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The Government today (May 31) signed two agreements on demand side management with CLP Power Hong Kong Limited and Hongkong Electric Company Limited respectively.

"The Demand Side Management Agreements signify the commitment of Government and the two power companies to promoting energy efficiency and conservation while maintaining reliable and adequate electricity supply in Hong Kong. A package of Demand Side Management Programmes drawn up under the Agreements will be launched shortly to encourage the public to contribute to protecting the environment by using energy more efficiently," the Secretary for Economic Services, Mr Stephen Ip said after signing the agreements.

Under the Agreements, the power companies agree to promote energy efficiency and conservation through implementing Demand Side Management Programmes worked out with Government. The Programmes were developed on the basis of a Government consultancy study which had taken into account overseas experience and the local situation. The Energy Advisory Committee and the Legislative Council Panel on Economic Services were also consulted in the process.

The Agreement and Programmes have been revised in the last few months taking into account views of members of the Legislative Council. The latest package of Demand Side Management Programmes will feature targeted promotional programmes, general education on energy efficiency and conservation and market researches as well as a rebate scheme to encourage non-residential customers to install energy efficient lighting and air-conditioning equipment.

The rebate scheme is expected to result in savings in peak electricity demand of 33MW after the three-year Programme period. The power companies will finalise the detailed implementation plans after signing of the Agreements and will notify their non-residential customers of the application procedures in the next few weeks.

The power companies will levy a Demand Side Management Charge on non-residential customers starting from January 2001 to finance the rebate scheme and related programmes for them. The Charge is expected to be modest at around 0.5 per cent of their total electricity bill. In the long run, all electricity users are expected to benefit from the Programmes as they use energy more efficiently and the use of power supply facilities are optimised with a slower growth in peak demand.

Mr Ip said saving energy means saving money on electricity bills and helping the environment. He hoped that the public would respond positively to the Demand Side Management Programmes as a high level of public participation is the key to their successful implementation.

To show their support for the Programmes, the two power companies have decided to forego incentive earnings of about $76 million over the three-year Programme period.

End/Wednesday, May 31, 2000

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