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Economic Daily News: Electricity rate hikes should be postponed

2012/06/09 17:12:50

The first phase of electricity rate increases is scheduled to be implemented in Taiwan June 10.

We hope the government will postpone the hikes until October based on two reasons.

First, the hikes are intended to cover NT$100 billion in losses suffered by the Taiwan Power Co. as a result of rising global fuel prices. With international oil and coal prices falling since April, authorities should recalculate the hikes by taking into account the recent decrease in fuel prices.

Second, the upcoming hikes, which will coincide with the implementation of higher electricity rates for summer, will likely fuel inflation expectations. If the hikes are put off until Oct. 1, it will help minimize their impact on inflation.

We hope our government will adjust its plan soon to ease public complaints and alleviate inflationary pressure. This will allow the plan to be carried out more smoothly. (Editorial abstract -- June 9, 2012)

(By Y.F. Low)