Minister of Economic Affairs Kung Ming-hsin (龔明鑫) yesterday assured the public that the nation is not facing an imminent power shortage as supply of liquefied natural gas (LNG) remains sufficient and there is no need to increase coal-fired power generation in the short term.
Taiwan has secured 20 of the 22 LNG cargoes needed for this and next month, with the remaining two still under negotiation and expected to be secured soon, Kung said, urging the public not to worry.
A sufficient supply of LNG supply means coal-fired generation should operate as normal, he said, describing speculation that the nation could face a natural gas shortage as “impossible” and “simply rumors.”
Photo: CNA
Taiwan sources natural gas from different regions, with about one-third coming from Qatar and more than 60 to 70 percent from other countries.
The overall supply structure remains stable, Kung said.
Household gas consumption accounts for less than 5 percent of overall demand, making it unlikely that households would face shortages, such as a lack of hot water, Kung said.
With natural gas supplies stable, previously discussed contingency plans to increase electricity generation from coal-fired plants starting next month are unnecessary, he said.
The government will continue to monitor supply conditions after May, although global gas demand is expected to ease as temperatures rise, which should improve the situation, Kung said.
Alternative LNG procurement through the spot market could mean higher prices, but if deliveries are brought forward from existing contracts, pricing would be based on original contract terms, he said.
Whether domestic natural gas prices would be adjusted has yet to be decided, as the government’s priority is maintaining price stability, he said.
Rising energy prices and the impact of the Middle East conflict are challenges that countries across the world are facing — not just Taiwan, he added.
Such challenges could cause short-term volatility in stock markets, but long-term performance would still depend on economic fundamentals, he said.
Taiwan’s fundamentals remain strong, he said, citing annual growth of close to 70 percent in exports and about 60 percent increase in export orders in January.
Taiwan’s fuel pricing mechanism — including state-run CPC Corp, Taiwan’s (台灣中油) floating oil price formula, price-stabilization measures and the lowest-price principle among neighboring Asian economies — would continue to guide adjustments, the minister said.
The government will continue monitoring developments weekly and adjust policies as needed, he said.
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