CPC Corporation’s gas prices for power producers have increased for the second consecutive month amid continuing tensions in the Middle East. Taiwan Power Company (Taipower) estimates that starting in May, monthly costs will rise by NT$13 billion (US$406 million). Economic Minister Kung Ming-hsin (龔明鑫) said this Wednesday at the Legislature that both CPC and Taipower will need financial support from the government in the near future.

Although CPC has frozen residential gas prices, it has raised gas prices for industrial electricity users such as Taipower in both April and May. The minister acknowledged that Taipower is in a tough spot and that he has instructed the company to maximize revenue and reduce expenditures to weather the difficulties.

Kung said that electricity rates are determined by the Electricity Price Review Committee, with stable power supply and preventing Taipower from collapsing taking priority, followed by protecting livelihoods and stabilizing prices. The committee is scheduled to meet in September to determine new electricity rates for October.

Taipower Chair Tseng Wen-sheng (曾文生) said that although rising natural gas costs currently make electricity prices insufficient to cover expenses, the situation is exceptional and CPC may adjust prices later depending on how the situation develops. He added that if gas prices are not adjusted and energy prices do not decline, Taipower’s losses this year could exceed the NT$28 billion (US$875 million) projected in the budget.