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Gov't to launch electricity

TAIPEI, Taiwan -- A new wave of electricity price hikes will kick in this October as scheduled, Economics Minister Chang Chia-chu said yesterday, during an interpellation session at the Legislative Yuan.

According to the minister, the scale of the increases will be determined by the economic climate, while industry experts, on the other hand, said that they expect a 10-percent hike.

"The increases will take effect in October. (The ministry) does not want the public to have false expectations," said Chang.

The minister said that the measure is meant to help increase the competitiveness of local industries and encourage them to reduce power consumption by becoming more energy efficient.

In response to concerns over the price hike's impact on the economy, Chang said that Taiwan's GDP is affected by several factors, and that the MOEA will not consider scrapping its plan unless the economy gets "really bad" in the second half.

The minister added that current government subsidies to large electricity consumers are not conducive toward energy conservation and carbon reduction.

Nuclear Dispute

Given the uncertainty over the fate of the island's Fourth Nuclear Power Plant and the pending decommissioning of the nation's three active nuclear plants, a power shortage and subsequent price hikes are inevitable, according to Chang.

Some critics, however, have argued that the MOEA's statement regarding an inevitable power shortage is a blatant lie, due to the fact that the three active nuclear plants account for an installed capacity of roughly 12 percent, while the Fourth Nuclear Power Plant will account for 6 percent of total power generation, if it becomes operational.

Moreover, Chang's claim that nuclear power is the cheapest energy available has been repudiated by several energy experts.

The cost of nuclear waste disposal is not included in the government's calculations, said Chen Mo-shing, former professor and director of the Energy Systems Research Center at the University of Texas, adding that electricity generated with alternative energy sources will be cheaper than nuclear energy

James Kuo, former principal engineer at American Electric Power, previously proposed a plan to convert the Fourth Nuclear Power Plant into a natural-gas fired facility, adding that the conversion would be cheaper than continuing the facility's construction as a nuclear plant.

Liberalization of Power Industry

The MOEA plans to increase Taiwan Power Company's competitive edge by ending its monopoly, an official said yesterday.

Water and nuclear power generation, however, will not be included in the deregulated areas, the official added.

With the approval of the Legislative Yuan, independent power producers will be allowed to sign contracts with electricity consumers for power supply, said the MOEA.

The ministry plans to complete its amendment of the Electricity Act and submit a draft to the Legislative Yuan for review in August.

The amendment is expected to be passed by the Legislature, given that the opposition party has expressed support, the official said.

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