Energy policy failure: Taiwan urged to pursue 30% nuclear power and North American LNG at TTX

Experts at a high-level tabletop exercise warned that Taiwan's energy transition has fallen short and urged a decisive policy shift toward nuclear power and diversified LNG sourcing.

Scenario setting and strategic frame

At the “2026 Political, Economic, Military, and Psychological-Societal Tabletop Exercise” (2026 TTX), for which TCN is the exclusive media partner, experts examined Taiwan’s resilience under a rapidly shifting global order. The simulation is set against a post-Trump landscape defined by sustained US-China strategic competition, compounded by Middle East conflicts, energy supply disruptions, and rising regional tensions.

Within this framework, China is assumed to intensify “gray-zone coercion” against Taiwan through coordinated political, military, and economic measures, with the possibility of escalation toward blockade-oriented actions.

Moving beyond conventional war-gaming focused on kinetic conflict, the 2026 TTX adopts an integrated political, economic, military, and societal approach. Through multi-scenario simulations and iterative decision-making, it evaluates policy constraints, interdependencies, and cascading risks, aiming to generate feasible and strategically coherent policy responses.

Move focus: energy security and resilience

One of the key moves in the exercise centered on energy security.

The scenario introduced a geopolitical shift in which China and Russia deepen cooperation through a joint Far East development plan signed in 2027, advancing Arctic development.

Within this context, the simulation examined Taiwan’s energy security under conditions of geopolitical disruption and potential blockade. It highlighted vulnerabilities stemming from Taiwan’s dependence on imported energy and stresses within supply chains under constrained access.

Participants were tasked with weighing policy trade-offs, including diversification strategies and the role of nuclear energy.

Pre-move warning: limited reserves and structural exposure

Before the simulation began, economist Liang Chi-yuan (梁啟源) told TCN that Taiwan’s crude oil reserves would last roughly 100 days, while liquefied natural gas (LNG) reserves stood at only around 11 days.

He said nearly half of Taiwan’s energy supply — approximately 47% — comes from natural gas, with about one-third sourced from the Middle East. This means that roughly one-sixth of Taiwan’s total energy supply is directly exposed to disruptions linked to regional conflict or a closure of the Strait of Hormuz.

Liang told TCN that, compared with Japan and South Korea, Taiwan is more heavily reliant on Middle Eastern energy imports and is therefore more vulnerable to external shocks.

While domestic fuel and electricity prices have remained relatively stable, he warned that this masks a broader global trend of heightened preparedness. Current supplies, he noted, still reflect shipments dispatched before any disruption to Hormuz.

Move conclusion: policy failure, nuclear reboot, renewables, and North American LNG

Following the exercise, Liang concluded that Taiwan’s current energy transition trajectory has fallen short, particularly in meeting renewable development targets. Rising demand driven by semiconductors and AI, combined with global oil and gas shortages linked to ongoing Middle East conflicts, has also exposed the risks of heavy reliance on gas-fired power generation, including the potential for power shortages.

To mitigate such risks, Liang said that decommissioned coal-fired units in Taiwan were retained or repurposed as emergency backup capacity. He acknowledged that this approach would increase coal’s share in the energy mix, with corresponding implications for air quality and carbon emissions.

He stated that the government of Taiwan "must acknowledge the policy failure."

A central recommendation emerging from the exercise is the need to reassess Taiwan’s nuclear-free policy, Liang said. Liang stated that after discussions, experts found that it is recommended that Taiwan accelerate life extensions and potential restarts of existing nuclear plants, alongside actively promoting new nuclear projects.

He noted that among 31 economies operating nuclear power, only Germany and Taiwan have pursued full phase-outs, while recent statements by European leaders have characterized such policies as strategic missteps.

Drawing comparisons with Japan and South Korea, Liang said Taiwan should target a 30% nuclear share by 2050, with interim benchmarks of 10% by 2029 and 16% by 2035.

On nuclear waste, Liang said that dry storage could serve as an interim solution for several decades, with longer-term disposal options potentially involving remote offshore islands or international cooperation.

Beyond nuclear energy, the exercise highlighted the importance of complementary measures, including the expansion of energy storage, smart grids, virtual power plants, demand-side management, and AI applications to enhance system stability.

Additional recommendations included enabling corporations to procure green electricity directly through a market-based mechanism linked to Taiwan Power Company pricing, adjusting electricity tariffs to better reflect costs, strengthening recycling systems for renewable infrastructure, reinforcing grid resilience, and expanding LNG procurement from North America.

Taken together, the exercise underscored the scale of Taiwan’s energy challenge and the breadth of policy adjustments required to address it.