Hong Kong
(HK Electric)
Macau
New York
Sydney
London
Average yearly outage (minute)
Tariff comparison per kWh (HKD)
*Excluding outage due to stoppage and power supply limits by the Mainland
Sphere
#35
2014
21
Like many countries around the
world, Hong Kong is considering
what fuel mix meets its energy needs
and community aspirations. Price,
reliability, air quality, autonomy,
carbon footprint and much more
bear on the complex considerations
involved in committing countries,
provinces, states and cities to long-
term fuel solutions.
The Hong Kong government is
consulting public opinion. InMay,
Mr Canning Fok, Chairman of Power
Assets, made his views known.
Choices
Members of the public have been
presented with two options:
Option 1: Purchase 30 per cent
electricity fromneighbouring China
Southern Power Grid (CSG); or
Option2:Generate60percentelectricity
fromnatural gas in Hong Kong.
At the Power Assets shareholder
meeting, Mr Fok presented a case for
strongly supporting Option 2. Hong
Kong’s biggest concerns — reliability,
price and air quality — formed the
centrepiece of his logic.
Reliability
The quality of electricity supply inHong
Kong trumps the world with reliability at
over 99.999 per cent . Hongkong Electric
(HKElectric) customers in particular
experience less than oneminute of
outage each year. At first glance, some
may not think that CSG’s 99.96 per cent
reliability is that much of a difference,
but those few decimal points translate to
3.2 hours a year, or 16minutes amonth!
If even a recent eight-minute breakdown
of the local metro caused chaos
throughout the city, it’s not too difficult
for one to imagine how disastrous 16
minutes would be to a city of soaring
high-rises and a financial centre. Not
only would the banks and stock exchange
be affected, lifts, water pumps and even
emergency services would be severely
crippled. Option 1 would be a big step
backwards for Hong Kong.
Price
HK Electric customers currently
pay about HKD1 per kWh. This
compares favourably to HKD1.31 per
kWh inMacau, which purchases over 90
per cent of its electricity fromCSG, and
to other major cities worldwide. If Hong
Kong was to connect to CSG’s network,
it would require HKD20-30 billion of
new infrastructure which translates
to HKD0.30 per kWh. Add that to the
wholesale price of HKD0.80 per kWh
that Macau pays and Hong Kong’s own
network costs, buying electricity across
the border would undoubtedly be more
expensive than local generation.
Air quality
The electricity supplied to CSG’s
Guangdong grid is primarily generated
from coal, so more coal will have to be
burnt to meet new demand fromHong
Kong. While some may think out of
sight, out of mind, monsoon winds put
paid to that notion. The winter winds
regularly blow polluted air south to
Hong Kong. Not only would Hong
Kong’s cousins to the north suffer from
coal burning, the air would eventually
blow south to Hong Kong and the
rest of the Pearl River Delta. Cleaner
burning gas would benefit people in
Hong Kong and China alike and help
China’s efforts to reduce its overall
carbon footprint.
Mr Fok’s strong views come from
decades of experience of working in the
power sector and a great love of Hong
Kong, HK Electric’s headquarters. The
call to duty to make his views known
has been answered in convincing
fashion.
Hong Kong’s future energy options pit
clean vs coal, certain vs questionable.
Mr Canning Fok makes the case for
local generation.
VIEWS
Energy[Policy
HK Leads on price and stability
0.7
2.1*
14.1
38.5
41.0
$1.00
$2.30
$2.61
$2.04
$1.31
