Government rejects third party State-owned China Power International Holding's ambitious project to challenge Hong Kong's electricity duopoly has fallen through, according to Li Xiaolin, the daughter of former premier Li Peng and the core backer of the project. Breaking silence on the ill-fated project that came to light two years ago, Ms Lin said yesterday that the Hong Kong government did not approve the project. It had sought to supply power to customers near the mainland border at Sha Tau Kok and eventually expand across Victoria Harbour to Hong Kong Island. Despite the setback, she said, her group remained interested in the market and would pursue any opportunities that arose. 'The government did not approve the project, and I will not comment on the government's decision,' said Ms Lin, a Chinese People's Political Consultative Conference delegate. 'The market should be opened and be competitive.' Asked if she was disappointed at the government's lack of approval, Ms Li said China Power International, of which she is president, would take 'a hopeful attitude' on the market becoming more competitive. China Power International was the biggest shareholder in the joint-venture China Hong Kong Power Development, founded in 2006 to break into the city's power market dominated by CLP Power and Hongkong Electric. The joint venture, which also counted media firm Vertex Group and state-owned China Southern Power Grid as shareholders, intended to build its own power grid in Sha Tau Kok and tap into commercial and industrial users. The Hong Kong government, through a spokeswoman, recently replied to the South China Morning Post's queries on the project, saying it was 'concerned [that] duplicating [the] network is not a sustainable way to open up the electricity market'. Without specifying its decision, the government believed 'the duplicative road-digging and cable-laying works would cause disturbance to the public'. An Environment Bureau spokesman said last night the bureau had heard nothing from the power supplier after trying to get more information about the proposals. China Hong Kong Power's hopes of sharing CLP's power transmission and distribution grid were dashed when the utility rejected a partial opening of the market, which it feared would lead to cherry-picking of CLP's customers, wasteful competition and unstable tariffs. CLP owns the power grid, making third-party access difficult. In addition, when the Hong Kong government divulged the post-2008 regulatory framework in January, it said it would study introducing competition into the market. Some proponents said an open market would create a choice of suppliers for consumers. Opponents said Hong Kong's market should be interconnected with the Guangdong market to make commercial sense.
