KMT legislator targets alleged Taipower cartel

POWER PLAY::KMT Legislator Lin Tsang-min urged a thorough government probe of the power company and its affiliates over possible improper collusion

By Sean Lin  /  Staff reporter

Sat, Jul 19, 2014 - Page 4

Chinese Nationalist Party (KMT) Legislator Lin Tsang-min (林滄敏) yesterday urged the Executive Yuan to investigate trade agreements between state-run Taiwan Power Co (Taipower) and nine privately owned electricity companies in the wake of a Fair Trade Commission (FTC) ruling earlier this month that demanded a NT$6.07 billion (US$200 million) fine from the companies in relation to alleged monopolistic practices and profiteering.

Of the nine firms probed, Sun Ba Co, Sing Yuan Trading Co and Star Energy Corp, subsidiaries of Taiwan Cogeneration Corp, are partially owned by Taipower, meaning the government holds a portion of their shares.

Lin told a press conference in Taipei that, by selling Taipower electricity at prices higher than the average price per kilowatt-hour (kWh), the privately owned companies have been able to make what the legislator described as “unscrupulous” profits, while Taipower posted a deficit, which in turn resulted in electricity price hikes for the general public.

Citing two rulings previously issued by the FTC that ordered the companies to pay fines totaling NT$6.32 billion and NT$6.05 billion, Lin called for better coordination between the FTC and the Executive Yuan.

The Executive Yuan ombudsmen ultimately rejected each earlier ruling. Lin demanded that the fines be imposed this time.

He also said that of the six other companies, Mai-liao Power Corp and Ho Ping Power Co, despite selling electricity at prices lower than the average price of NT$3.14 per kWh and respectively helping Taipower generate a revenue of NT$11.8 billion and NT$5.96 billion in an alleged monopoly, they bore the brunt of the fine imposed by the FTC, facing NT$1.81 billion and NT$1.32 billion respectively.

“This is clearly against the principle of proportionality,” Lin said, adding that it is “clear evidence” that the FTC has been patronizing Taipower-affiliated power companies.

In addition, he said that the 48 employees at the three smaller Taipower affiliates each received what he called “exorbitant annual bonuses,” averaging NT$2.45 million a year, which he said was another result of “profiteering.”

He called upon the Ministry of Economic Affairs, the Bureau of Energy and the Agency Against Corruption to conduct a thorough investigation of the “questionable trade agreements” leading to Taipower’s losses, adding that the Executive Yuan should “serve justice” by imposing the NT$6.07 billion fine, which would mean a 5 percent discount in electricity prices for all customers.

Saying that an electricity price increase would result in price hikes for “almost everything,” Lin added that Taipower and its affiliates should not “build their happiness on the suffering of the masses.”