Electricity rates would remain unchanged at NT$2.6253 per kilowatt-hour, the Ministry of Economic Affairs said yesterday.
The announcement followed a meeting of the ministry’s electricity price review committee.
Electricity rates have not been altered since September 2018 and would be maintained for the next six months until the committee’s next twice-yearly meeting, the ministry said.
Photo: Huang Pei-chun, Taipei Times
“Energy markets across the globe are currently seeing strong fluctuations and are prone to even bigger changes ... therefore the committee has decided to maintain current prices while it continues to observe raw material prices,” Deputy Minister of Economic Affairs Tseng Wen-sheng (曾文生) told a news conference in Taipei.
Tseng said that the recent drop in global crude oil prices, from US$60 earlier this year to under US$30 per barrel this week, was mainly a result of a conflict between oil exporters, and did not reflect market demand and supply.
Citing observations from committee members, Tseng said that oil prices would recover as soon as agreements are struck between major oil-producing nations.
Energy generation costs at state-run Taiwan Power Co (Taipower, 台電), the nation’s largest electricity provider, remain largely unchanged from last year, as coal prices have remained relatively stable, Tseng said.
Declining natural gas prices would not be factored in before June due to long-term contracts signed between international suppliers and CPC Corp, Taiwan (台灣中油), which is a major gas supplier to Taipower, he said.
“Nonetheless, any gains for Taipower [during the next six months] above the legal reserve of 3 percent would go to the energy price stabilization fund,” Tseng said.
The reserve of the fund — set up by the government to ameliorate the effects of short-term fluctuations in electricity prices on the economy — is expected to shrink to NT$10.8 billion (US$356.72 million) after the committee’s decision to allocate NT$32.7 billion to offset Taipower’s losses last year, the ministry said.
Taipower last year posted pretax losses of NT$14.7 billion due to low electricity rates.
However, the allocation is smaller than Taipower’s previous estimate of NT$41.2 billion.
Taipower yesterday posted pretax losses of NT$4.49 billion for the first two months of this year, which it attributed to higher costs associated with gas-fired plants, as well as alternative energy sources.
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