- 4-
15.
Since it is very much to KEC's advantage to produce electricity as cheaply as possible, and to sell it to CLP at the highest price possible, whilst still making it attractive to the purchaser, the greater the difference available to KEC between the cost of generation and the selling price, the more profit the KEC will make.
16.
Since KEC is itself a Government body why should they reduce that profit by paying a dividend to outside shareholders.
(c)
KEC/CLP Joint Venture but with Foreign Interests
17.
A
If KEC desires CLP to arrange for Foreign participation in the nuclear power station then it would be necessary
(a) for KEC to hold shares in that Nuclear Power
Station Company registered in PRC.
(b)
for the foreign interests to form a Hong Kong Registered Company for the purpose of holding their investment in the PRC Registered Company.
There would'need to be one or more directors from the Hong Kong Registered Company on the PRC Registered Company Board.
Management fees, secretarial and registration fees, all would have to be paid.
Conclusions
18.
As Chairman of China Light & Power Co. Ltd., I envisage:
(a)
CLP entering into a long-term contract to purchase a minimum amount of electricity subject to their being assured of continuity of supply and the price delivered into their distribution network being below that at which they could generate it themselves.
(b)
CLP/KEC and others establishing an entirely independent Hong Kong Registered Project
Management Company outside CIP's normal operation to act as a liaison with all parties concerned.