Increases in water and electricity rates next year will not heavily impact the nation's economy and consumer prices, economists said yesterday.
"The hikes will increase costs for manufacturers that use massive volumes of water and electricity to maintain their operations," said Wu Chung-shu (吳中書), a research fellow at Academia Sinica. "But the impact on consumer prices will be limited."
According to Wu, water only accounts for 0.004 percent of the consumer price index, and electricity makes up for 0.0225 percent of the CPI.
Minister of Economic Affairs Ho Mei-yueh (
Ho didn't specify how large the hikes will be. But she suggested a household of four might see a NT$150 per month rise in their electricity bills after the adjustment.
This translates into about a 15 percent increase, applying the average household's monthly power consumption of 375 kilowatt-hours, as a calculation base.
Academia Sinica predicts the electricity fee increase will be only about 9 percent, Wu said.
Chou Yi-yueh (
The ministry still needs to obtain approval from the Cabinet before finalizing the scheme.
As for water rates, Ho said the increase will be higher than for electricity fees, as current rates have been fixed for 10 years and barely reflect costs.
Joses Wu (
The proposal needs to be reviewed and passed by the legislature, which will begin a new session in February, Wu said.
As the proposed price increases have drawn criticism from the public and among various industries, Premier Yu Shyi-kun stressed yesterday that they will not be implemented before the Cabinet reshuffle.
Chu Yun-peng (
"Besides, oil prices are expected to fall next year, which will help lower the consumer price index," Chu said.
Chou Ji (