Tue, Oct 28, 2008 - Page 3 News List

MOEA: price may fall for LPG, but not electricity

By Jerry Lin  /  STAFF REPORTER

Minister of Economic Affairs (MOEA) Yiin Chii-ming (尹啟銘) said yesterday that there would be no reduction in electricity and liquefied natural gas (LNG) prices, but liquefied petroleum gas (LPG) prices have room to drop.

Yiin spoke at a meeting of the legislature’s Economics Committee in response to questions from Democratic Progressive Party (DPP) legislators, who wanted to know why the decline in international commodity prices had not been reflected in domestic natural gas and electricity prices.

DPP Legislator Lee Chun-yee (李俊毅) said the domestic LPG price had not fallen since prices were raised in May and asked Yiin whether the price of LPG was likely to fall given that international LPG prices have dropped 40 percent.

Yiin said the international LPG price had only dropped by US$57 per tonne from US$857 on May 28 to US$800 on Oct. 2, while the domestic price was cut by NT$0.5 per kilogram on Sept. 2 and then again on Oct. 2.

Yiin said there was room for the price of domestic LPG to fall. However, the amount of the price cut would have to wait until [the state-owned oil refiner] CPC Corp, Taiwan makes its announcement on Saturday.

DPP caucus deputy whip Pan Meng-an (潘孟安) asked Yiin if electricity rates might be reduced since international coal prices had fallen almost US$90 per tonne from a high of US$194.79 per tonne at the end of June.

Yiin said his ministry’s data showed that coking coal prices had risen from NT$2,280 per tonne on July 1 to NT$3,938 this month.

Taiwan Power raised electricity rates only about one-fourth of what was needed on July 1 and Oct. 1, he said, therefore it would be extremely difficult to lower rates. The same held true for the price of LNG, he said.

At a press conference after the meeting, Pan said: “We asked the ministry to reduce oil, gas and electricity prices as soon as possible” to reduce the economic pressure on the public during a recession.

Pan said the caucus had asked Yiin to come up with price reduction measures and present them during tomorrow’s Economics Committee meeting.

If Yiin refused to do so, the DPP caucus would boycott the ministry’s budget, Pan said.

Pan said the Cabinet’s price stability task force must also come up with measures to respond the drops in crude oil and commodity prices.

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