The effect of government policy on wind power development strategy:a comparison of Taiwan and China

• Main Authors: Graham,Joshua, 葛卓強
• Other Authors: 于卓民
• Format: Others
• Language: en_US
• Published: 2007
• Online Access: http://ndltd.ncl.edu.tw/handle/27146965987714931552

碩士 === 國立政治大學 === 國際經營管理碩士班(IMBA) === 95 === Although wind energy is still unable to compete with traditional forms of power production on the free market, it is the world’s fastest-growing energy source with an average annual growth rate of 29 percent. This growth is mainly due to favorable policies set by the government. The reasons for these policies include the reduction of: pollution, fossil fuel dependency, and/or carbon emissions. Countries have utilized a number of wind energy incentive programs which have produced varying results. In the past, researchers have found that the “fixed tariff” incentive policy stimulates growth in the wind energy market, but produces a high price. In contrast, the “tendering tariff” has been found to stimulate much less growth with a low price. The cases of Taiwan and China have been analyzed in this thesis, and it was found that, contrary to expectations, the fixed tariff system in Taiwan has a lower price and has produced less growth than the tendering tariff system in China. The reasons for this purported in this thesis is that the model for understanding the dynamics of the policy was wrong. The price under the fixed tariff system determines the amount of development and the amount of land offered in the auctions determines the amount development in the tendering tariff system. The price in the tendering tariff system depends on the amount of competition in the bidding process. Taiwan has been frugal in their pricing of wind generated electricity and the Chinese government has shown determination to offer enough land for development in federal and local auctions to triple its goals. Other policies have also been analyzed including those favoring local companies. China’s large market has given it a bargaining tool for the use of such policies to stimulate joint ventures and local manufacturing, but Taiwan is too small for companies to take interest in similar policies. In Taiwan, companies have played a key role in establishing infrastructure because there was originally a general lack of policy despite political goals. This gave rise to the concept of the “global wind energy company” presented in this thesis. This type of company analyzes the markets of numerous countries before making the decision to enter. To find truly uncontested markets, a company may have to help create infrastructure in markets where it is lacking. Models of the country selection process are given along with strategy models for companies within the different policy systems.