Taipei, March 6 (CNA) Decommissioning Taiwan's three nuclear power plants will cost nearly double the initial estimates, but those extra costs will not lead to higher electricity prices, Economic Affairs Minister Lee Chih-kung (李世光) said Monday at a legislative hearing.
Lee was responding to a report that it would cost NT$620 billion (US$20.06 billion) to shut down the three nuclear power plants, process their nuclear waste and establish storage facilities, nearly double the NT$335.3 billion previously estimated by state-owned utility Taiwan Power Co. (Taipower), which operates Taiwan's nuclear power plants.
According to Taipower's latest estimates, NT$140 billion will be needed to phase out each of the three nuclear power plants, and building dry and consolidated storage facilities at the plant sites will push the overall total to NT$620 billion.
That represents a shortage of nearly NT$300 billion in the Nuclear Back-end Fund, which was set up to finance the cost of decommissioning Taiwan's nuclear power plants at the end of their life spans, the report said.
The Nuclear Back-end Fund, which currently has NT$320 billion, is financed by a contribution of NT$0.17 per kilowatt-hour of electricity generated by Taipower's nuclear power operations.
In response to concerns that the higher costs could be passed onto consumers, Lee said Taiwan generates about 230 billion kWh per year, and when the additional decommissioning costs are amortized over 10 years of power generation, the cost per kWh is extremely low.
Lee noted, however, that electricity prices are currently set by a formula that reflects international fuel prices and operating costs, and an increase in decommissioning costs could be factored into power costs.
A final determination will be made after accurate figures are submitted to the Bureau of Energy's Electricity Rate Review Committee and reviewed and then sent to the Executive Yuan for approval, Lee said.
Lee also said the government will devise measures to deal with the reduction in power generation after the three nuclear plants begin to be decommissioned between 2018 and 2025.
Vice Economics Affairs Minister Yang Wei-fuu (楊偉甫) said it will be Taipower's responsibility to handle the higher decommissioning costs, but he did not think the cost increase would affect electricity prices.
In addition, the Ministry of Economic Affairs said any electricity rate hike is unlikely before the Electricity Rate Review Committee convenes a meeting in October to determine the rate.
Taipower Chairman Chu Wen-chen (朱文成) agreed at the legislative hearing that decommissioning costs will be higher than originally projected, but he did not see them hitting an additional NT$285 billion, or NT$13,000 per capita, as the report said.
"The amount will not be that high. Further calculations are needed," Chu said.