CLP's stockpiling of diesel spurs cost fears

CLP Power is reportedly stockpiling costly diesel as a contingency for fuel, as it needs several months to repair its Castle Peak coal power plant that was damaged by Typhoon Vicente late last month.

That has sparked concerns of a possible rise in the electricity tariff due to higher fuel costs. A concern group is urging the government to release more information.

An industry insider said CLP had been buying more diesel than usual in the typhoon's wake.

The news emerged a day after a local newspaper reported growing speculation within the transport industry that CLP's increased fuel purchases had caused the recent rise in diesel prices.

A CLP Power spokeswoman declined to give details about its recent diesel purchases, nor did she respond to questions about whether electricity tariffs would rise as a result.

She also would not confirm whether the power plant was already burning diesel, only saying that its fuel-mix strategy 'allows for a back-up plan such as utilisation of ultra-low-sulphur diesel at other generating units as a substitute during the temporary suspension of coal supply to Castle Peak'.

The plan also includes back-up support from Hongkong Electric and other power sources if necessary.

Four of the eight power generating units were shut down after a section of the overhead belt transporting coal stock to the station fell from a height of about 50 metres on July 26.

CLP has been asked to submit a report on the conveyor belt's collapse. The total capacity of the shuttered units was 1,400 megawatts, more than a third of the plant's gross capacity.

The spokeswoman said the closure would not affect power supply, but work on repairing the conveyor belt was progressing and it would take several months to return to full supply capacity.

The Coalition to Monitor Public Transport and Utilities has voiced concern about a possible rise in electricity tariffs.

The Environment Bureau yesterday refused to say whether diesel was being used at Castle Peak, nor would it say if tariffs would rise as a result.

4.9%

CLP Power raised electricity tariffs by this much after failing to persuade the government in December to allow a 9.2 per cent increase