Tue, May 09, 2006 - Page 12 News List

Taipower confirms price hike request

BLOOMBERG

Taiwan Power Co (Taipower, 台電), the nation's only electricity retailer, is seeking government approval for the state-run utility's first price increase in 23 years to counter surging fuel costs.

The state-run company last week submitted a proposal to the government to raise tariffs for industrial users, said Lee Chuan-lai (李傳來), a Taipower spokesman. The Cabinet will have the final say on the increase, the timing and size of which haven't been decided, he said.

Taipower's net income plummeted 73 percent NT$1.94 billion (US$62 million) last year as the cost of fuels climbed. Falling profit is prompting the utility to sell more bonds to help fund investment in power plants and power-lines.

"A portion of industrial users will face price changes," Lee said in a telephone phone interview from Taipei yesterday.

Prices for households will probably stay unchanged "to narrow the gap" in costs between the two groups of customers, he said.

Taipower gives factories preferential rates to aid the nation's economic development. Industrial users pay an average NT$1.7 a kilowatt-hour, compared with NT$2.4 for households and the average of NT$2.05 for all of Taiwan.

Residential users account for about 35 percent of the nation's electricity consumption, while industrial and commercial clients the rest, according to Lee.

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