Cabinet approves changes to Power Industry Law

The Cabinet yesterday passed the Ministry of Economic Affairs' (MOEA, 經濟部) draft revision to the Power Industry Law (電業法) that would ease restrictions on the creation of power companies, calls for the creation of an independent power distribution center, and legislates reductions in carbon dioxide emissions from electric generation plants.

A MOEA spokesperson said the revisions are in response to changes in Taiwan's overall economic structure, technological changes and the rise in local living standards.

Privatization and liberalization of the power industry are international trends and Taiwan is moving towards the full liberalization of the generation, transportation and marketing of electricity in order to meet the demands of future economic development, the spokesperson said.

At present the Taiwan Power Company (台電) is the sole electric generation agency for all of Taiwan.

The draft revision would allow more than one power company to operate in each geographical area. Companies would also be able to simultaneously handle the generation, transportation and marketing of electricity.

However, the draft revision stipulates that companies must set up independent accounting procedures for each of these three segments.

The draft also calls for the creation of an "independent and fair" power distribution center to ensure that all companies have equal access to the national power grid.

Under the draft guidelines, a certain ratio of power generated by electric companies must come from either natural gas or renewable energy sources, in order to reduce carbon dioxide emissions from power plants. If companies do not have their own plants to generate this type of "clean" electricity, then they will be allowed to purchase it from other operators.

The draft revision now goes to the Legislative Yuan for consideration.