What are the energy stocks in Taiwan? An in-depth analysis of investment opportunities in new energy concept stocks

As the global energy transition accelerates, Taiwan’s new energy sector is gradually becoming a focus for investors. From solar and wind power to the electric vehicle supply chain, Taiwanese new energy companies are playing an increasingly important role in this energy revolution. For investors looking to enter this field, understanding which Taiwanese energy stocks are available and their respective advantages is a prerequisite for making informed decisions.

Current Status of Taiwan’s New Energy Market: Opportunities and Challenges Coexist

Disparity in the Share of Renewable Energy

Data shows that in 2022, renewable energy accounted for nearly 30% of the global power structure, while Taiwan’s share was only 8%. In contrast, advanced European countries have over 40%, Japan 22%, and even Thailand 18%. This comparison clearly reveals the enormous growth potential of Taiwan’s new energy industry.

In terms of energy self-sufficiency, Taiwan imports 97.3% of its energy consumption, with only 2.7% produced domestically, indicating significant pressure on energy security. The government has set clear targets for 2025: 20GW of solar photovoltaic capacity, 5.6GW of offshore wind power, aiming to increase renewable energy’s share of national power generation to 15.1%. These policy supports provide strong growth expectations for related new energy companies.

A Major Transformation in Energy Structure Is Underway

Currently, coal and natural gas still account for 80.88% of Taiwan’s power supply, with renewable energy only 8.27%. As the 2025 non-nuclear homeland goal advances, nuclear power (which previously accounted for 8.24%) must be replaced by other energy sources, meaning the new energy industry could see at least double growth in the next 2-3 years.

Overview of Major New Energy Concept Stocks in Taiwan

1. Delta Electronics (2308): Dual Engines in Energy Storage and Automotive Electronics

Many only know Delta Electronics as a major electronics manufacturer, but they overlook its technological accumulation in the new energy field. Energy storage systems are crucial for promoting renewable energy—solar and wind power outputs cannot compare to traditional coal-fired power, requiring efficient storage systems for regulation. This is Delta’s strength.

In automotive electronics, Delta has already established a scale, with 75% of the top 20 global automakers as clients. As electric vehicle penetration increases, this business segment has greater growth potential.

In June 2023, Delta Electronics’ consolidated revenue reached NT$34.825 billion, up 8% year-over-year, setting a record high for the same period. Over the past three years, revenue has accelerated from NT$28.26 billion in 2020 to NT$38.44 billion in 2022. The strong performance of the electric vehicle division is a key driver of revenue growth.

2. Suncore Energy (6806): From Engineering Contracting to One-Stop Operation and Maintenance Service Provider

Suncore focuses on solar, wind, and new energy investment development, offering full-chain services from site assessment to completion warranty. The company went public in November 2022, with first-year revenue of NT$4.301 billion. After entering 2023, performance significantly improved, with April revenue reaching NT$774 million, mainly benefiting from revenue recognition of the Taipower offshore wind project phase two.

In the next two years, this project revenue will gradually be recognized, and the company’s profitability is expected to grow substantially. For investors optimistic about the long-term prospects of new energy, this company is worth watching.

3. Huasheng (1519): Dual Benefits from Grid Upgrades and Charging Piles

Huasheng is a long-term partner of Taipower, supplying transformers and other grid equipment. In 2022, Taipower announced a 10-year, NT$564.5 billion “Enhanced Grid Resilience Construction Plan,” which Huasheng will directly benefit from through large-scale infrastructure upgrades.

At the same time, Huasheng is also a leader in Taiwan’s electric vehicle charging pile industry, with nearly 20% market share. As EV adoption rises, demand for charging stations continues to grow. In the first half of 2023, Huasheng’s performance was strong, with Q2 revenue up 51.72% year-over-year, and first-half revenue up 34.96%, both reaching new highs for the same period.

Notably, the company’s stock price has risen 242.56% since the beginning of the year, with short-term correction pressure possible. Investors may consider entering when the price becomes more attractive.

4. Motech (5483): Benefiting from Global Energy Transition

The US Inflation Reduction Act passed in 2022 will invest US$369 billion to support energy transition, expected to increase US solar capacity by 69% over the next decade. As Taiwan’s leading solar company, Motech is a direct beneficiary of this wave of energy transition.

In 2022, Motech’s solar business revenue surpassed NT$10 billion, reaching NT$10.25 billion, up 34.5% year-over-year. However, due to the decline in upstream silicon material prices this year, the company’s revenue faces pressure. Investors should monitor upstream raw material price trends and consider buying when prices rebound.

The Double-Edged Sword of Investing in New Energy Stocks

Advantages

The new energy sector aligns with the global ESG investment trend and is likely to be included in mainstream funds. The industry itself has huge growth potential, with many governments offering tax incentives, subsidies, and other support policies. Additionally, new energy has low correlation with traditional industries, effectively diversifying investment portfolio risks.

Risks

New energy concept stocks tend to be volatile and are susceptible to policy changes and energy price fluctuations. Most new energy companies are in expansion phases, with unstable earnings and dividend stability, making them unsuitable for conservative investors. Stock selection is also relatively challenging, requiring strong research capabilities.

Three Recommendations for Investing in New Energy Stocks

Prepare for the Long Term

The new energy industry is a century-long plan, not suitable for short-term trading. Investors should establish a long-term holding mindset; otherwise, they risk being scared out by short-term fluctuations.

Control Risks and Gradually Allocate

Emerging green energy companies often experience significant performance fluctuations. It is advisable to buy in batches, control individual investment sizes, and set stop-loss points.

Pay Close Attention to Policies and Data

Government policy support and upstream raw material price changes can significantly impact the performance of new energy stocks. Investors need to stay sensitive to relevant information.

Summary

Taiwan’s new energy concept stocks are at the intersection of policy support and industry prosperity. As the share of renewable energy increases from 8% to the target of 15%, the entire industry chain will receive long-term growth momentum. Whether in energy storage, solar, wind, or electric vehicle-related companies, there are investment opportunities to explore.

The key is to choose the right companies, the right timing, and to manage risks properly. For investors optimistic about the long-term prospects of energy transition, now is a good time to deepen understanding and consider positioning in Taiwan’s energy stocks.