In 2009 Taiwan approved the Renewable Energy Development Law and the renewable energy feed-in tariffs (FIT) for each kind of renewable energy have been implemented. Setting tariff rates for renewable energies relates to two major goals: the achievement of renewable energy development targets and green industry development. Therefore, the calculation of an appropriate tariff level that provides appropriate incentives, captures renewable energy development targets and involves the most efficient method for fund collection is the key factor to the success of FIT. The purpose of this study is to explore the merits and shortcomings of Taiwanese FIT policy. We adopted the comparative study of the experiences of implementing FIT by several important countries of the world. Further, we analyzed the advantages and disadvantages of FIT policy theoretically and compared it with renewable portfolio standards (RPS) policy to find out how to improve it. The results indicated that accurate tariffs can never be found under the uncertain market conditions. Therefore, it is necessary to adopt some key factors of PRS such as bidding process and setting cap amount in designing a successful FIT policy. The conclusion is that a FIT policy alone can not achieve its goals and it needs to be coupled with PRS policy to be able to develop renewable energy efficiently and effectively. Hopefully, the experience of FIT renewable purchase policy in Taiwan can contribute to the successful deployment of renewable energy in the world.
