WEDNESDAY, NOVEMBER 24, 1982
19
PROPOSAL FOR PROTECTION OF PUBLIC INTEREST
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THE HON MARIA TAM SAID THE ROCKETING COST OF ELECTRICITY HAS GENERATED MUCH HEAT IN THE CONSUMERS' CRITICISM OF THE FIXED PERCENTAGE OF PROFITS MADE UNDER MONOPOLY.
SHE NOTED THAT UNDER THE RESPECTIVE SCHEMES OF CONTROL, THE CHINA LIGHT AND POWER COMPANY (CLP) IS ALLOWED TO EARN A PROFIT OF 13.5 PER CENT PER ANNUM ON ITS ASSETS ACQUIRED BEFORE SEPTEMBER 30, 1978 AND A 15 PER CENT RETURN ON ITS ASSETS ACQUIRED AFTER THIS DATE.
THE HONG KONG ELECTRIC COMPANY (HKEC) IS ALLOWED TO EARN A PROF IT AT THE SAME PERCENTAGE AS THE CLP, WITH THE WATERSHED DATE BETWEEN 13.5 PER CENT AND 15 PER CENT RETURN FIXED AT JANUARY 1, 1979.
HOWEVER, SHE POINTED OUT: +IN THE RELEVANT PERIODS BETWEEN 1979 AND 1981, CLP ELECTRICITY CHARGES SOARED FROM 23.51 CENTS PER KILOWATT-HOUR TO 49.86 CENTS PER KILOWATT-HOUR, A RISE OF 112 PER CENT AND HKEC CHARGES ALSO ROSE SIGNIFICANTLY OVER THE SAME PERIOD.
+THE CONSUMERS' EXASPERATION AND INDIGNATION OVER THIS EVER GROWING BURDEN IS CLEARLY WRITTEN ON THE WALL.
+ IF THESE SCHEMES ARE NOT MODIFIED THE TWO POWER COMPANIES PROFIT, ALTHOUGH KEPT AT 15 PER CENT OF ITS ACQUIRED ASSETS, WILL IN REAL MONETARY TERMS SNOWBALL, AND SO WILL BE THE DISSATISFACTION OF THE 5.2 MILLION CONSUMERS TOWARDS THE OTHER CONTRACTING PARTY, THE GOVERNMENT. +
TO PROTECT PUBLIC INTEREST, MISS TAM URGED THE GOVERNMENT TO
* ADJUST THE FIGURES ON REASONABLE RETURN IN THE CLP AND
HKEC AGREEMENTS TO A LOWER FIGURE;
* CONFINE DEVELOPMENT FUNDS TO THE PURPOSE OF DEVELOPING
PLANTS AND EQUIPMENTS AND NOT TO MAKE UP FOR LOSS PROFITS; AND
*
CALCULATE THE PERMITTED RETURN OF BOTH CLP AND HKEC BY REFERENCE TO +ACQUIRED ASSETS+ IN OPERATION IN THE RELEVANT YEAR OF ASSESSMENT RATHER THAN PURELY ACQUIRED ASSETS+ ON THE SPECIFIC DATES.