Fitch Confirms ‘AAA(twn)’ Rating for Taiwan Power Company’s Proposed TWD16.6 Billion Bond Issuance

Taiwan Power Company Secures Top Credit Rating for New Bond Offering

september 4, 2025

Taipei, Taiwan – Taiwan Power Company (Taipower) has been assigned a ‘AAA(twn)’ rating by Fitch Ratings for its anticipated New Taiwan Dollar (TWD) 16.6 billion bond. This assessment underscores the Company’s robust financial health and stability, as announced today. The rating reflects Taipower’s critical role in Taiwan’s energy infrastructure and its strong Governmental support.

understanding the ‘AAA(twn)’ Rating

The ‘AAA(twn)’ designation represents the highest credit quality rating issued by Fitch Ratings in Taiwan. It indicates an exceedingly low default risk. This favorable rating allows Taipower to access capital markets at competitive rates, further strengthening its financial position. Similar ratings are reserved for entities perceived as exceptionally creditworthy, with a consistent ability to meet financial obligations.

Did You Know? Taiwan’s energy sector is undergoing meaningful change, aiming for a more sustainable mix with increased renewable energy sources.

Implications for Taiwan’s Energy Sector

This positive rating is particularly significant given Taiwan’s ongoing investments in upgrading its energy infrastructure. The funds raised through this bond issuance will likely be directed towards bolstering grid reliability, expanding renewable energy capacity, and modernizing existing power plants. According to Taiwan’s Bureau of Energy, renewable energy sources accounted for approximately 21.7% of the island’s total electricity generation in 2023, a figure the government aims to increase substantially in the coming years. Taiwan Bureau of Energy

Key Details of the Bond Issuance

Issuer	Rating	Amount	Currency
Taiwan Power Company (Taipower)	AAA(twn)	TWD 16.6 billion	New Taiwan Dollar

Pro Tip: Credit ratings from agencies like Fitch are vital indicators for investors, influencing borrowing costs and overall market confidence.

the accomplished attainment of this rating highlights Taipower’s continued financial strength and its capacity to support Taiwan’s evolving energy demands. This will enable the company to continue modernizing its infrastructure and pursuing its renewable energy goals.

The Importance of Credit ratings in infrastructure Advancement

Credit ratings play a crucial role in large-scale infrastructure projects. A robust rating,such as the one received by Taipower,not only lowers borrowing costs but also attracts a wider pool of investors,demonstrating confidence in the project’s viability and the issuer’s ability to repay its debts.This ultimately facilitates the efficient financing needed for essential infrastructure improvements.

Furthermore, these ratings provide openness to the market, allowing investors to assess risks and make informed decisions. This transparency fosters stability and encourages long-term investment in critical sectors like energy.

Frequently Asked Questions about Taipower’s Bond Rating

• What does a ‘AAA(twn)’ rating mean? it signifies the highest credit quality assigned by Fitch Ratings in Taiwan, indicating a very low risk of default.
• How will this bond issuance benefit Taiwan? The funds will support upgrades to the energy infrastructure, including renewable energy projects.
• What is the role of Fitch Ratings? Fitch Ratings is a leading global credit rating agency that assesses the creditworthiness of debt issuers.
• What is Taiwan Power Company’s primary function? Taipower is the primary electricity provider in Taiwan,responsible for generation,transmission,and distribution.
• Why are credit ratings crucial for investors? They provide an assessment of risk, helping investors make informed decisions about where to allocate capital.

What are yoru thoughts on Taiwan’s investment in renewable energy? Share your opinions in the comments below!

What factors contributed to Fitch’s decision to affirm a ‘AAA(twn)’ rating for Taipower’s bond issuance?

Rating Details & significance

Fitch Ratings has affirmed the ‘AAA(twn)’ Long-Term Issuer Default Rating (IDR) for Taiwan Power Company (Taipower) regarding its proposed TWD16.6 billion bond issuance. This rating, assigned on september 4, 2025, reflects Taipower’s crucial role as taiwan’s primary electricity provider and the strong sovereign support it receives. The ‘AAA(twn)’ rating signifies the highest credit quality within the Taiwanese national scale, indicating an extremely low default risk. This bond issuance is a key component of Taipower’s financing strategy for ongoing infrastructure projects and operational needs.

