Over 400 Major Electricity Users Affected by Energy Management Act Amendment – Industry Federation Urges Clear Power Contracts Balancing Industrial Development

The Industrial Federation stated today (3rd) that the Legislative Yuan is currently reviewing an amendment to the Energy Management Act. According to the Renewable Energy Development Act and its subordinate regulations, major electricity users consuming over 5MW (megawatts) are required to install renewable energy capacity equivalent to 10% of their contracted capacity. Therefore, the Federation urges that electricity contracts signed by energy users should clearly stipulate provisions that not only reduce excessive reliance on the power grid but also accommodate industrial development.

The Federation pointed out that Article 10 of the current amendment draft includes a newly added Paragraph 4, mandating that energy users with contracted capacity above a certain threshold must install self-owned power generation and energy storage systems exceeding a specified capacity within a defined period. The goal is to enhance users’ energy self-sufficiency and reduce dependence on the national grid.

However, the Federation warned that if this revised clause passes unchanged—requiring all users above 5MW to install self-generation and storage systems—approximately 400 companies in sectors such as semiconductors, optoelectronics, steel, petrochemicals, and AI data centers would be affected. Given the significant implications for industrial development, the Federation has consolidated opinions from various industry associations to provide input during legislative deliberations.

First, according to the Ministry of the Interior’s standards for installing solar photovoltaic systems on buildings, rooftop solar panels are only mandatory for 'new construction, additions, or renovations' exceeding a certain scale. Since existing industrial sites often lack sufficient space for energy storage and generation equipment, and considering the legal principle of non-retroactivity, the Federation recommends that the requirement to install self-owned generation and storage systems should apply only to plant expansions or new investment projects.

Second, current energy storage systems still raise safety concerns, and many insurance companies refuse to cover them, indicating that technical risks and safety standards have not yet been fully recognized. The Federation suggests a gradual, phased approach—deferring mandatory storage installation until technologies mature. It proposes revising the wording from 'self-owned generation equipment AND energy storage equipment' to 'OR,' thereby granting businesses greater flexibility in compliance.

Third, in addition to physical installations, the Federation recommends explicitly including 'alternative compliance methods' such as payment of fees, purchase of renewable energy certificates (RECs), and participation in demand bidding and demand response programs. These non-installation pathways would offer enterprises more diverse and practical solutions.

In summary, the Federation proposes amending Article 10, Paragraph 4 of the Energy Management Act to read: 'New energy users signing electricity contracts with capacity above a certain threshold shall, within a specified period, install self-owned power generation equipment, energy storage systems, or other alternative compliance measures exceeding a certain capacity.' This formulation, the Federation argues, would effectively reduce overreliance on the grid while supporting continued industrial development.

Finally, the Federation emphasized that when the Ministry of Economic Affairs formulates subordinate regulations defining terms such as 'major electricity user,' 'specified period,' and 'alternative compliance measures,' it must engage in thorough consultations with industry stakeholders. This process should address practical operational barriers and minimize adverse impacts on industrial operations and development.