Taiwan Power Co (Taipower, 台電) repeated yesterday its almost annual threat of possible increases in power prices, saying revenue targets for 2001 would be unattainable due to high oil prices and losses resulting from halted construction on the Fourth Nuclear Power Plant (核四).
Taipower Chairman Hsi Shih-chi (
Taipower's revenue estimates for this year will be the lowest in six years, Hsi said, blaming the poor performance on high oil prices, which have meant higher operating costs for both Taipower's plants and those of independent power producers.
The independent producers must sign 25-year power purchase agreements with state-run Taipower, who while selling power to end users at fixed prices must buy the power at a rate determined by the cost of fuel.
"Due to the rigid pricing system, Taipower is unable to pass on its increased costs to consumers," one analyst said.
Another major factor behind possible price hikes cited by Hsi was the around NT$3.48 billion in losses from the 101-day suspension of construction of the Fourth Nuclear Power Plant.
Taipower has threatened for years that prices would have to be raised due to mounting costs but strong opposition in the legislature to any power price hike has kept average prices fixed.
Taipower has not raised prices in 18 years, and according to one analyst, isn't likely to do so this year.
"The legislature will hold elections at the end of the year, which means no lawmaker is going to want to see prices rise," said the analyst who requested anonymity.
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