Taiwan's energy sector is identified as the most vulnerable component in the nation's resilience, according to the Center for Strategic and International Studies (CSIS).
The Center for Strategic and International Studies (CSIS) has released a report outlining the potential consequences of a Chinese energy blockade on Taiwan. The report, based on 26 simulations, reveals that Taiwan's natural gas supplies would last about 10 days, coal supplies would deplete in seven weeks, and oil reserves would run out in 20 weeks under such a blockade.
This scenario underscores Taiwan's vulnerability to energy blockades by China but also emphasises that Beijing would face high costs and risks if it attempted such a blockade, as it could escalate into broader conflict involving the United States.
To counter or mitigate a Chinese energy blockade, Taiwan could adopt several strategies. One such strategy is the diversification of energy sources and supply chains. Taiwan's state oil company, CPC Corporation, is exploring partnerships and investments in U.S. shale gas production and projects such as the Alaska gas pipeline to enhance energy independence and leverage stable suppliers like the United States.
Another strategy involves strengthening domestic energy resilience through technological innovation, decarbonization, and sustainable energy development. Taiwan's government promotes public-private collaboration on advanced energy technologies as part of its climate change response and long-term net-zero emissions roadmap, which also improves energy security by reducing dependency on imported fossil fuels.
Strategic military deterrence and alliance-building are also crucial in increasing the costs of a blockade for China. Taiwan is investing in its own defense capabilities and aligning more closely with regional actors in the Indo-Pacific to deter aggressive actions and reduce Beijing's ability to impose a blockade without risking wider conflict and international involvement.
Taiwan could also reduce its dependence on energy imports by building strategic reserves of oil, gas, and coal, and maintaining its last nuclear reactor. The nation's energy grid should be hardened by measures such as having stockpiles of transformer and turbine spare parts.
Other key capabilities include increasing the number of gas carriers, replacing insurance companies unwilling to cover commercial shipping in war zones, and enhancing energy resilience. A vast merchant fleet is considered the most important capability in this regard.
A Chinese energy blockade on Taiwan poses a severe but not insurmountable challenge. Such a blockade could lead to paralysis for Taiwan's manufacturing sector, including the production of chips that contribute significantly to the world economy.
The CSIS report stresses that while Taiwan is vulnerable, Beijing faces significant risks in attempting a blockade, which could deter such a move outright or at least buy time for Taiwan to respond. The report was published by the Center for Strategic and International Studies on Thursday, following a series of war games conducted by the organisation.
- In light of the energy vulnerability highlighted by the CSIS report, Taiwan should diversify its energy sources and supply chains, as evidenced by its state oil company, CPC Corporation, pursuing partnerships and investments in U.S. shale gas production and projects such as the Alaska gas pipeline.
- Recognizing the potential risks and costs associated with a Chinese energy blockade, Taiwan is also focusing on strengthening domestic energy resilience through technological innovation, decarbonization, and sustainable energy development, aided by public-private collaborations on advanced energy technologies.
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