25% Electric Price Hike Could Come for Small Users

TaiwanPlus News

State-run power company Taipower is struggling with years of losses. And while it has no concrete plans, there's talk of a 25% price hike on small users if a hefty subsidy doesn't come through.

Transcript

00:00At Mr. Hsieh's small Taipei eatery, there's a bit of worry in the air.

00:06Mr. Hsieh is already squeezed by rent and gas bills, and now there's talk small businesses

00:10like his could see power bills jump 25 percent overnight.

00:15State-run electric company Taipower is in bad financial shape, with losses of over a

00:20billion U.S. dollars over the past three years.

00:24The money to keep the power flowing needs to come from somewhere.

00:27And while price hikes for bigger industrial users have so far been a focus of attention,

00:31smaller customers, those who use less than 330 kilowatt-hours, could soon be hit hard

00:37too.

00:38At a time of rising living costs, including power price hikes last year, this is worrying

00:43for Mr. Hsieh.

00:44It's very expensive.

00:45Yes, it's very expensive.

00:46For example, my electricity bill is $7,000 in the summer, and $3,000 in the winter.

00:47In the summer, they've already increased our price because we can't lower it.

00:56So far, Taipower says it has no definite plans, but it needs to find a lot of funding fast.

01:02It would take an injection of 1.5 billion U.S. dollars this year alone to break even.

01:08The key is an upcoming meeting of the board at the economy ministry that sets electricity

01:13rates, and whether it agrees to subsidize small users' power bills this year.

01:18It's a lot cheaper now than it was at 330 kilowatt-hours, so it's all up to the business

01:26committee to decide whether to subsidize or not.

01:28If the idea of a rate hike for small users does go ahead, 13.5 million households will

01:34face higher bills, not to mention small businesses.

01:37But without the cash the company needs, economists say service could suffer.

01:43Some suggest a gradual price hike as a solution.

01:46If you want to subsidize small users, it's reasonable to lower the price, but you shouldn't

01:52make the company lose money.

01:55I think it's a good idea to slow down the price hike so that the company doesn't lose money.

02:02It could take time before the government has an answer.

02:06This has been a year of heated political arguments over government spending.

02:10And with no word on what its budget for this year might look like, Taipower is in limbo,

02:15with little to go on when it comes to planning pricing for the coming months.

02:19Eason Chen and John Van Triest for Taiwan Plus.

Category

Transcript

Recommended