Taiwan: A Densely Populated Island with an Interesting Solar Thermal Market

Thermosiphon systems with a horizontal storage tank positioned above the solar collectors are typically used for solar hot water production in Taiwan. Photo: Homemark

Since 2000 the Taiwanese solar thermal market has been on the rise thanks to a governmental subsidy programme. In the year 2007 more than 26,337 solar water heater units were installed, which corresponds to an area of 132,000 m² (see figure below). From 2001 to 2007, the government subsidised 138,824 units. 260,000 systems are currently in operation, assuming a lifetime of 15 years. In 2007 the number of households in Taiwan was 7.5 million: there is thus only 3.5% residential solar water utilisation.

These are some of the results from a study conducted by K.C. Chang, Professor at the National Cheng Kung University Taiwan, on the local market for solar water heaters in Taiwan, which was published at the beginning of the year (see attached document). ”The popularisation of solar water heating in Taiwan was, and still is, strongly coupled with the number of new constructions, ” the author of the study says. Therefore, the global financial crisis has affected the local solar water heater market significantly. ”From January to June this year, the solar water heater market in Taiwan has only seen 11,098 solar water heaters installed. In terms of the area of solar collectors, the installed area is 54,446 m²,” says K. M. Chung, assistant to Professor Chang.

The ups and downs of the Taiwanese solar thermal market are caused by stopping and starting incentive programmes. The latest since 2000 has resulted in steep growth, only disturbed very recently by the financial crisis. Figure: [1]

Due to sunlight conditions, the number of solar water heaters installed in northern Taiwan is lower than in the west and south. From 2001 to 2007 only 588 solar water heaters were installed in the north, which had a collector area of 4,087 m² (see the following figure).  55 % of the systems were sold in the south. It should be noted here that more people live in the south. In the region of Kaohsiung, for instance, more than 150,000 m² of collector area were installed in the seven-year period.

Regional distribution of sales of solar water heaters. The number of households and the number of installed solar water heater systems are given for different regions in Taiwan. Source: [1]

Financial subsidies are a widely recognised economic instrument in the promotion of the installation of solar water heating and therefore the Taiwanese Bureau of Energy of Ministry of Economic Affairs (BEMOEA) has recently launched a new revised incentive programme. Since the beginning of 2009 the support scheme for end users will be 50 % more than the previous incentive, which means that instead of New Taiwan Dollar (NTD) 1,500 per m² of installed collector area, the government will pay NTD 2,250 per m².

This amount corresponds to a share of 18 to 36 % of the investment costs for a residential solar water heater. Not only the Taiwanese government is supporting the growth of the market, but also Kaohsiung city, which has launched an incentive programme for solar water heaters. The additional subsidy of NTD 1,500 will be granted when inhabitants of the city purchase a solar system.

According to the study by professor Chang there were 344 eligible products, 295 qualified installers and dealers and 40 entitled manufacturers active in the market in 2007. At present there are 46 manufacturers in Taiwan – 10 of them hold 90% of the Taiwanese market. The study also shows that the annual sales of vacuum tube collectors is expanding greatly. In 2007 their market share had already reached 10 %. The flat plate collectors are manufactured domestically, whereas evacuated tubes are imported.

[1] Information was provided by the study : Local Solar Water Heater Market in Taiwan: Review and Perspectives  by Professor K.C. Chang from Cheng Kung University in Taiwan.

The text was written by communication specialist Hanna Schober, based in South Africa. Schober@solrico.com