Taipower rate hike violates resolution, DPP says

By Chris Wang  /  Staff reporter

Tue, Aug 27, 2013 - Page 3

State-owned Taiwan Power Co (Taipower) has violated a Legislative Yuan resolution by unilaterally announcing a price-raising scheme for next month without reporting to the legislature and carrying out necessary corporate reforms, Democratic Progressive Party (DPP) lawmakers said yesterday.

“The state-owned company should not raise electricity rates without carrying out corporate reforms first and resolving its perennial losses,” DPP Legislator Cheng Li-chiun (鄭麗君) told a press conference.

The scheduled electricity rate hike would be the third since President Ma Ying-jeou (馬英九) was re-elected in January last year.

While the policy has been unpopular, Premier Jiang Yi-huah (江宜樺) said last week that the scheduled electricity rate increase of an average of 9.64 percent is a “must-do.”

However, DPP legislators said that Taipower must instead review company policies that have caused heavy losses in recent years, among them producing unnecessary reserve capacity, the construction of the Fourth Nuclear Power Plant in Gongliao (貢寮), New Taipei City (新北市) and excessive subsidies to commercial clients.

Cheng said those measures had cost Taipower up to NT$519 billion (US$17.3 billion) in the past five years.

Taipower has violated a legislative resolution that required the company to report on its operations and required legislative approval for any rate hikes, DPP Legislator Chen Chi-mai (陳其邁) said.

In addition to the report, the company should also recognize that its losses have resulted from the company’s “systematic operational flaws” and possibly from corruption, Chen said.

The DPP caucus urged the government to carry out a comprehensive reform of the state-owned company and submitted a three-point recommendation that advised liberalization of the electricity market, the establishment of an independent electric power control and supervision center and different pricing scheme options for consumers.