Hong Kong utility CLP vows to help businesses and residents adopt renewable power generation
Scheme launching on October 1 will allow businesses and homeowners to sell excess output from devices such as rooftop solar panels back to energy suppliers
CLP Holdings, the larger of Hong Kong’s two power utilities, said on Friday it will work with the government to help residents take advantage of a scheme to install renewable power generation units at home and sell excess power back to the utility.
The scheme will help the Hong Kong government realise its commitment to cut the city’s carbon intensity per unit of economic output by up to 60 per cent by 2020 when compared with 2005, said CLP chief executive, Richard Lancaster.
“CLP is a large [renewable energy] developer in China and India, but in Hong Kong, it is a more challenging environment,” he told reporters after the listed holding company’s annual shareholders meeting on Friday. “Having a lot of small projects is probably the way that Hong Kong will develop its renewable energy sector.
“We will try to make the scheme as simple and straightforward as possible.”
So far, obstacles for homeowners seeking to join the scheme include a potential need for them to register businesses for selling power back to utilities and paying taxes on the income. Then there are strict building codes that might deem many rooftops as unsuitable for wind or solar device installations.
Lancaster said the Environment Bureau was taking the lead to work through with other government departments on some of these issues, so that the relevant legislation could be amended for the scheme to be more easily accessible for small businesses and residential customers.
“Certainly, we’ll do our best, and we hope the government can do their bit in time so that this can be rolled out smoothly in October,” he said.
CLP has so far received more than 200 enquiries about the scheme, which will be implemented on October 1, according to Betty Yuen So Siu-mai, vice-chairman of CLP Power Hong Kong.
The scheme will allow businesses and homeowners to sell excess output from devices – such as rooftop solar panels and wind turbines – back to their energy suppliers at HK$3 to HK$5 per unit depending on capacity, much higher than the standard rate of HK$1.13 they pay to their power suppliers.
The higher renewable energy prices will allow businesses and homeowners to break even on their investment on hardware in as few as 10 years.
The scheme is part of the conditions for a new 15-year agreement between the utility and the government allowing it be the sole electricity generator and distributor in Kowloon, the New Territories and Lantau Island.
It can earn an 8 per cent return on permitted assets from October this year, down from 9.99 per cent currently.
Meanwhile, Lancaster said CLP’s coal-fired power plants in mainland China continued to face volatile coal prices this year. He said steep price rises for the fuel and insufficient increases in power prices last year squeezed its profit for 2017.
A softening trend in coal prices has been noticed in recent weeks, but power prices appear likely to stay where they are for the rest of the year, he said.
CLP’s mainland China operating earnings fell by 18.6 per cent to HK$1.24 billion (US$157.972 million) last year from 2016.