Understanding the ‘AAA(twn)’ Rating

The ‘(twn)’ suffix denotes a national rating, meaning its calibrated to the credit risk within Taiwan specifically. It doesn’t directly equate to Fitch’s international ratings scale, but it represents the highest possible rating within the Taiwanese context.

Here’s a breakdown of what this rating communicates:

Strong Capacity to Meet Financial Obligations: Taipower demonstrates a robust ability to meet its debt obligations as they come due.

Sovereign Linkage: The rating is heavily influenced by Taiwan’s sovereign credit profile,indicating a high probability of government support if needed.

Strategic Importance: Taipower’s essential role in Taiwan’s economy and infrastructure underpins its creditworthiness.

Low Credit Risk: Investors can expect a very low risk of default on this bond issuance.

bond Issuance Breakdown: TWD16.6 Billion

The proposed TWD16.6 billion bond issuance will be utilized by Taipower for several critical purposes:

1. Infrastructure Investment: Funding upgrades and expansions to Taiwan’s power generation and transmission infrastructure. This includes investments in renewable energy sources and grid modernization.
2. Refinancing Existing Debt: Optimizing Taipower’s debt profile by refinancing existing obligations, potentially lowering overall borrowing costs.
3. Working Capital: Supporting day-to-day operational expenses and ensuring sufficient liquidity.
4. Energy Transition: Supporting taiwan’s broader energy transition goals, including increasing the share of renewable energy in the power mix.

Factors Supporting the Rating: A Deeper Dive

Several key factors contributed to Fitch’s decision to affirm the ‘AAA(twn)’ rating:

Government Ownership: Taipower is wholly owned by the Taiwanese government, guaranteeing a strong level of support.

Regulatory Framework: The company operates within a regulated framework that provides a degree of revenue stability.

Monopoly Position: Taipower maintains a dominant position in the Taiwanese electricity market, ensuring a consistent demand for its services.

Essential Service Provider: Electricity is a essential necessity, making Taipower’s services indispensable to Taiwan’s economy and population.

Taiwan’s Sovereign Rating: Taiwan’s own credit rating plays a significant role,as taipower is considered a proxy for sovereign credit risk.

Implications for Investors

This ‘AAA(twn)’ rating offers several benefits to potential investors:

High Credit Quality: The bond represents a very low-risk investment opportunity.

Stable Returns: Investors can anticipate stable and predictable returns on their investment.

Portfolio Diversification: The bond can provide diversification benefits to investment portfolios.

Support for National Infrastructure: investing in Taipower’s bonds contributes to the development and modernization of Taiwan’s critical infrastructure.

Alignment with ESG Goals: Investments in renewable energy projects funded by the bond issuance align with Environmental, Social, and Governance (ESG) investment principles.

Taipower’s Role in Taiwan’s Energy Landscape

Taipower is central to Taiwan’s energy security and economic development. The company is responsible for:

Power Generation: Operating a diverse portfolio of power plants, including coal, nuclear, gas, and renewable energy facilities.

Transmission & Distribution: Maintaining and expanding Taiwan’s high-voltage transmission network and distributing electricity to consumers across the island.

Energy Planning: Developing long-term energy plans to meet Taiwan’s growing electricity demand.

Renewable Energy Integration: Actively integrating renewable energy sources into the grid, supporting Taiwan’s commitment to a sustainable energy future.

Recent Developments & Future Outlook

Taiwan has been actively pursuing a transition towards a more sustainable energy mix, with a focus on increasing the share of renewable energy. Taipower is at the forefront of this effort, investing heavily in solar, wind, and other renewable energy projects. The company is also working to modernize its grid infrastructure to accommodate the influx of intermittent renewable energy sources. Fitch will continue to monitor Taipower’s financial performance, regulatory developments, and the broader macroeconomic surroundings in Taiwan to assess any potential impact on its credit rating. the success of Taiwan’s energy transition and Taipower’s ability to manage its debt profile will be key factors in maintaining its ‘AAA(twn)’ rating in the future.