A Chinese invasion of Taiwan would be, even for a proven risk-taker like Xi Jinping, a huge gamble. Its outcome would likely be one of two extremes: a short, sharp victory achieving the Chinese Communist Party’s century-old goal of unifying Taiwan and its 23 million people with the mainland, or a humiliating defeat that would threaten its grip on power.

But ever since then House Speaker Nancy Pelosi visited Taipei in the summer of 2022, infuriating Beijing, Chinese military exercises around Taiwan increasingly resemble a different kind of threat: a blockade. Like John F. Kennedy’s existential gamble during the 1962 Cuban Missile Crisis with the Soviet Union, it offers a middle strategy that could dissuade a risk-averse adversary — in Xi’s case the U.S., flanked by Japan — from intervening militarily on Taiwan’s behalf, or at least not until it was too late.

In a blockade, Taiwan’s Achilles heel would be energy. Last year Taiwan imported 96 percent of its fuel requirement: mostly oil, natural gas and coal. Natural gas generated 42 percent of Taiwan’s power, while nearly 40 percent was generated by coal.

“If we’re losing power … nothing open, no smartphone[s], no hospital capability, then you’re asking, “how long you can defend yourself?” says Richard Chen, a former head of Taiwan’s navy. Chen, who is now a legislator for the opposition Kuomintang (KMT) party, helped organize war games that included blockade scenarios for the non-partisan Taiwan Center for Security Studies in 2024 and again earlier this year. 

Right now we have basically a single point of failure vulnerability. [China could] black out the entire island.

Jason Hsu, a former KMT legislator and senior fellow at the Hudson Institute in Washington

In more “kinetic” scenarios, in which a blockade escalates to attacks on critical infrastructure that transfers energy across the island, Taiwan’s vulnerabilities increase exponentially. “Here we are more concerned,” Chen said.

Pointing to a diagram of power infrastructure along the western coast of Taiwan, he adds: “It’s a super high voltage, transformer switching site [for the] power grid — very vulnerable, no protection … You don’t need to attack a power [station]. Disable this power grid and you can lose power for at least 72 hours.”

“Right now we have basically a single point of failure vulnerability,” Jason Hsu, a former KMT legislator and senior fellow at the Hudson Institute in Washington, says of Taiwan’s energy sector. Like Chen, Hsu has participated in recent wargame exercises. China, he agrees, could “black out the entire island” without much difficulty.

THE NUCLEAR OPTION

“For the last three years, we observed that the PLA is seriously planning and even practicing a blockade or quarantine,” says Tao Yi-Feng, associate professor of politics at Taiwan National University. “The U.S. Indo-Pacific Command also has a lot of concern about this situation, so we have to take it seriously.” Some American military officials believe that Xi has directed the PLA to be ready to take Taiwan by force within two years.

Building resiliency at home, say Tao and other experts, is crucial to deter China and demonstrate Taiwan’s resolve to Donald Trump’s administration.

But as China’s threats have grown more pointed Taiwan has become more, not less, dependent on imported fuel: 83 percent of its power was generated from imported coal, natural gas and oil in 2024, up from 79 percent in 2014. 

The island’s power-hungry microchip manufacturers, the lynchpin of the global artificial intelligence industry, are one reason. But Taiwan’s rigidly ideological, bare-knuckled politics have also become a major impediment to a more sensible energy policy.

In May Taiwan shuttered its last commercial nuclear reactor, the Ma’anshan nuclear plant in southern Taiwan. It was a longtime goal of the ruling Democratic Progressive Party, which has roots in Taiwan’s anti-nuclear movement. Taiwan’s president, Lai Ching-te, and his predecessor are both DPP politicians. “The history of the anti-nuclear movement is the history of the democratization in the early 1990s,” says Sung Chen-en, Vice President of The Prospect Foundation, a government-affiliated think tank.

Meanwhile the island’s build-out of renewable power sources is sputtering in the face of intense resistance from skeptical local residents, city governments and the opposition-controlled legislature. Taiwan generated just 13 percent of its electricity from renewables in the first half of this year, compared to the government’s original target of 20 percent.

