By Ted Chen ,The China Post
TAIPEI, Taiwan — The National Audit Office (NAO, 審計處) yesterday announced that Taiwan’s seven state-operated enterprises accumulated losses of NT$106.7 billion in 2012.
Taipower, CPC Corp. (CPC) and Taiwan Railway Administration led in losses incurred, ending NT$62 billion, NT$33.8 billion and NT$9.7 billion in the red for 2012. The NAO said that it has urged CPC to formulate a strategy to improve its performance.
In total, Taiwan’s 26 state enterprise divisions generated revenue of over NT$3.57 trillion, with total operating costs of NT$3.39 trillion, and yielded NT$113.1 billion in net income. The profitability of state-operated enterprises exceeded the previously projected NT$113.1 billion by NT$64.8 billion, or 57.28 percent.
The NAO attributed the windfall to the central bank’s investment in foreign currencies and bonds, which yielded better-than-expected returns in 2012. The central bank and 19 other state-operated enterprise divisions generated profits of NT$293.9 billion.
CPC attributed its performance to its previous policy of absorbing half of fuel price hikes, which compelled it to realize inventory-related losses.
Currently, Taipower provides energy at NT$2.6 per kilowatt hour (kWh), at cost of NT$2.82 per kWh, representing a deficit of NT$0.22 per kWh, according to the company.
According to statistical records, Taiwan’s energy consumption in 2011 totaled at 198.6 billion kWh, representing unrealized costs of NT$43.7 billion at a per unit deficit of NT$0.22, an amount equivalent to 0.32 percent of 2011’s GDP of NT$13.7 trillion.
Meanwhile, the International Monetary Fund (IMF) said that Taiwan is excessively subsidizing its energy industry. Taipower rejected the claim, stating that it is unaware of the metrics used in the IMF’s assessment. It added that, due to policy constraints, it is often not able to reflect the actual cost of energy through its pricing. The company reported incurring additional costs of NT$24 billion in 2011, citing the fact that the company was compelled to absorb the energy costs of streetlamps, and maintenance of off-island power grid systems.
According to a recent IMF report, Taiwan’s subsidies to the energy industry are rated at 0.3 percent of national gross domestic product, which exceeds the average of 0.26 percent seen in developed economies.