shall be applicable to Fishing Port Act Article 14 concerning general facilities of fishing port. The location of power plant for combustion-based biomass energy shall be restricted to industrial area, while this regulation does not apply to power generation from methane. Article 16 The machinery, equipment, special transportation equipment, training equipment and their parts and modules imported by corporations and juridical persons to build or operate renewable energy power generation equipment shall be exempt from customs duty after their use is proved by the central competent authority and no domestic manufacturer and supplier has been found. The customs duty for the equipment imported by corporations and juridical persons mentioned in the preceding paragraph that has found domestic manufacturer or supplier and their use has been proved by the central competent authority shall be paid in installment after one year of completion of the project with appropriate securities. The renewable energy power generation equipment imported by natural persons that their use has been proved by the central 第 7 頁, 共 10 頁 7
competent authority and no domestic manufacturer and supplier has been found shall be exempt from customs duty. Transfer or change of use of the equipment in the preceding three paragraphs that duty is exempt or may be paid in installment shall comply with the provisions in Customs Act Article 55. The provisions for the preceding paragraph 1 to paragraph 3 concerning duty exemptions or installment payment shall be established by the Ministry of Finance after consultation with relevant agencies. The provisions for the application procedure of proof document, the scope of the renewable energy power generation equipment self-used by natural persons and directions shall be established by the central competent authority after consultation with relevant agencies. Article 17 Installing renewable energy power generation, utilization system and related facilities without exceed the standards for capacity, height or area according to different facility characteristics shall be exempt from applying miscellaneous license. The standards for facility capacity, height or area mentioned in the preceding paragraph to be exempt from applying miscellaneous license shall be jointly determined by the central competent authority and central building administrative authority. Article 18 When it is necessary, the central competent authority may require the operator of renewable energy power generation equipment to provide renewable energy operation data and conduct audit with own auditors or commissioned professional institution; the operator of renewable energy power generation equipment shall not evade, obstruct or refuse to be audited. The operator of self-usage power generation equipment that reaches a certain level of capacity according to Article 7 paragraph 1 shall document the operation in monthly report and prepare and file the annual report within three months after the year end to the central competent authority; the central competent authority may require supplementary data or conduct audit; the operator of self-owned power generation equipment shall not evade, obstruct or refuse to file the report and be audited. The report format in the preceding paragraph shall be established by the central competent authority. 第 8 頁, 共 10 頁 8
Article 19 When any dispute concerning this Act arises between the operator of renewable energy power generation equipment and the power company, prior to proceeding to litigation, the party shall request for mediation through the central competent authority and the other party shall not refuse. The central competent authority shall invite scholars and experts to conduct the mediation. The sustained mediation and legal settlement have the same legal effect; if the mediation does not succeed, arbitration or litigation procedures may be followed. The provisions concerning the application, procedure and related matters for the mediation in paragraph 1 and paragraph 2 shall be determined by the central competent authority. Article 20 Under any of the following conditions, the central competent authority shall notify with deadline of improvement; when the improvement has not been made past the deadline, the fine between NT $300,000 and NT $1,500,000 will be imposed with new ordered deadline for improvement; if no improvement has been made at the deadline, the fine will be imposed again and continue to be imposed for no improvement: 1. Violate the provision in Article 7 paragraph 1 that do not pay to the Fund. 2. Violate the provision in Article 8 paragraph 1 that do not have grid integration, purchase of electricity or provide the required power during maintenance period. Article 21 For violating Article 18 paragraph 1 or paragraph 2 by evading, obstructing or refusing to be audited or inspected, the fine between NT $300,000 and NT $1,500,000 will be imposed. Article 22 For violating Article 18 paragraph 1 or paragraph 2 by failing to provide or file, or to timely provide or file, or to provide or file the true data, or to provide supplementary data, the central competent authority shall notify with improvement deadline; when the improvement has not been made past the deadline, the fine between NT $200,000 and NT $1,000,000 will be imposed with new ordered 第 9 頁, 共 10 頁 9
deadline for improvement; if no improvement has been made at the deadline, the fine will be imposed again and continue to be imposed for no improvement. Article 23 This Act takes effect at the time it is promulgated. Attached resolution to Article 9: regarding feed-in tariffs and calculation formula, hearing shall be held according to the Administrative Procedure Act in the first year; and afterward at least once every three years. 第 10 頁, 共 10 頁 10