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Following is a question by the Hon Kenneth Leung and a written reply by the Secretary for the Environment, Mr Wong Kam-sing, in the Legislative Council today (April 9):
Question:
With the release of a consultation paper on the future fuel mix for electricity generation last month, the Environment Bureau has launched a three-month public consultation on two fuel mix options. The first one is the "grid-purchase option", under which more electricity will be imported through purchasing electricity from the China Southern Power Grid Co. Limited (CSG). The second is the "local generation option", under which more natural gas will be used for local electricity generation. In this connection, will the Government inform this Council:
(1) whether the authorities had, before putting forth the "grid-purchase option" as a choice for consultation, collected statistics on the number of power supply incidents in CSG in the past and looked into its fuel mix for electricity generation in order to assess the stability of its power grid as well as the impacts of purchasing electricity from CSG on the regional environment; if they had, of the details and whether such information will be made available to the public;
(2) given that the grid-purchase option involves capital investments for installing cross-boundary transmission infrastructure and local back-up generating capacity, as well as possibly transportation and load management charges, whether the authorities have assessed the level of investments, the management charges and the service lives of the transmission infrastructure concerned; if they have, of the results;
(3) given that the local generation option involves capital investments for installing new power generation units, whether the authorities have assessed the level of investments as well as the service lives of the new power generation units concerned; if they have, of the results;
(4) whether it will consider, on the premises that the public approve of the increase in the share of nuclear power in the future fuel mix for electricity generation and that new power generation units will not be built, purchasing more electricity from Daya Bay Nuclear Power Station for supply to Hong Kong;
(5) whether it will set any output target on the electricity generated by using renewable energy and by turning waste to energy; if it will, of the details; if not, the reasons for that; of the expenditure involved in, as well as the specific details of, the development of renewable energy by the Government in the past five years, and the quantity of electricity generated using renewable energy each year; and
(6) as an engineer has pointed out that for some reasons, the hydro-power stations in Yunnan Province opened up the spillway to dispose of the stored water instead of generating electricity, resulting in a loss of approximately 24 000GWh in the power generation output of the whole province last year, which is more than half of the whole-year electricity consumption (43 000GWh) of Hong Kong, and that in view of this, Hong Kong may consider purchasing from the Yunnan authorities the electricity generated at designated stations and transmitting it to Hong Kong through CSG and paying to CSG the charges on electricity transmission through its power grid, together with the additional investment expenditure on infrastructure, whether the authorities have considered if the proposal is feasible and studied the option of only purchasing the electricity from the Mainland power grid which is generated using renewable energy; if they have, of the details; if not, the reasons for that?
Reply:
President,
(1) The reliability of electricity supply hinges on adequacy of electricity at the supply source. We also need to ensure that the quality of electricity import in terms of frequency and voltage can be maintained at the prescribed level. After conducting preliminary assessments, the Government considers it technically feasible to import electricity from the Mainland. First, there is adequate power supply from the China Southern Power Grid (CSG). Based on the existing information, we estimate that our import required from CSG in 2023 would account for less than 2% of the total generation by CSG in 2012. Also, Hong Kong should be able to benefit from the strong support provided by CSG's entire power grid with multiple sources of supply under this grid-to-grid mode of electricity supply. Hong Kong may also retain local back-up generation capacity to cater for emergency.
We note there are concerns over the supply reliability of CSG. However, it should be noted that CSG is serving five provinces covering different areas including metropolitans as well as rural towns, which have different requirements on the reliability of electricity supply. Hence, it is not appropriate to make reference to an overall figure such as the total number of power supply incidents. We understand that Macau now imports electricity from CSG to meet about 90% of its electricity need, and its supply reliability exceeds 99.999%, similar to the current level of Hong Kong. If a decision is finally taken to go for this option, detailed technical studies would be conducted to ensure supply reliability.
Regarding the impact on the regional environment by purchasing electricity from CSG, our assessment is that importing electricity from the Mainland should not cause any notable increase in the overall emission in the Pearl River Delta region given that the estimated amount of electricity to be purchased would only account for less than 2% of CSG's overall generation, that the share of clean energy in CSG's current fuel mix (one-third being renewable energy (RE)) is higher than that of Hong Kong, and that it is the national policy to further increase the use of clean energy.
(2) and (3) In assessing the cost of the "grid purchase option", we have taken into consideration the cost of purchasing electricity from the Mainland, the cost of relevant transmission infrastructure (such as submarine cable), as well as the cost of making available backup generating units locally. In assessing the cost of the "local generation option", we have taken into account the price of natural gas and the cost of putting in place new gas generating units.
Having regard to the above considerations and based on various assumptions, we estimate that the unit costs under both options will roughly double the unit generation cost over the past five years, and the price differential between the two options is not substantial. However, the actual generation costs would depend on a host of intervening factors that could only be ascertained at a later stage. For instance, the cost of electricity import would depend to a large extent on the cost of construction of cross-boundary transmission network and its alignment, which could only be ascertained after study and site survey. To avoid compromising Hong Kong's position in future negotiations over electricity import or natural gas prices, we consider it not appropriate to further disclose the details of the assessment on the relevant generation costs.
(4) Hong Kong has been importing on average 70% of the generation output of the Daya Bay Nuclear Power Station (DBNPS), and more than 90% during summer when electricity demand is at the peak. The rest of the output from DBNPS is being supplied to the Mainland power grid. Hence, we consider it not feasible to rely on importing more nuclear power from the existing facilities in DBNPS to meet the long-term electricity demand of Hong Kong.
(5) The generation of certain forms of RE requires natural resources, such as solar, wind and hydro power. However, the physical environment of Hong Kong has imposed a lot of constraints on the wide application of such RE resources. Not only is it costly but its room for development is also limited. Therefore, our current policy is to adopt solar or wind facilities for demonstration purpose, subject to their cost-effectiveness and meeting operational needs. On the other hand, waste-management facilities can also turn waste into RE. Hence, the Environment Bureau already covered in the "Hong Kong: Blueprint for Sustainable Use of Resources 2013-2022" and "A Food Waste & Yard Waste Plan for Hong Kong 2014-2022" a number of waste-to-energy facilities including sludge treatment facility, integrated waste management facility, and a network of organic waste treatment facilities. With regard to the projects already completed and being planned, we estimate that the share of RE from waste will make up about 1% of total electricity demand by the early 2020s.
From 2009 to 2013, the two power companies generated 1.1 million kWh, 1.4 million kWh, 1.6 million kWh, 1.9 million kWh and 1.9 million kWh electricity by RE, which constituted around 0.004% of their overall generation.
(6) We consider it not desirable to import hydro power directly from Yunnan by constructing dedicated transmission lines, as the construction of such long distance dedicated transmission lines will significantly increase the transmission costs. Also, its supply reliability depends on the availability of water resources; electricity supply will be affected in case of drought. Moreover, this "point-to-grid" mode of electricity supply lacks flexibility in catching up with rising electricity demand. We may need to identify new dedicated sources to meet long-term electricity demand. On the other hand, if not transmitted through dedicated lines, electricity on the grid could not be differentiated with reference to their energy types. Therefore, we consider it not practical to specify a particular source of electricity when purchasing from the power grid.
Ends/Wednesday, April 9, 2014
Issued at HKT 14:53
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