Taiwan Cogeneration Corp (台汽電) said yesterday that the company would instruct four independent power producers (IPPs) under its purview to renegotiate the terms of electricity purchase contracts with state-run Taiwan Power Co (Taipower, 台電).
The company said in a statement to the stock exchange that its board had made the decision after its four IPP subsidiaries failed to reach an agreement with Taipower to adjust the terms of their contracts in September.
Taiwan Cogeneration is a Taipower subsidiary. The four IPPs are Kuo Kuang Power Co (國光), Star Energy Corp (星能), Sun Ba Power Corp (森霸) and Hsing Yuan Power Corp (星元).
Since the last round of negotiations broke down, the state-run utility filed lawsuits against the IPPs on Oct. 11.
The legislature’s Economics Committee on Oct. 11 slashed NT$9.5 billion (US$326 million) from a budget of NT$142.68 billion that Taipower was allocated for purchasing electricity from businesses using cogeneration systems and from IPPs next year.
According to a draft proposal that Taiwan Cogeneration prepared for negotiations with Taipower, the proposal would help save the state utility about NT$907 million a year in electricity purchase from the four IPPs, the Central News Agency yesterday quoted Taipower spokesman Roger Lee (李鴻洲) as saying.
Taiwan Cogeneration said the new proposal would need approval from the IPPs’ boards.
The company holds 35 percent stakes in Star Energy, 32.5 percent in Sun Ba, 33.67 percent in Hsing Yuan and 35 percent in Kuo Kuang.