Looking back in 2010, although Taipower confronted challenges, encountered hardships and endured adversity, there were also some impressive achievements. Taipower suffered a deficit in its pre-tax revenue of NT$18.7 billion for the year, greater than the previous year’s loss of NT$1.37 billion. The major reasons were economic recovery and rising fuel prices. The tight supply-demand situation in the international fuel market led to the continuous hiking of prices. The supply shortage in coal spot markets in the Asia-Pacific region pushed coal prices close to US$130 per ton at the end of 2010. In addition, the price of crude oil also soared to US$94 per barrel. It is expected that the prices will keep rising in the future. In consideration of the nation’s overall economy and people’s livelihood, the government elects not to increase electricity tariffs. With the large increase of fuel costs, it was inevitable that the company's deficit expanded. Despite the difficulties in external management, the company continued to meet its goals of providing reliable power and increasing power development in Taiwan thanks to Taipower’s dedicated employees making every effort in the tasks of “expanding income sources and reducing expenditures” and actively upgrading management performance.

In 2010, with the concerted efforts of all the employees, the major outstanding achievements were:

• The energy production and sales reached 207.4 and 193.3 billion KWh, a 7.1% and 7.9% increase over the previous year, respectively; the energy sales per employee was 8,548 MWh, a 6.5% increase over the previous year.

• The six nuclear power units, which bear the important responsibility for base load, generated in total 40 billion KWh over the whole year, the highest record in Taipower’s history. This marked the fourth year in a row for setting a new record for nuclear power generation and posed a remarkable contribution in terms of CO 2 emission reduction. In addition, no scram incidents occurred, setting another new record in Taipower’s history of nuclear operation.

• The duration of continuous operation of thermal power units kept breaking records. The heat efficiency reached 42.52% (LHV, gross), of which, coal-fired steam units made up 39.78% and gas-fired combined-cycle units made up 50.03%.

• For transmission and distribution, power supply stability and reliability also performed well. The SAIDI (System Average Interruption Duration Index) was reduced to 17.663 min./customer．year and the SAIFI (System Average Interruption Frequency Index ) was reduced to 0.196 freq./customer．year, both setting new records for Taipower. The line loss was reduced to 4.66%, making the second best figure in Taipower’s history.

• For construction management and innovation, Taipower received three awards in the “10th Public Construction Golden Awards” held by the ROC Public Construction Commission: two in the civil engineering category and one in the facilities category. In addition, Taipower was awarded recognition in the “2010 Asian Power Awards”, the 6th year of Asian Power’s annual awards event held by Asian Power magazine in Singapore: a gold medal for the “Best Asian Transmission and Distribution Project of the Year” and a gold medal for the “Best Operation and Maintenance Project”. Taipower’s efforts won recognition both at home and abroad.

Presently, in addition to its weakened financial strength, and its insufficient base load energy, the company is facing rising global material and fossil fuel prices, the demand for CO 2 emission reduction, etc., that lead to vast uncertainties and ever-increasing challenges. To meet the requirements for long-term development, Taipower will continue to overcome difficulties with diligence and pragmatism to reach the company’s management goals. The measures that the company is in the process of enacting include efforts to:

• Continue implementing the plan of “expanding sources of income and reducing expenditures”to upgrade the company’s productivity so as to enhance the company’s financial strength. In accordance with market principles, timely adjustments in financial strategies will be made to cut down funding costs and interest payments. Timely efforts will be also made to strive for the establishment of a power price adjustment mechanism to reflect actual costs for improving company financial conditions.

• Continue promoting ①large-scale base load generation projects, with the goal of ensuring nuclear safety by completing the construction of the Lungmen Nuclear Power Project as well as the retrofit projects of the Linkou, the Shenao, and the Talin Thermal Power Plants and completing ②the Tungsiao Thermal Power Plant Retrofit Project to serve for mid and peak load requirements. The above projects serve to increase the percentage of base load energy, raise generation efficiency, and supply sufficient electricity and reserve margins to meet the needs of people’s livelihoods and promote further industrial and commercial development.

• Continue promoting the Seventh Transmission and Substation Project and the Sixth Distribution Project to strengthen the power grid for upgrading power supply safety and efficiency. The facilities of a smart power grid will also be prudently constructed to integrate renewable energy into the power system and to increase power consumption efficiency.

• Comply with the government’s promotion of a low-carbon economy and striving to reach national energy conservation and carbon reduction goals, Taipower began an “Energy Conservation and Carbon Reduction Promotion Report Meeting” to annually review the company’s overall goals, control strategies and action plans for energy conservation and carbon reduction through facets of power supply-side, power demand- side and environmental protection. The company will continue the development and purchase of renewable energy, such as hydro power, wind power and solar energy.

• Strengthen nuclear safety, Taipower is undergoing a comprehensive safety review on the existing First, Second, and Third Nuclear Power Plants and the Fourth Nuclear Power Plant under construction in terms of earthquake and tsunami resistance and the mechanical and electrical systems. In addition, eight reinforcement measures are in the process of being addressed for the safety of nuclear power plants in order to eliminate the public’s anxiety about the nuclear disasters caused by the massive earthquake and tsunami in Japan.

• Follow through on its promises to provide social care, the company has outlined its long-term social investment plan covering different aspects such as hardware construction, donations, and corporate volunteers, etc. In the meantime, the company has been making efforts to upgrade its non-financial value in society and the environment through promoting social charity, education, culture, and environmental protection activities, etc. All these efforts are being undertaken to pursue the company’s vision to co-exist and co-prosper with society.

On the eve of celebrating the 100 th anniversary of the founding of the Republic of China, it’s also time for reflection on the past. As a leader of the operation of the power industry in Taiwan, facing swift changes in an uncertain era, Taipower will remain vigilant while planning the future development of the power industry in Taiwan. The company will continue to provide customers with more value-added services and features along with safer, more reliable and sustainable power.