TAIPEI (Taiwan News) — Taiwan may need to raise electricity prices by 13% if an agreement cannot be reached on a subsidy for Taiwan Power Company (Taipower).
The Ministry of Economic Affairs (MOEA) electricity price review committee will discuss whether to raise electricity prices in October. According to insiders, Taipower will present two versions for discussion at this week’s meeting.
The first version is a NT$100 billion (US$3.12 billion) subsidy. The second will see electricity prices rise by 13% for the company to break even, per China Times.
The central government plans to allocate the subsidy to Taipower to restore its financial health within two years, reducing the burden of excessive policy subsidies and returning oversight to the competent authority. This would also help stabilize newly developed power sources.
Taipower previously indicated that if the budget allocation is not approved, a price hike may be necessary. Kuomintang (KMT) caucus leader Lin Szu-ming (林思銘) also questioned whether the subsidy would eliminate the need for a price increase.
Economics Minister Kuo Jyh-Huei (郭智輝) said on Friday (Sept. 20) that the subsidy is intended to improve Taipower's financial situation and has no direct correlation with electricity prices, per ETtoday. Whether prices will increase will be up to the committee's review, but Kuo said prices will likely not need to rise.
Premier Cho Jung-tai (卓榮泰) also emphasized that electricity prices are not solely for residential use, and residential rates were already adjusted once in April. Considering the need for stability in daily life, Cho said prices should not increase further, but the decision will be left to the committee.