Taiwan OKs electricity rate increase

Source： Taiwan Today
By Meg Chang
Electricity rates will increase in Taiwan from May 15 as part of ROC government efforts to ensure sustainable development of the island’s economy.

Minister of Economic Affairs Shih Yen-shiang said April 12 that the adjustments are necessary to bring prices back to reasonable levels more in line with those being charged in other parts of the Asia-Pacific region.

“The days of cheap electricity are over and Taiwan must face up to this hard fact,” he said.

According to Shih, surging international charges for coal, natural gas and crude oil have driven up state-owned Taiwan Power Co.’s per kilowatt hour production costs to NT$2.82 (US$0.10). The utility currently bills an average of NT$2.60, resulting in annual operating losses of NT$43.7 billion.

The change, which is forecast to bring Taipower’s 2012 pretax losses down 87 percent to NT$15.2 billion, will also boost carbon reductions, promote energy-efficient sectors and ensure public well-being, he said.

Under the new pricing model, 27 percent of households will see no difference in their monthly bills, while nearly 40 percent are set for a maximum average increase of 10 percent, or NT$105. Those who consume more than 620 kilowatt hours a month will pay at least 19 percent more.

Tariffs for commercial and industrial users will rise 16 percent to 33 percent and 29.5 percent to 37.3 percent, respectively.

Projections released by the Ministry of Economic Affairs indicate that the new rates will load average production costs for Taiwan’s manufacturing sector by 0.48 percent and add 0.33 percent to household spending.

But even with the adjustments, Taiwan’s electricity prices are still lower than those found in Hong Kong, Japan and Singapore, the MOEA said. (JSM)

Write to Meg Chang at meg.chang@mail.gio.gov.tw