Trade groups and academics yesterday expressed dismay at state-owned Taiwan Power Co’s (Taipower, 台電) electricity rate hikes, saying the drastic rise would make conducting business in Taiwan difficult and put pressure on corporate profitability amid rising economic uncertainty.
Taipower on Monday said that it would raise electricity rates by an average of 8.4 percent starting on Friday. The hike is to reach 15 percent for large industrial users, to reflect soaring international energy prices.
Lin Por-fong (林伯豐), chairman of the Third Wednesday Club, a trade group whose membership is limited to the top 100 firms in individual business sectors, said the rate hike is beyond reasonable and has to do with the government’s rejection of cheaper nuclear power.
Photo: Liao Chen-hui, Taipei Times
Lin said he supported the government’s carbon-neutral policy, but suggested that it consider adding nuclear power to the nation’s energy mix to make electricity more affordable.
Matthew Miao (苗豐強), chairman of the Taipei-based Chinese National Federation of Industries, said that electricity fees play a key part in shaping Taiwan’s industrial development and authorities should approach the issue from a strategic standpoint.
Taiwan would have difficulty achieving its goal of becoming carbon neutral by excluding nuclear power, Miao said, adding that renewable energy sources would be inadequate to meet electricity needs to support economic growth in the coming years.
The General Chamber of Commerce said it welcomed Taipower’s decision to spare hard-hit sectors such as gyms, movie theaters, department stores and restaurants from the rate hikes, but called on policymakers to add hotels to the exemption list.
Hotels should not be deemed as heavy electricity users until after the government lifts COVID-19 border controls, chamber chairman Paul Hsu (許舒博) said.
Manufacturers of metal products and machinery equipment in central and southern Taiwan said given the sharp rate hikes, they have to pass on the extra costs to customers to stay profitable.
Taiwan Association of Machinery Industry chairman Larry Wei (魏燦文) said the 15 percent rise was “too much” and well above an anticipated 8 percent increase.
The hike would undoubtedly drive up manufacturing costs, Wei said, adding that industrywide protests against the price rises could not be ruled out.
Taiwan Machine Tool and Accessory Builders’ Association chairman Habor Hsu (許文憲) said that the adoption of a “user pays” principle alongside a reasonable adjustment of electricity rates would allow for more efficient utilization of energy resources.
However, Hsu said the government should be fair in its distribution of subsidies, and not favor certain industries at the expense of others, adding that the process by which electricity rates are calculated should be open and transparent.
He urged Taipower to improve its operational efficiency so as not to waste scarce resources, and that the government keep electricity prices relatively stable to avoid overburdening manufacturers and businesses.
Dachrahn Wu (吳大任), an economics professor at National Central University, said the hike should be introduced in stages to mitigate the pain on local firms.
The rate hikes stem from policymakers overestimating the strength of Taiwan’s economy in the second half of this year, Wu said.
Chiou Jiunn-rong (邱俊榮), another economics professor at National Central University, said the rate hike should be applied to all users, rather than being limited to heavy users.
Companies would make efforts to save on power consumption, but people unaffected by the rate hikes would not appreciate the importance of energy conservation, Chiou said.
Additional reporting by CNA
PATENTS: MediaTek Inc said it would not comment on ongoing legal cases, but does not expect the legal action by Huawei to affect its business operations Smartphone integrated chips designer MediaTek Inc (聯發科) on Friday said that a lawsuit filed by Chinese smartphone brand Huawei Technologies Co (華為) over alleged patent infringements would have little impact on its operations. In an announcement posted on the Taiwan Stock Exchange, MediaTek said that it would not comment on an ongoing legal case. However, the company said that Huawei’s legal action would have little impact on its operations. MediaTek’s statement came after China-based PRIP Research said on Thursday that Huawei filed a lawsuit with a Chinese district court claiming that MediaTek infringed on its patents. The infringement mentioned in the lawsuit likely involved
Taipei is today suspending work, classes and its US$2.4 trillion stock market as Typhoon Gaemi approaches Taiwan with strong winds and heavy rain. The nation is not conducting securities, currency or fixed income trading, statements from its stock and currency exchanges said. Authorities had yesterday issued a warning that the storm could affect people on land and canceled some ship crossings and domestic flights. Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) expects its local chipmaking fabs to maintain normal production, the company said in an e-mailed statement. The main chipmaker for Apple Inc and Nvidia Corp said it has activated routine typhoon alert
GROWTH: TSMC increased its projected revenue growth for this year to more than 25 percent, citing stronger-than-expected demand for AI devices and smartphones The Taiwan Institute of Economic Research (TIER, 台灣經濟研究院) yesterday raised its forecast for Taiwan’s GDP growth this year from 3.29 percent to 3.85 percent, as exports and private investment recovered faster than it predicted three months ago. The Taipei-based think tank also expects that Taiwan would see a 8.19 percent increase in exports this year, better than the 7.55 percent it projected in April, as US technology giants spent more money on artificial intelligence (AI) infrastructure and development. “There will be more AI servers going forward, but it remains to be seen if the momentum would extend to personal computers, smartphones and
Catastrophic computer outages caused by a software update from one company have once again exposed the dangers of global technological dependence on a handful of players, experts said on Friday. A flawed update sent out by the little-known security firm CrowdStrike Holdings Inc brought airlines, TV stations and myriad other aspects of daily life to a standstill. The outages affected companies or individuals that use CrowdStrike on the Microsoft Inc’s Windows platform. When they applied the update, the incompatible software crashed computers into a frozen state known as the “blue screen of death.” “Today CrowdStrike has become a household name, but not in