State-run Taiwan Power Co (Taipower, 台電) said first-half oil consumption was 33 percent below forecast because demand for electricity was less than expected.
The company used 1.23 million kiloliters (7.7 million barrels) of oil in the first six months of the year, compared with its prediction of 1.83 million, Taipower's chief engineer Tu Yueh-yuan (杜悅元) said by telephone yesterday.
Electricity demand increased 2.9 percent in the January-June period from a year earlier, trailing Taipower's forecast of 4.8 percent for the full year, Tu said.
Growth in power consumption slowed as companies moved production overseas to cut costs.
"We used less of our oil-fired units as power demand wasn't as big as expected," Tu said.
Oil-fueled generators accounted for 5.6 percent of the electricity output in May, compared with installed capacity of 9.6 percent, Taipower's Web site showed.
Coal-fired units accounted for 43 percent of the electricity output in May, compared with 23 percent by natural gas-fueled generators and 18 percent by nuclear reactors, the Web site showed.
Tu said it costs NT$3.64 to generate a kilowatt-hour of electricity burning fuel oil, more than double Taipower's average generation cost.
Separately, Taipower cut planned coal purchases by 39 percent after the price of the fuel climbed to a record, the director of Taipower's fuel department said.
Taipower bought 1.19 million tonnes of Indonesian coal, compared with 1.96 million tonnes it had sought in a tender, he said.
He said the company may issue another tender, although he did not give a date.
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