The incident happened at the Xingda (Hsinta) power plant in southern Taiwan's Kaohsiung city this afternoon. It remains unclear what caused the accident but power was restored as of this evening, according to the island's main electricity supplier Taipower.
"Our operating reserves were only 10.01pc as of today." Taiwanese president Tsai Ing-wen said. "This was not a problem with the power plants per se but due to issues with our grid. This underscores the importance of balancing Taiwan's regional power supply and highlights the importance of risk management of our power grid," she added.
Taiwan's power reserves were previously around 15pc of its installed capacity, which is lower than Singapore's 30pc and below the average of 20pc for many other countries, its ministry of economic affairs said in March. This suggests that Taiwan is facing a relatively serious energy shortfall as the increase in power usage outpaces supply.
The outage comes just weeks after Taipower warned that the island's power consumption could hit new highs as the peak summer demand months approach. It had earlier urged the population to restrict electricity use as the island's worst drought in 56 years has significantly curtailed hydropower output, increasing reliance on thermal and nuclear power.
Around 4mn Taiwanese homes were affected by the blackout, economics affairs minister Wang Mei-Hua said. It is understood that disruptions to the critical semiconductor industry in Taiwan have been minimal.
The latest incident could push Taiwanese coal importers to increase purchases as the island seeks to strengthen its power reserves to meet rising consumption. Taiwanese imports of thermal coal have risen steadily for the past two months. Its receipts of Australian thermal coal have assumed greater significance because of an arbitrage advantage against similar quality Russian material, which has been the subject of aggressive bidding by Chinese consumers. A ban on Australian product by China since last year has sustained the arbitrage for Australian coal to be shipped to markets such as Taiwan.
