Photo: Fumaroles in Yangmingshan National Park, northern Taiwan, photo by: Marcin Jerzewski
What is happening?
Taiwan’s appetite for energy is voracious, which renders conversations about how to satiate it rather fervid. On May 17, the government of William Lai (賴清德) took a crucial step toward realizing its “nuclear-free homeland” strategy by shutting off the last functioning nuclear reactor in the country. At the same time, the Ministry of Economic Affairs predicts that energy demand will rise by approximately 13 percent by 2030, a trend reinforced by the growth in the semiconductor market and Lai’s ambition to make Taiwan a leader in artificial intelligence (AI) technologies. Consequently, Taiwan’s ongoing energy transition is a highly consequential process with significant ramifications not only for its industrial policy and global competitiveness but also for its security posture and domestic politics.
Amid efforts to increase the share of renewables in Taiwan’s energy mix, a previously underappreciated technology is slowly making its way into the limelight – geothermal energy. Located in the Pacific Ring of Fire, the island boasts significant geothermal resources with potential estimates ranging from 1 to 6 GW for electricity generation. European companies are at the forefront of realizing this potential.
What is the broader picture?
There is a witch’s cauldron in Taiwan’s capital, Taipei. The northernmost district of Beitou (北投), renowned among hot spring aficionados, derives its name from the language of the Ketagalan people, the Indigenous inhabitants of the Taipei basin. Fascinated by the subterranean heat from the Datun volcanic area, they likened the naturally occurring scorching waters to the land of sorceresses – Pataauw. Today, geothermal potential is more than a thaumaturgist’s secret or a fuel for urbanites’ spa time – it can be a meaningful source of energy.
Taiwan’s geological position on the Pacific Ring of Fire gives it access to a steady and reliable baseload power source that complements intermittent renewables. Unlike solar or wind, geothermal plants can provide 24/7 electricity, making them ideal for critical sectors such as manufacturing, healthcare, and data centers. With an estimated geothermal potential of up to 6 GW, Taiwan has set ambitious targets: 20 MW by 2025, 200 MW by 2030, and 6 GW by 2050. However, high upfront costs, regulatory uncertainty—especially in indigenous and protected areas—and limited public awareness still impede rapid development.
In 2024, Taiwan generated over 82 percent of its electricity from thermal sources, primarily oil and gas. Renewables made up just under 12 percent of the overall energy mix, falling short of the 20 percent target set for 2025. Solar and wind power were the dominant renewable sources, together accounting for more than three-quarters of total renewable generation. The production of geothermal power remained at 7 MW.
Why is it important?
With sustained political will, private sector engagement, and international collaboration, geothermal energy can be transformed from a niche opportunity into a significant pillar of Taiwan’s secure, sustainable energy future.
Closer cooperation between Europe and Taiwan on geothermal energy could be conducive to overcoming these barriers and building momentum. There are several concrete policy actions to propel joint work in this sector.
First, establishing a Taiwan–EU Geothermal Innovation Partnership would support joint research and development (R&D), demonstration projects, and technology transfer. Second, harmonizing standards and certification between the two regions could streamline permitting processes and encourage European investment. Third, a geothermal demonstration fund, supported by state-owned banks and investment entities, would help de-risk early-stage projects and attract private capital. Fourth, structured mobility and workforce exchange programs, particularly for professionals transitioning from the oil and gas sector, can strengthen the geothermal talent pipeline. Finally, geothermal energy should be incorporated into EU–Taiwan dialogues on green trade and energy diplomacy, positioning Taiwan as a key partner in regional clean energy resilience.
