The initial phase of the network totals 9.6km and comprises the Green Mountain Line, which will link Hongshulin station on the Taipei Metro Tamsui Line to Danhai New Township with 11 stations, and a three-station branch to Danshui Fisherman's Wharf, which will be known as the Blue Ocean Line. The $NT 12.8bn ($US 413m) project is due to be completed in 2018.

Phase 1 will be built by China Steel Corporation and its subsidiaries United Steel and Engineering Corporation and Taiwan Rolling Stock Company (TRSC).

Services will be operated by a fleet of 15 bidirectional 34.5m-long five-section LRVs, which have been developed for TRSC by Voith Engineering Services at its Competence Centre for Rail Vehicle Development in Chemnitz, Germany. A pre-series vehicle will be delivered at the end of next year and production will begin on the remainder of the fleet in 2017.

A second phase totalling 4.4km is also expected to open by 2023, and the network will have capacity for around 120,000 passengers per day.

Danhai is growing rapidly and its population is expected to increase from around 16,000 to as much as 340,000 by 2041.