Taiwan Power Company 1 Taipower Coal Demand and Procurement Plan Presented by Edward K. M. Chen Director of Fuel Department Taiwan Power Company At The 8 TH Meeting of R.O.C. / Australia Joint Energy and Minerals Trades Taipei, August 2000

Taiwan Power Company 2 Contents 1. Introduction 2. Coal Demand Coal-fired Units Consumption Forecast Power Plant Characteristics & Environmental Restrictions Coal Quality Comparison 3. Procurement Plan Taipower Policy Procurement Methods Procurement Plan for Year Taipower and Australian Coal Industry Status of Current Contracts Bengalla JV

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4 Total : 29,634MWTotal : 46,891MW

Taiwan Power Company 5 Total : 156,511GwhTotal : 236,880Gwh

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9 Environmental Restrictions and Coal Usage For Taipower Coal-fired Power Plants

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Taiwan Power Company 12 Procurement Plan Taipower Policy:  Diversification  Direct Contacts for Term Contract Supply  Adequate Level of Participation in the Spot Market  Strict Quality Requirements

Taiwan Power Company 13 Procurement Methods  Term Contract (1) 70% Min. of Total Requirements (2) Selective Tendering (3) Uniform Upper Percentage Limit for All Regions Except Chinese Mainland  Spot Purchase (1) 30% Max. of Total Requirements (2) Open Tendering  Both Term Contract Procurement and Spot Purchases Are Carried Out on An International Bid Basis.

Taiwan Power Company 14 Procurement Plan for Year 2002  The uniform upper percentage limit of 35% is proposed subject to final approval by Taipower board of directors.  85% of total requirements are allocated for nominal tonnage to be covered by term contracts.  4-5 term contract tenders are expected to be issued in Q  Spot purchase tenders will be issued roughly on a quarterly basis.

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