Germany-based InfraVest, the largest private wind power company in Taiwan, said Friday it will withdraw from the island because it does not have confidence in the government's energy policies.
InfraVest said a newly announced government purchasing price for wind power was below the cost of producing it, forcing the company to concentrate on mainland China instead.
The island's government has agreed to pay 2.38 Taiwan dollars (seven US cents) per kilowatt hour, which is lower than the company's cost of around 2.8 dollars.
"InfraVest will incur losses on such a low purchasing price. We can't help but doubt the government's determination to develop renewable energy," company vice president Wang Yun-yi told AFP.
"We have decided to withdraw from Taiwan and refocus our greater China operations on the mainland instead of Taiwan," she said.
InfraVest has invested more than 10 billion Taiwan dollars in the island since it arrived in 2000, according to Wang.
Currently, InfraVest runs three wind farms in Taiwan, while construction of another two farms has just ended, and trial operations have begun.
She said the company will dispose of its Taiwan assets, but she did not disclose a timetable.
The economics ministry said it will communicate with InfraVest, hoping to reverse its decision to withdraw from Taiwan.
"The new purchasing price was set after careful studies, higher than the previous 2.00 dollars," said Wang Yun-ming, deputy director of the ministry's energy bureau.
"Taiwan has a great potential in developing wind energy, and with costs falling the price is fair."
Wang said the government was determined to push for renewable energy and will not change its stand.
"We will continue to provide tax incentives to operators and help them resolve problems regarding land procurement for factory construction," he said.
Explore further: Team develop 'autotune' software to make it quicker, easier and cheaper to model energy use of buildings