Transcript of remarks by SEN
Reporter: Mr Wong, you said that the electricity bills can go down by 5 per cent under the new deal. Can you give more details, does it represent basic tariffs plus the fuel charge, or the whole bill?
Secretary for the Environment: Yesterday I mentioned that based on various conditions, it would largely remain the same and based on the change from 9.99 per cent to 8 per cent in terms of the permitted rate of return (RoR), the translation into tariff reduction could be more than 5 per cent. The intention is on one hand to show that the change in RoR would help to relieve the tariff consideration, and at the same time, if we would like to let the public understand more about the translation from the RoR to tariff implication, the 5 per cent would give them a better feeling. But when I said this, I made prequalifications that there are assumptions that the other major parameters would remain more or less the same. So the intention is like that.
Reporter: Some people criticised the 15-year time frame for the deal, saying that it would give less flexibility for the Government to make changes. What do you have to say to that?
Secretary for the Environment: As I clarified earlier that in fact in the past, except the current one, all scheme of control (agreements) are based on 15 years. It is to some extent reasonable for this kind of power companies and operations that need long term investments. There are at least two major considerations for this time. One is that in the forthcoming 10 years or so, there are a large number of coal-fired power plants reaching their retirement age, so we need a more stable and certain environment for a strategy, including the investors to invest on the new replacements. Secondly, to echo the Paris Agreement, Hong Kong made a carbon reduction plan towards 2030, so for the forthcoming 10 years or so, the Hong Kong society should focus on these carbon reduction and environmentally friendly initiatives, so that we can have a reasonable timeline for us to reach our 2030 carbon reduction target. It is a combination of considerations that we think, at this time, a 15-year period would be much more appropriate for Hong Kong.
(Please also refer to the Chinese portion of the transcript.)
Ends/Wednesday, April 26, 2017
Issued at HKT 12:20
Issued at HKT 12:20