Funding for the heavily lossmaking — and vulnerable — transmission grid has also gotten bogged down in the legislative tug-of-war over energy policy.

The DPP-led government supports renewable power in theory but in practice sharply restricts would-be energy producers’ access to land — and to cheap Chinese solar cells. A newly built solar plant in Taiwan can charge the grid about 45 percent more than what the grid pays for coal power – and substantially more than that if it sells directly to an industrial end user. Elsewhere in East Asia, solar is now largely competitive with coal.

The KMT and Taiwan People’s Party, which together took back majority control of Taiwan’s parliament from the DPP last January, have found that the problems caused by rapid renewable growth can be a potent issue in local elections. Onshore solar and wind plants, which can compete with farms for land or threaten wildlife, often face fierce local protests and struggle to secure permits.

The sense I have is that [President Lai’s] administration has decided that they won’t pursue a nuclear option unless there are some revolutionary new nuclear technologies … I think people will be very cautious.

George Yin, a senior fellow at National Taiwan University’s Center for China Studies and the European think tank MERICS

Renewable energy plants have become tangled in corruption scandals, or been marooned without licenses to connect to the grid. New solar capacity rose just 15 percent in 2024, barely half the pace of 2023 and by far the slowest growth on record — and installations slowed further in the first seven months of 2025. Meanwhile power consumption grew 2.9 percent last year, the second fastest rate in the past decade.

For the opposition KMT and Taiwan People’s Party, the answer to Taiwan’s renewable energy challenges is obvious: re-embracing nuclear power.

Taiwan has some good reasons to be skeptical of nuclear power. Like Japan, it is a densely populated island society in a quake zone. And Taipei’s record on transparency and safety, when it comes to waste storage, is highly checkered.

But the public appears to be moving back towards limited acceptance of nuclear energy. Almost 60 percent of respondents to a February poll said they supported shifting to a “low carbon” policy from the current “nuclear free” one. Nearly three-quarters of participating voters backed an August referendum to revive the Ma-anshan nuclear plant, but the resolution still failed because of low turnout.

President Lai, Premier Cho Jung-tai and other top officials have repeatedly said that the government would consider revisiting its stance on nuclear if new technologies prove safer and issues like waste storage can be resolved. Lai also promised that safety checks on the decommissioned Ma-anshan plant would go ahead, despite the failure of the referendum — leaving the door open, in theory, to a restart.

Taiwan faced major blackouts in both 2021 and 2022 due to a combination of human error, a heatwave-induced spike in power consumption, and weather-related shortfalls in hydro power. In March 2022, an accident at a single power plant in Kaohsiung triggered a cascade of plant failures across the island which left nearly 40 percent of households without power. But a weakening economy pushed power consumption back down in 2023, giving the grid some breathing room.

Pressure from businesses and the U.S. is also becoming harder to ignore.

“The U.S., and also some big businessmen like Jensen Huang, all [support a] nuclear plan,” says Sung at The Prospect Foundation.

Huang, the founder of AI chip titan Nvidia, was born in Taiwan and moved to America in his youth; he is idolized by many Taiwanese. Nvidia, the world’s most valuable company, depends on Taiwan’s chip factories to manufacture nearly all its cutting edge chips.

If we’re in a contingency, shipping energy over the ocean in a contested environment or heaven forbid a shooting war, then we need to think about what kinds of energy technologies are available that are resilient to blockade.

Harry Krejsa at Carnegie Mellon, who advised the Biden administration on cyber and energy security

Several American speakers at a supply chain security conference in Taipei this June — including Stephen Yates, the former chair of China policy at the pro-Trump America First Policy Institute and a national security official in President George W. Bush’s administration — mentioned nuclear as a significant area for cooperation amongst democracies or as one potential solution for Taiwan’s energy needs. By contrast Taiwanese speakers, including the president of Taiwan’s state grid company Wang Yao-Ting, spoke almost exclusively about renewable energy options, natural gas or early-stage hydrogen technologies.

The government has made some concessions including a plan to research small modular reactors — an experimental technology that some experts believe will make nuclear safer and cheaper. The task force will provide policy recommendations ahead of the possible global commercialization of SMRs, which could happen by 2030.

