MOEA Releases Standard Administrative Contract for Round 3 Offshore Wind Zonal Development　Clarifying Developers' Rights and Obligations

Following the Ministry of Economic Affairs' (MOEA) public announcement on March 27, 2026, of the selection mechanism for Round 3 Offshore Wind Zonal Development Program, and subsequent briefing sessions on the draft administrative contract for offshore wind zonal development held on April 2 and April 29, the MOEA today (July 23) released the standard administrative contract template for Round 3.

In addition to specifying developers' principal obligations and penalties for contractual breaches, the Round 3 contract also introduces new incentive mechanisms, including a guaranteed minimum power purchase price and an extension of the power sales period.

The MOEA explained that, to expand overall development capacity under this allocation round, selected developers may be allocated additional expansion wind farm capacity in sequence. Separate administrative contracts will be executed for the originally allocated wind farm and the expansion wind farm, with the rights and obligations of each project governed independently under its respective contract. This arrangement is intended to provide greater clarity regarding project-specific responsibilities and financing requirements.

Both the allocated wind farm and the expansion wind farm will be eligible for the incentive mechanism that allows an extension of the power sales period. However, given that the allocation of expansion capacity is contingent upon the developer's performance in fulfilling its obligations under the originally allocated wind farm, the performance bond for the allocated wind farm will continue to secure the obligations of the expansion wind farm. The maximum liability under such security shall be capped at the amount of the performance bond required for the expansion capacity.

The MOEA stated that the Round 3 administrative contract further clarifies the verification procedures and liabilities for non-compliance with ESG-related obligations concerning local industry/economic benefits and energy resilience. Contracted developers are required to submit implementation plans within six months after achieving financial close or within six months after project completion and grid connection, as applicable, and to provide periodic progress reports thereafter. The MOEA will conduct final verification upon project completion and grid connection, as well as five years after completion and grid connection.

If a developer fails to fulfill its obligations regarding local industry/economic benefits, the MOEA may claim liquidated damages equal to 20% of the difference between the committed procurement or investment amount and the actual procurement or investment amount. In cases of material breach, such as repeated delays in implementation without corrective action, an additional penalty equal to 10% of the investment shortfall may be imposed to safeguard the fairness of the allocation process.

With respect to the release of the performance bond, the MOEA noted that, in light of the verification timeline for energy resilience commitments, the performance bond will be released in stages under this allocation round. Following project completion and grid connection, the MOEA will retain a portion of the performance bond equivalent to 20% of the committed procurement or investment amount for the energy resilience items. This retained amount will be released upon completion of the energy resilience verification.

In addition, drawing on the experience gained from the demonstration incentive program and previous rounds of zonal development, this allocation round introduces a one-year flexible grid connection mechanism. Contracted developers may apply to the MOEA for a one-year extension of the project completion and grid connection deadline upon achieving either of the following milestones: (i) installation of the substructures for all wind turbine generators, or (ii) completion and grid connection of at least 50% of the project's total installed capacity.

The administrative contract also establishes a guaranteed minimum power purchase price of NT$2.29 per kWh, providing developers with greater certainty in assessing and managing project development risks.

The MOEA emphasized that offshore wind power remains a key pillar of Taiwan's energy transition. In addition to the planned allocation of 3.6 GW under this selection round, capacity associated with previously terminated project sites will also be included as expansion capacity.

Through an open and transparent selection process, the MOEA will identify developers with proven track records and strong implementation capabilities, and will proceed with the relevant procedures in accordance with the established timetable, with the goal of completing the selection process in 2026. These efforts are intended to support the steady development of the offshore wind industry and advance Taiwan's transition toward its 2050 net-zero emissions target.

Source: Ministry of Economic Affairs (English translation by EnergyOMNI)