NOV.
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HE RECALLED THAT THE SECRETARY FOR ECONOMIC SERVICES HAD ALSO MENTIONED ON NOVEMBER 10 THAT ONE OF THE PURPOSES OF THE GOVERNMENT MONITORING THE AFFAIRS OF THE PUBLIC UTILITIES WAS TO ENSURE THAT SHAREHOLDERS GET A REASONABLE FINANCIAL RETURN ON THEIR INVESTMENT.
HE POINTED OUT, HOWEVER, THAT THE AVERAGE NET RETURN BASED ON SHAREHOLDERS FUNDS FOR CHINA LIGHT IS 14,87 PER CENT PROM 1967 TO 1979, 20,4 PER GENT IN 1980 AND 24 PER CENT IN 1901.
HE ESTIMATED THAT THE PERCENTAGE FOR 1982 COULD BE IN THE REGION OF 27 PER CENT AND THAT IT WOULD WELL EXCEED 30 PER CENT IN THE LATE 1980'S.
+DOES THE SECRETARY FOR ECONOMIC SERVICES STILL THINK THAT THIS IS A REASONABLE FINANCIAL RETURN FOR THE SHAREHOLDERS'
INVESTMENTS?+ HE ASKED.
+ IT IS MY OPINION, 16 PER CENT IS REASONABLE, 20-25 PER CENT IS EXCESSIVE AND 30 PER CENT OR OVER IS ENORMOUS, PARTICULARLY WHEN DEALING WITH CAPITAL INTENSIVE INDUSTRY OF PUBLIC CONCERN.
TURNING TO THE DEVELOPMENT FUND, MR LEE SAID ITS TERM NEEDED TO BE REVIEWED.
IN HIS OPINION, THE FUND WAS BEING USED AS AN EQUILIBRIUM FUND INSTEAD OF ASSISTING THE COMPANIES IN THE ACQUISITION OF FIXED ASSETS.
+ IN OTHER WORDS IN ANY GIVEN YEAR, IF THE POWER COMPANIES' PERMITTED RETURN IS IN EXCESS OF 15 PER CENT, THE EXCESS WILL BE TRANSFERRED TO THE DEVELOPMENT FUND.
+ON THE OTHER HAND, IF THE PERMITTED RETURN OF 15 PER CENT IS NOT REACHED, IT WILL BE TRANSFERRED FROM THE DEVELOPMENT FUND TO MAKE UP THE DIFFERENCE.
+THIS PRACTICE CONFIRMS MY ARGUMENT OF GUARANTEE PROF IT, HE SAID.
WITH REGARD TO THE RESERVE CAPACITY, MR LEE SAID THE SUBJECT ALSO NEEDED TO BE EXAMINED AS RESERVE CAPACITY IS IN DIRECT PROPORTION OF CAPITAL INVESTMENTS+.
HE NOTED THAT THE RESERVE CAPACITY FOR CHINA LIGHT IN 1983 WILL BE 34.2 PER CENT AND THAT FOR HONG KONG ELECTRIC WILL BE * PER CENT.
+BOTH NETWORKS ARE INTERCONNECTED, BUT I UNDERSTAND IT IS A MANUAL SYSTEM.
+WHY CAN IT NOT BE INTERCONNECTED THROUGH AN AUTOMATIC SYSTEM?
+WHAT IS THE USE OF A GRID NETWORK IF IT IS MANUALLY OPERATED?+ HE ASKED.