Amendment to Energy Management Act Mandates Energy Storage for Large Power Users, Raising Maximum Fine to NT$500,000

Core Content and Timeline of the Amendment

The Ministry of Economic Affairs plans to finalize a draft amendment to the Energy Management Act by July 20, 2026, mandating that large power users with certain contract capacities install self-generation and energy storage facilities within a specified timeframe. The measure aims to bolster corporate energy resilience in response to surging electricity demand from AI data centers, semiconductor manufacturers, and high-performance computing industries. Following the amendment, the maximum fine for violations will rise from NT$100,000 to NT$500,000 to strengthen regulatory compliance.

Under the existing Regulations Governing the Installation of Renewable Energy Generation Equipment by Electricity Users with Contract Capacities Above a Certain Level, users with contract capacities of 5,000 kilowatts (kW) or more must calculate their mandatory installation capacity based on 10% of their average contract capacity from the previous year. Companies can fulfill this obligation by installing renewable energy generation equipment, purchasing green electricity certificates, or deploying energy storage systems. If opting for storage, the capacity must be calculated by multiplying the mandatory installation capacity by at least two hours of power supply to ensure adequate reserves.

Background and Policy Objectives of the Amendment

The Ministry of Economic Affairs states that the primary goal of the amendment is to reduce peak electricity demand on the grid, enhance overall power supply resilience, and align with the 2050 net-zero emissions policy. In the event of natural disasters, emergencies, or regional power supply disruptions, companies can rely on their own power sources and storage systems to maintain partial operations, mitigating the risk of blackouts. Additionally, the amendment will encourage businesses to increase their use of renewable energy, reducing dependence on the traditional power grid.

With the rapid expansion of AI data centers, semiconductor plants, and high-performance computing facilities, Taiwan’s electricity demand continues to climb. Analysts note that companies will gradually enhance their self-sufficiency in power supply, elevating the importance of self-generation, renewable energy, and energy storage systems. If future subsidiary regulations further increase the required proportion of self-generation and storage facilities, businesses are expected to accelerate the deployment of solar photovoltaic and energy storage systems, driving demand in the commercial and industrial energy storage market.

Industry Impact and Market Observations

Domestic energy service providers and energy storage equipment suppliers have been actively expanding their presence in the market. Companies such as Hongde Energy and Yunbao Energy, along with storage equipment suppliers like Xitel, Taipower Energy, Lai Ying Technology, and Gesco Technology, have been increasing their investments in large-scale and commercial energy storage sectors. As the amendment progresses, demand for energy storage equipment is anticipated to grow, creating opportunities for related equipment procurement and engineering projects.

However, the draft amendment remains under review, and specific details have yet to be disclosed. The market is closely monitoring whether future subsidiary regulations will adjust the contract capacity threshold, raise the required proportion of self-generation and storage facilities, or expand the scope of applicable industries. Given the uncertainty surrounding the timeline and specifics of the subsidiary regulations, businesses remain cautious about whether they need to adjust existing equipment or increase investments. The Ministry of Economic Affairs emphasizes that the amendment aims to ensure power supply stability while promoting energy transition, though the final content will require approval from the Legislative Yuan.

Energy Storage Regulations and Future Outlook

Under current regulations, the capacity of energy storage systems is calculated by multiplying the mandatory installation capacity by at least two hours of power supply, ensuring that storage systems can provide sufficient backup during emergencies. As the proportion of renewable energy increases, the role of energy storage systems becomes increasingly critical, not only in balancing grid load but also in enhancing the stability and flexibility of corporate power usage.

Analysts suggest that if future subsidiary regulations further increase the required installation proportion, businesses will accelerate the deployment of solar photovoltaic and energy storage systems. This will not only help companies reduce electricity costs but also improve overall energy efficiency. However, as the details of the amendment remain unclear, industries must closely monitor subsequent policy developments to adapt to potential regulatory changes.

Amendment to Energy Management Act Mandates Self-Generation and Storage Facilities for Large Power Users, Raising Maximum Fine to NT$500,000

Core Content and Timeline of the Amendment

Background and Policy Objectives of the Amendment

Industry Impact and Market Observations

Energy Storage Regulations and Future Outlook

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