Businessmen and scholars with links to the DPP say that privately, officials sometimes agree that a more nuanced position on nuclear is needed. But with nuclear promoters like Tung Tzu-Hsien, deputy chair of the National Climate Change Committee, on the losing side of recent internecine struggles in the government — advocating for nuclear power has become even harder.

“I think for people who actually want to change policy, they won’t talk because it’s really tricky” says George Yin, a senior fellow at National Taiwan University’s Center for China Studies and the European think tank MERICS. “The sense I have is that [President Lai’s] administration has decided that they won’t pursue a nuclear option unless there are some revolutionary new nuclear technologies … I think people will be very cautious.”

THE TRUMP OPTION

Instead of re-embracing nuclear, Taipei seems to be positioning itself to become even more dependent on imported energy — and leveraging its growing energy demand, especially for natural gas, for a different geopolitical purpose.

If the Ma-anshan reactor is not re-started and electricity demand and renewable power output keep growing at their current average annual rates — about one percent and 18 percent respectively over the past five years — then Taiwan’s power grid would still be nearly 80 percent dependent on imported fossil fuels in 2028.

Boosting nuclear output back to 2020 levels, on the other hand, would take import dependence down below 70 percent — and close to 60 percent by 2030.

As President Trump ramps up pressure on major U.S. trading partners, big natural gas purchases are an easy offer for Taiwan, which currently buys most of its gas from Qatar and Australia. In late March, Taiwanese state energy firm CPC Corporation inked a preliminary agreement with Alaska Gasline Development Corp, part of a planned $44 billion project to export fuel to Japan, Korea and Taiwan.

“It is strategically imperative that Taiwan source our LNG from places other than the Middle East,” says Hsu at the Hudson Institute, which recently hosted a delegation from Taiwan including senior executives from CPC Corporation to discuss Taiwan’s energy security.

Hsu adds that he has spoken with U.S. legislators about the idea of an energy security “corridor” linking Taiwan, Japan and the U.S. — including shared investment in LNG infrastructure.

“To deter China, you make it a U.S.-owned asset,” says Hsu. “So if you were to build these terminals jointly financed with the U.S., then it becomes skin in the game for the U.S. to defend its own assets in the theater.”

At the very least, he adds, Beijing would at least have to think twice before interdicting U.S. flagged LNG carriers or attacking American-invested terminals. By contrast Qatar, in the event of conflict in the Taiwan Strait, would likely declare force majeure and cancel deliveries to Taiwan rather than risk angering China.

Still, contracts with U.S., rather than Middle Eastern or Australian, liquefied natural gas suppliers might not necessarily provide much additional assurance in a blockade — unless U.S. providers are willing to commit to quite strict terms.

S&P Global noted last year that LNG suppliers in Singapore have insisted on “act of war” and force majeure provisions in their contracts. These would allow them, in the event of a Chinese blockade of Taiwan, to seek alternative buyers. Force majeure clauses are common in long term LNG supply agreements.

LNG is also extremely energy-intensive and expensive to store, because it must be maintained at very low temperatures. Taiwan had less than two weeks of natural gas inventory in 2024, according to the Ministry of Economic Affairs.

Researchers at the Institute for Democracy, Society and Emerging Technology, a government-funded think tank, reckon Taiwan could keep the lights on for 46 days under full blockade conditions. DSET’s estimate assumes industrial power demand falls drastically during hostilities and mothballed coal power plants come back online. Power rationing might stretch supplies even further, while oil reserves could be stretched to last 151 days.

[Whenever] I think the government is going to pursue measures to increase our resilience, or unity, or our self-defense capability, we will [still] face a lot of challenges from the opposition party.

Chen Fang-yu, Assistant Professor of Political Science at Soochow University in Taipei

But the math could move in the other direction too: if, for example, China targeted offshore wind plants or inclement weather dimmed solar supply. 

“If we’re in a contingency, shipping energy over the ocean in a contested environment or heaven forbid a shooting war, then we need to think about what kinds of energy technologies are available that are resilient to blockade,” says Harry Krejsa at Carnegie Mellon, who advised the Biden administration on cyber and energy security. “That often looks a lot like things that don’t require regular shipments of fuel, like geothermal, nuclear, or solar.” 

