Fok slams power import proposal
The chief of Power Assets has made his strongest stand yet against the government's proposal to import an additional 30 per cent of Hong Kong's power from the mainland by 2023.
Canning Fok Kin-ning, chairman of Power Assets - which is controlled by Li Ka-shing - yesterday tore into the proposal, rubbishing all its supposed advantages pertaining to price, reliability and environmental-friendliness.
He said Hong Kong cannot afford to accept China Southern Grid's record of 3.2 hours a year - or 16 minutes a month - of blackouts in its operating areas, the likely high import price and a shifting of carbon emission from Hong Kong to other parts of the Pearl River Delta.
"Even small delays like eight minutes [at the subways] have already caused so much chaos. Can you imagine the kind of chaos wreaked by 16?" he told reporters after Power Assets' annual shareholders meeting. "Hong Kong's buildings are mostly high-rises with elevators. We also host many banking systems, computers and there's a stock exchange to consider."
Power assets is the largest shareholder of Hongkong Electric, the sole power supplier to Hong Kong Island and Lamma Island.
According to Hongkong Electric managing director Wan Chi-tin, Hong Kong Island saw less than one minute of blackouts a year, and less than two minutes in Kowloon and the New Territories, compared with 1 hour 6 minutes in Shenzhen and 1 hour 48 minutes in Guangzhou.
Southern Grid is the sole power distributor in five southern provinces.
Fok also said Hong Kong will likely have to pay more for imported power since Macau, which buys more than 90 per cent of its power needs from Southern Grid, is paying HK$1.30 a kilo-watt-hour (kWh), compared with HKE's HK$1.
Public consultation on the import option and an alternative to almost triple gas-fired power's contribution to total demand will end on June 18.
CLP Holdings, the sole power supplier to Kowloon and the New Territories, is not adverse to the import option and suggests dedicated power lines be built to ensure supply reliability. It is a partner of Southern Grid, which part-owns CLP's Hong Kong business.
Sanford C. Bernstein senior analyst Michael Parker said Guangdong's power reliability has made great strides in the past decade and will likely improve further in the next decade as power demand growth slows and grid infrastructure is upgraded.
Hong Kong's power price will have to rise if it produces cleaner, gas-fired power due to higher gas prices, he said, adding the import option will hurt Hong Kong power firms' profits in the long term by cutting the assets on which their returns are based, since power generation is more asset-heavy than distribution.