CLP Group (its holding company is CLP Holdings Ltd) is an electricity company in Hong Kong with businesses in a number of Asian markets and Australia. Incorporated in 1901 as China Light & Power Company Syndicate, its core business remains electricity generation, transmission, and retailing.
Power bills set to soar for Kowloon and New Territories households
Kowloon and New Territories households could see prices rise by 40pc in next five years while Hongkong Electric freezes cost of power
Households in Kowloon and the New Territories will see the cost of electricity soar by almost 40 per cent in the next five years, making it higher than on Hong Kong Island, where bills will be frozen.
The projections were released as Hongkong Electric, which serves the island and Lamma, and CLP Power, which supplies the rest of the city, announced the tariffs they have agreed with regulators for next year.
Hongkong Electric will freeze prices at 134.9 cents per kilowatt hour, while CLP will charge 110.8¢/kWh, a 3.9 per cent increase, from January 1. Hongkong Electric plans to freeze tariffs for five years.
If the projection is accurate, CLP's tariffs will surpass those of Hongkong Electric for the first time ever in 2017, when it will charge 142.6¢/kWh.
However, over the six-year period from this year to 2018, Hongkong Electric customers will continue to pay an average 134.9¢/kWhh, while CLP's customers will pay an average of 127.7¢/kWh.
CLP, controlled by the Kadoorie family, said the increase was largely down to the rising cost of gas. It will have to buy fuel pumped in from Central Asia at three times the price of fuel it uses from a reserve in Hainan which is being depleted rapidly.
The company expects tariffs to rise 11.8 per cent in 2015, 7.9 per cent in 2016, 6.7 per cent in 2017 and 4.1 per cent in 2018.
Paul Poon, president of CLP Power, said the company would strive to reduce the impact of rising costs while attempting to meet strict emission caps by 2015.
"We will try to delay consumption of the more expensive gas, burning more clean coal as well as securing as far as possible more nuclear energy imports," Poon told Legco's economic development panel yesterday.
Environment minister Wong Kam-sing said the government had agreed to significant cuts in capital expenditure for both companies.
CLP's capital expenditure for the five years to 2018 would be 49 per cent lower than the company had proposed, while Hongkong Electric, controlled by Asia's richest man, Li Ka-shing, would spend 21 per cent less.
The former will spend HK$34.1 billion, the latter HK$13 billion.
Wong said he had also given provisional approval for Hongkong Electric to commission a new gas-fired generator by 2020.
Wan Chi-tin, managing director of Hongkong Electric, said its price freeze was made possible by more stable fuel costs and the fact its projections had taken account of capital spending.
"CLP is having to catch up. But this will be a huge burden on people's livelihoods," said lawmaker Lee Cheuk-yan.
Lawmaker Lam Tai-fai praised Li Ka-shing for freezing tariffs. "I must say thank you for his mercy," he said.