Taiwan’s electricity supply has been under long-term strain, with last year’s power restriction crisis still fresh in the minds of the public. Today, Cabinet spokesperson Hsu Kuo-yung held a press conference to address the growing concerns about a potential shortage this summer.
Hsu claimed that the current situation is due to the delayed plum rains and an early arrival of hot weather. However, he pointed out that the operating reserve margin is currently above 11%, compared to 7.2% last year, so wide-scale power cuts are “unlikely.”
To manage the risk and protect the government’s credibility, the administration is launching a mandatory electricity saving program for large users. This targets approximately 3,500 industrial and commercial users with contracted capacities over 1,000 kW. When the grid hits a “red light” alert (reserve capacity below 900,000 kW), these users will be forced to reduce usage by 5%.
- Incentives: Users who meet or exceed the target will receive a 20% discount on their basic electricity fee for the saved portion.
- Penalties: Those who fail to meet the target will face a 40% surcharge on their basic electricity fee.
This “demand management” is seen by the business community as a sign of a failing energy policy. When a government has to resort to punishing large users to keep the lights on, the stability of Taiwan’s industrial environment is called into question.