The government has threatened to regulate power firms by passing a law if negotiations on the terms of new agreements are not completed this year.
Environment minister Edward Yau Tang-wah told lawmakers yesterday a contingency plan was needed because time was running out.
He said the intention was still to regulate CLP Power and Hongkong Electric through schemes of control. The existing agreements run out next year.
Mr Yau said: 'Since I took office on July 1, I have had several rounds of negotiations with the two power companies. The two power companies have yet to accept the terms put forward by the government for the new scheme of control agreements.'
If the talks did not yield results, the government would frame its terms in a draft law.
The objective was to ensure the public can continue to enjoy reliable, safe and efficient electricity supplies at reasonable prices, Mr Yau said.
Hongkong Electric said legislation was not needed at this stage. CLP Power said it would continue negotiating in a constructive manner.