Taiwan Mulls Nuclear Revival to Cut Its LNG Exposure

Taiwan is moving to reverse parts of its recent nuclear phaseout after surging LNG prices and growing import dependence exposed the economy to higher energy costs and supply risk. Taipower filed a restart application for the Maanshan nuclear power station in March 2026 and the regulator began substantive review in April, reaching a concluding review round by July. A May 2025 amendment to the Nuclear Reactor Facilities Regulation Act allows reactors with expired licences to seek renewals of up to 20 years, creating a legal path for restarts. The island’s energy mix shifted substantially after the Democratic Progressive Party pursued a phaseout and reduced coal use; natural gas rose from supplying 30.6% of electricity in 2015 to 50.5% by July 2026. Taiwan is fully reliant on imported LNG, which rose to 23.6 million tonnes in 2025 and has continued increasing in 2026. The March 2026 US–Iran war and consequent blockade of the Strait of Hormuz disrupted supplies—most notably Qatar’s shipments—and drove the JKM Asian spot benchmark to roughly $29/MMBtu, about triple its level six months earlier. Supply changes forced Taiwan to reorganise its purchases: US shipments temporarily accounted for 48% of imports in June 2026 (around 880,000 tonnes) but fell to 470,000 tonnes in August, while Australian deliveries rose to 950,000 tonnes in July and 1.1 million tonnes in August. The higher LNG costs have raised inflation forecasts (from 1.93% to 2.07% in August) despite consumer protection measures and significantly strained public finances. Taipower reported a first-half pre-tax loss of about US$810 million and expects more than US$3.8 billion in extra fuel costs for 2026; the government has proposed a US$13.3 billion energy package to recapitalise CPC and subsidise energy costs. Restarting nuclear plants would restore nearly 3.9 GW of capacity and could displace several million tonnes of LNG a year. Maanshan’s two 951-MW units together provide about 1.9 GW; Taipower aims to bring unit 2 back in 2027, which could replace roughly 1 million tonnes of LNG annually, with the second unit’s return not expected before 2028. Kuosheng’s two 985-MW reactors add about 1.97 GW and could bring total potential displacement across four reactors to around 4–4.5 million tonnes a year, but Kuosheng restarts are not likely before 2031 due to spent-fuel removal and storage requirements. Even with restarts, some nuclear output would meet growing demand—projected by the Ministry of Energy to rise about 2.5% annually over the next decade—so nuclear would slow but not eliminate Taiwan’s need for LNG. Policymakers and utilities face a timing and contracting dilemma: they must secure sufficient LNG to cover short-term needs while avoiding long-term overcommitment if nuclear generation returns. Flexible delivery terms and staggered contract expiries could help balance the risk that reactor restarts are delayed against the cost of buying expensive spot cargoes or paying for surplus contracted volumes.