Taiwan’s five-hour blackout costs 151 companies US$3 million

Outage caused by ‘structural problems’, power company says as it promises to improve oversight of operations

PUBLISHED : Thursday, 17 August, 2017, 4:57pm
UPDATED : Thursday, 17 August, 2017, 10:13pm

Taiwan’s massive power outage on Tuesday caused almost US$3 million worth of losses for 151 companies in trading estates and export processing zones on the island, the economics ministry said on Thursday.

The government plans to release a figure for the overall economic cost of the blackout in the next few days, a ministry spokesman said.

The five-hour long blackout caused estimated losses of NT$87.47 million (US$2.88 million) and affected millions of homes as well as offices and companies. The outage prompted an apology from President Tsai Ing-wen.

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Advanced Semiconductor Engineering said the power outage cost it between US$500,000 and US$800,000 based on preliminary estimates.

However, the company does not expect the losses to have an impact on its August revenues as it plans to undergo overtime work to compensate, a company spokesman said.

The blackout was caused by “structural problems” and human error involving the replacement of equipment at state-owned gas supplier CPC Corp, which ultimately affected the operations of a power plant owned by state-run Taiwan Power Co, CPC Corp said.

The misstep caused six generators at the plant to stop working.

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The Ministry of Economic Affairs and Taiwan Power said in separate statements late on Wednesday that 5.92 million homes were affected by the outage and that the power company would offer electricity fee deductions totalling NT$360 million. Once approved by the ministry, the deductions would be made in the next round of electricity bills.

Government officials said a task force would be set up to investigate the cause of the outage.

Taiwan Power Vice-President Lan Hung Wei said in an interview that the company was making improvements to its oversight of operations.

“For this incident, I think it’s a problem of implementing the work standard operational procedure ... The engineering and site operational management needs to be improved. We will work to improve these areas,” Lan said.

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Taiwan Power also hopes the government’s green energy policies and the company’s complementary green energy measures could partially help resolve Taiwan’s otherwise chronic electricity supply shortages, Lan said.

Taiwanese companies have long complained of shortages in water and electricity supply that affect their operations.

Leading technology companies on the industrialised island nevertheless reported little impact from the outage this week.

While Advanced reported some potential costs, Taiwan Semiconductor Manufacturing Company said its operations were not affected, as did electronics manufacturer Pegatron Corp.