ALL POLITICS IS LOCAL

Efforts to address Taiwan’s energy vulnerabilities are, ironically, running headlong into the very thing China most wants to destroy: Taiwan’s robust, and often rancorous, democratic politics. The island’s leaders know they need affordable and reliable alternatives to fossil fuel-dependent power, but are reluctant to challenge the “not in my backyard” reflex instinct of most voters.

“One of the most challenging parts [for] Taiwan now is that we have a very clear external threat,” says Chen Fang-yu, Assistant Professor of Political Science at Soochow University in Taipei. “However, inside we have the legislature, which is highly divided. We cannot even have consensus on the defense budget.

“[Whenever] I think the government is going to pursue measures to increase our resilience, or unity, or our self-defense capability, we will [still] face a lot of challenges from the opposition party.” 

For Taiwan the problem with renewable power sources is land, or rather the lack of it. Solar installations and wind farms need lots of land relative to the power they produce.

Taiwan is one of the most densely populated places on earth, with around 1,700 people per square mile. It is also mountainous — good agricultural land is scarce and Taiwan is a net food importer. 

Solar, in particular, competes with farms and aquaculture — creating a wellspring of anger that local politicians have been happy to tap into, either to win elections or extract additional concessions from developers. Meanwhile at the ministerial level, bureaucratic turf battles have made obtaining land parcels extraordinarily difficult, so much so that a former head of the national solar office was impeached in February for helping developers skirt regulations. Several high profile corruption cases have helped turn many local residents against solar projects.

“Originally we loved to invest in Taiwan because we think there is rule of law,” says a top executive at one of the largest foreign institutional investors in Taiwan’s renewables sector, who asked not to be identified. “And then what happens is the overall political sentiment changed significantly. And then the [KMT] gained more power in the parliament.”

The KMT’s local electoral victories in 2022 and 2024 have made an already fraught situation worse, developers and investors say. The KMT has long been staunchly pro-nuclear and ambivalent towards renewables.

The situation has become so bad that some developers are abandoning Taiwan projects even though there is huge demand for green power from industry, due to government mandates requiring most large power users to buy at least 10 percent of their power from renewable sources.

One executive at a major Taiwanese renewables developer found themselves wading through seven rounds of public hearings on benefit sharing and safety for their planned project in central Taiwan. Despite having already secured every other necessary permit and satisfying all legal requirements, the local industrial bureau simply refused to connect the project to the grid until negotiations were resolved to community representatives’ satisfaction. In the meantime, a group of villagers threatened to bomb the planned project.

The company is now shifting its emphasis towards other major international markets.

And while solar plants have been the most high profile casualties of political brawling, other renewable sectors have also been dragged into the fray. Three waste-to-power projects in Taoyuan, near Taiwan’s largest airport, found their permits revoked last year after a change of city government — and millions of dollars already invested in construction, equipment and land. One developer eventually gave up and sold its land. The other two, including one backed by American private equity, appealed to the national government, and have been negotiating with local authorities.

With onshore power tied up in bureaucratic brawling, the focus of renewable development is increasingly moving onto open water.

Wind capacity growth slowed markedly in 2024, but still managed to rise 45 percent, against 69 percent in 2023. Nearly all of that was offshore. To make up for slowing growth in onshore capacity, offshore wind will have to grow much faster.

As of June, Taiwan’s offshore wind farms could produce just three gigawatts of power, barely half the original 2025 target, against 14 gigawatts of solar. And offshore wind energy is expensive: 20-year fixed feed-in-tariffs were set at 4.5 New Taiwan Dollars, or around 15 cents, a kilowatt-hour last year. The state power company’s average per kilowatt-hour cost — including overhead such as interest and taxes — was only 3.7 NTD in 2024.

There is also the question of just how dependable offshore wind farms would be in the event of a real conflict, as they could be easily disrupted by China’s military. 

China-owned vessels have repeatedly damaged Taiwan’s undersea data cables in recent years, most recently in February. Turbine cables or other grid hardware along the west coast are also tempting targets.

