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Cabinet passes bill to okay alternative power generators

The Cabinet yesterday passed draft amendments to legislation which, if approved by the Legislature, will broaden the base of electricity generation in Taiwan and increase capital for the funding of energy research and development.

Draft amendments to the Energy Management Law (能源管理法) encourages private firms to set up efficient steam-driven co-generation units that comply to government-approved standards and can sell the excess power to local integrated power companies, according to a Cabinet statement.

At present Taiwan has only one integrated power company -- the state-owned Taiwan Power Co (Taipower, 台電) -- which not only produces power but also distributes it. Government spokesman Su Tseng-ping (蘇正平), who announced the amendments, said that unless Taipower can provide a good reason why it shouldn't purchase power from a privately-owned co-generation unit, then it will be required to do so.

By broadening the power production base the government is hoping to stabilize the nation's electricity supply which maintains a reserve ration margin of around 12 percent. Taipower officials admit that an ideal margin would be between 15 to 20 percent.

Companies to benefit from this law will surely be the Formosa Plastics Group (台塑集團) which already has two 60 megawatt co-generating units up and running at its Mailiao petrochemical complex in Yunlin County, with plans for building another five.

In keeping with the government's aim of diversifying its energy sources, the amendments also establish a legal framework for broadening the source of funds of an energy research and development fund, according to the statement. The amendment stipulates that integrated power companies, oil refiners and firms in the oil transportation business will be required to contribute 0.5 percent of revenue earned from their energy-related business to the fund every year.
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