CLP Holdings managing director Andrew Brandler has warned against 'change for change's sake' when the government overhauls the regulatory framework on Hong Kong's power providers.
The government is studying the future regulatory environment for the power industry after the Scheme of Control expires in 2008. Critics say the scheme, which regulates CLP and the Hongkong Electric Holdings (HKE), is overly generous and results in prices that are too high.
However, Mr Brandler warned against changes driven by short-term political expediencies and said any ill-thought out reforms could have damaging consequences for all parties.
'The future regulatory regime has to be thought through on the basis of what objectives will be achieved,' he said.
The Scheme of Control ties the return CLP and HKE can earn to their spending on assets, capping it at a 15 per cent maximum of their assets in use.
'The scheme of control mechanism has been a well-proven and well-tested regulatory structure,' Mr Brandler said.