Thu, Dec 30, 2010 - Page 8 News List

Government needs to be direct over energy rates

By Hwang Jenn-jiang 黃鎮江

The Renewable Energy Development Act (再生能源發展條例) was put on hold for a long eight years before it was finally passed last year. One of the reasons for the long delay was the issue of “wholesale rates” on which the government and businesses could never come to an agreement. Unexpectedly, one year and three months after the act was passed, disagreements about rates are cropping up again.

The government is willing to violate agreements it has already made and lose the confidence of the public for the simple reason it does not have the courage to raise rates.

Nothing is ever for free. Each policy represents a promise. Nations around the world all have to make it clear where money is going to come from when they draw up renewable energy policies. As the organization responsible for enacting policies and purchasing power from the private sector, there is no way the Taiwan Power Co can absorb the tens of billions extra it will cost each year to obtain renewable energy and, judging from the content of the act, there are only two possible sources for this money. One possible source would be to increase the cost of electricity, while the second will involve the government allotting a certain amount of its budget to deal with the increased costs.

Households, shops and industrial users would be responsible for the first option. They would pay for what they use, which is in line with the fairness principle in that only the user pays. In the second scenario, everyone in Taiwan would be responsible for covering the costs, which is not only unfair, it would also make the government very worried about its finances collapsing.

When the government is worried about public discontent and does not have the nerve to increase the cost of electricity, which is the source of its revenue in this case, the only choice left is to handle things from the side of its own expenditure. In this case, the government would be dealing with renewable energy suppliers and this would involve hassling them to assure fixed prices for electricity. Regardless of what happens, the government at the very least must keep its actions in line with the principle of protecting trust. With the government’s house in such disorder, a debacle similar to that of the Fourth Nuclear Power Plant would cause the government to not only damage its image as the public loses faith because of a lack of sincerity, it would also greatly harm the future of Taiwan’s renewable energy industry.

The only way to solve these problems is for the government to stop pandering to public opinion to win voters over and instead take advantage of the recent uptick in the economy and tell our public the truth about electricity costs. It should tell our citizens exactly know how much of each watt of electricity it uses is sourced from renewable energy, as it costs more, and come up with reasonable increases in prices that people can afford. This is the price our public said it was willing to pay when it committed to slowing down climate change and protecting the earth. This is also why the government drew up renewable energy policies in the first place.

Hwang Jenn-jiang is a professor at National University of Tainan’s Department of Greenergy.

TRANSLATED BY DREW CAMERON

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