Taipower’s gas bills to rise after CPC LNG hike

Natural gas bills for Taiwan Power Co (Taipower, 台電) are to rise this month after CPC Corp, Taiwan (台灣中油) yesterday raised prices of natural gas for power generation as efforts to restart diplomatic negotiations between the US and Iran face resistance.

CPC is hiking liquefied natural gas (LNG) prices for power generators by 9.68 percent this month to NT$24.9096 (US$0.782) per cubic meter, the state-run company said in a statement.

LNG prices that CPC charges for power generators have doubled since the start of the US-led war on Iran in late February, after raising prices by 53.92 percent from March to May and adding another 25.42 percent from August to last month.

Photo courtesy of CPC Corp, Taiwan via CNA

About 80 percent of imported LNG is used for power generation, the company said.

“With US-Iran negotiations stalled again, uncertainty surrounding Middle East LNG supply remains high. Coupled with European countries continuing to stockpile gas for winter, international LNG prices have continued to rise, increasing the cost of imported gas,” CPC said.

The company yesterday kept gas prices for households, the service sector and industrial users unchanged this month to help stabilize overall consumer prices and ease pressure on families and small businesses, it said.

In the first eight months of this year, CPC’s pretax losses totaled NT$8.5 billion and cumulative losses reached NT$89.5 billion as the company continues to follow the government’s instructions to absorb fuel cost increases and stabilize energy prices, company data showed.

The LNG price hikes would add pressure on Taipower, which yesterday reported a pretax loss of NT$20.3 billion for the first eight months due to high fuel costs, even though it charged higher electricity rates for residential and commercial users in the summer months.

The state utility’s accumulated losses stood at NT$371.2 billion at the end of August, it said.

The Executive Yuan has budgeted a subsidy of NT$71.1 billion for Taipower and plans to infuse NT$233.8 billion to CPC, if approved by the legislature, to help ease the two companies’ financial pressure.