Hongkongers should expect ‘gradual softening of energy prices’ as CLP Holdings returns to profit

International energy prices have been softening since the beginning of the year, which will filter down to customers’ bills, company says

CLP Holdings reported a net profit of US$648 million for the first six months, reversing a record loss in the first half of 2022

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The headquarters of CLP Group (China Light & Power). Photo: Shutterstock

Published: 4:40pm, 7 Aug 2023Updated: 7:19pm, 7 Aug 2023

Hongkongers could expect a “gradual softening of energy prices” as international fuel prices stabilise, according to power provider CLP Holdings, which returned to profitability in the first half of the year after a record loss a year earlier.

CLP Holdings reported a net profit of HK$5.06 billion (US$648 million) for the first six months, reversing a record loss of HK$4.86 billion in the first half of 2022, according to a filing with the Hong Kong stock exchange on Monday.

“We have seen a softening of international energy prices since the beginning of this year,” Richard Lancaster, CEO of CLP Holdings, said at a media briefing on Monday afternoon. “Over time, we would see a gradual softening of energy prices.”

Factors behind the company’s return to profit include “the dependable performance of our core businesses in Hong Kong and mainland China [and] a one-off income in India adding to a sound operational performance and progressive normalisation in Australia”, which led to a slight gain in the fair value of EnergyAustralia’s forward energy contracts, compared with a significant loss a year earlier, CLP’s filing said.

As international fuel prices continued to stabilise, the monthly fuel cost adjustment in Hong Kong– the difference between forecast and actual prices – began moving down in June and dropped to 57.1 HK cents per unit of electricity in August, a 2.3 per cent drop from January levels, CLP’s CEO designate Chiang Tung-keung said at the media briefing. Chiang will take over the reins as group CEO when Lancaster retires at the end of September.