Taiwan’s tricky geography further complicates matters. The bulk of its industry and population is in the north but power generation, especially for solar, is concentrated in the south. That makes the grid very vulnerable to an attack on major south-north transmission lines or other grid hardware.

To protect offshore wind farms, Taiwan can upgrade to armored power cables which are far tougher to cut, says Lu Tsaiying, Director of the Energy Security and Climate Resilience Program at DSET. Building more ships to repair cables will also be essential: currently, the average repair time for undersea communication and power cables is around 40 days, says Lu. 

To resuscitate onshore wind and solar development, loosening strict restrictions on the use of agricultural land — particularly low-yield land — would be most helpful, say developers and investors. But that would require tough compromises with agricultural officials, whose mandate is largely to preserve Taiwan’s ability to feed itself. In wargames, Taiwan’s food reserves typically last far longer than the fossil fuels for its power stations. Last year Reuters, citing the agriculture ministry, reported that Taiwan has seven months’ worth of rice stocks.

A clearer, more codified legal mechanism for resolving disputes with local communities would also help. Taipei recognizes the problem and in March introduced a new set of regulations meant to standardize municipal reviews.

But developers say regulations still leave them too exposed to unscrupulous local actors bent on holding up projects for financial or ideological reasons. “There is a fundamental lack of clarity on what constitutes a ‘successful’ public hearing,” says the executive whose project faced a bomb threat. “Developers are left to fight among ourselves and with the public while the government watches from a distance.”

And without some dilution of the political opposition’s antagonism towards renewables, further large-scale onshore development may remain in limbo — even though, in theory, a grid with lots of solar and wind distributed throughout the island could be more resilient to attack.

“If you had a more distributed generation and storage paradigm in Taiwan, then you could say, ‘Whoops, even if a bomb or a cyberattack did take down some strategic nodes, then the grid would be able to self-heal and fail [only in] smaller segments,’” says Krejsa at Carnegie Mellon.

Lu, of DSET, says the government’s goal of 20 percent renewable power — now pushed back to 2026 — is achievable if the new regulations smooth the local approval process for solar projects and the government shores up the grid’s finances.

But the latter would require the opposition-controlled legislature to sign off on new state funding — or for the government to raise power prices, and risk alienating voters.

In the past few years, the political play [has] become a more important focus rather than focusing on real energy policies.

a top executive at one of the largest foreign institutional investors in Taiwan’s renewables sector

“Taipower is pushing for its grid enhancement project,” says Lu. “And that is very critical for Taiwan’s renewable transition because … infrastructure gaps. We need the money to do that.”

To protect the grid, state utility Taipower is investing heavily in hardware like distributed energy storage and static synchronous compensators — “shock absorbers” which make it less likely that a single large power failure takes out large parts of the transmission network. It also plans to build more transmission nodes and harden vulnerable transmission substations. But Taipower is also operating under huge financial stress thanks to the lingering effect of fuel price spikes from the Ukraine war and pricier renewable power.

In mid September Taipower said it would increase electricity prices for residents and small stores by an average of 3 percent. Even higher prices may be necessary. The new average residential rate will remain below 3 NTD, or about ten cents, per kilowatt-hour. Taipower’s average per kilowatt-hour cost is 3.8 NTD. 

The company made a small pretax profit in the first seven months of July. But its losses from 2022 to 2024 totaled over 400 billion NTD, or about $13 billion. That is equal to over two thirds of the entire planned budget for the ten year grid improvement plan announced by Taipower in 2022.

Until the DPP, KMT and other parties are willing to make painful compromises, the island’s energy strategy will remain hostage to both local and national politics. With no meaningful commitment to nuclear, and renewable power projects wrapped up in red tape and opposed by “not in my backyard” campaigns, Taiwan’s appetite for easily interrupted LNG shipments will continue to grow.

“In the past few years, the political play [has] become a more important focus rather than focusing on real energy policies,” says the executive at the large foreign renewables investor.

“People’s decision is, in a way, … how does that work in our favor, in our party’s favor, rather than really consider, as a nation, how you can achieve a bigger goal.”

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