Taiwan’s chipmakers will be hit by a big power bill in January.

Taiwan froze electricity rates in September, despite Taipower calling for a 12.83% increase to cover rising fuel costs. The government will review rates again in December, with any increase taking effect on 1 January 2027. Taipower’s fuel bill is up NT$160 billion (US$4.9 billion) this year, adding an expected NT$70 billion to its accumulated losses. Heavy users are the obvious next source of cash, TSMC is particularly exposed. Its Taiwan factories consumed 9.2% of the island’s electricity in 2025. A 12.83% tariff increase would cost TSMC roughly US$370 million a year, while a 25% increase, similar to 2024, would cost US$750 million. The 2024 increase cut TSMC’s gross margin by 0.7–0.8 percentage points in one quarter. TSMC could therefore cover roughly a tenth of Taipower’s additional fuel costs. Smaller chipmakers such as UMC and Vanguard would face a greater hit to their profit margins, but TSMC would bear the largest bill.