The Ministry of Economic Affairs (MOEA) yesterday said that it would propose freezing electricity prices for households during a rate review next month if the Legislative Yuan endorses a NT$100 billion (US$3.08 billion) fresh capital injection to keep Taiwan Power Co (Taipower, 台電) afloat.
The ministry proposed the capital injection as the state-run utility’s accumulated losses snowball and are predicted to reach NT$595.4 billion at the end of this year, surpassing the company’s paid-in capital of NT$481.5 billion.
Taipower blamed the losses on soaring global fuel costs.
Photo: Lin Yi-chang, Taipei Times
“Taipower and CPC Corp, Taiwan (台灣中油) are at risk of bankruptcy if their losses surpass the regulatory ceiling set by the Company Act (公司法),” Minister of Economic Affairs J.W. Kuo (郭智輝) told reporters.
If the legislature agrees with the proposed NT$100 billion capital injection, the ministry plans to freeze power rates for households, which account for about one-third of the nation’s power consumption, and would propose milder rate hikes for industrial users, especially for exporters, to reflect increases in power generation costs and avoid undermining competitiveness, he said.
Based on the ministry’s calculations, Taipower would see annual losses shrink to about NT$10 billion this year from an estimated NT$210 billion if the company receives financing aid from the government, power rate hikes are implemented and global fuel prices retreat.
In late March, the ministry’s Electricity Rate Review Committee, composed of government officials, experts and representatives from industrial groups, decided to raise electricity rates by 11 percent on average, beginning on April 1.
Heavy industrial users, mainly semiconductor companies and data center operators, saw power tariffs rise by up to 25 percent.
Kuo yesterday also urged the public to allow Taipower to build more power plants to facilitate the deployment of more data centers, or research and development centers, by the world’s major tech titans.
Artificial intelligence centers for training large language models consume enormous amounts of power and their power usage can only be expected to increase as the technology advances, Kuo said during an interview with SET News Channel on Sunday.
Apple Inc is seeking to set up its first data center in northern Taiwan, while AI chip suppliers Nvidia Corp and Advanced Micro Devices Inc are also looking at setting up such facilities in Taiwan.
In June, Amazon Web Services said it would invest billions of US dollars over the next 15 years to build data centers in Taiwan and create an infrastructure region in the country by early next year.
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