WEDNESDAY, OCTOBER 15, 1986
ELECTRICITY COST A KEY FACTOR *****
THE GOVERNMENT'S OBJECTIVE THROUGHOUT ITS EVALUATION AND CONSIDERATION OF THE DAYA BAY PROJECT WAS THAT THE ELECTRICITY GENERATED BY THAT PLANT WOULD COST NO MORE THAN
ELECTRICITY GENERATED IN HONG KONG BY CONVENTIONAL MEANS, THE FINANCIAL SECRETARY, THE HON PIERS JACOBS, TOLD THE LEGISLATIVE COUNCIL TODAY (WEDNESDAY).
WINDING UP DEBATE ON THE MOTION ON THE DAYA BAY ISSUE,
MR JACOBS SAID IN THESE CONSIDERATIONS THE GOVERNMENT HAD TAKEN INTO ACCOUNT THE POTENTIAL COST AND FINANCING OF A NEW COAL-FIRED STATION IN HONG KONG,
IT ALSO CONSIDERED THAT THE SHARE OF THE HONG KONG NUCLEAR INVESTMENT COMPANY IN THE DAYA BAY PROJECT WOULD NOT CONSTITUTE PART OF THE CHINA LIGHT AND POWER GROUP OF COMPANIES (CLP) NET FIXED ASSETS FOR THE PURPOSE OF CALCULATING PERMITTED RETURN UNDER THE PROVISIONS OF THE SCHEME OF CONTROL.
PERHAPS MOST IMPORTANT FROM THE POINT OF VIEW OF THE CONSUMER, THE PRIOR APPROVAL OF THE GOVERNMENT WAS REQUIRED BOTH FOR ANY FINANCING PLANS THE COMPANY MIGHT WISH TO ADOPT IN RELATION TO ANY MAJOR ADDITIONS TO THE COMPANY'S SYSTEM AND THE TARIFFS THE COMPANY MIGHT CHARGE TO ITS CONSUMERS.
MR JACOBS ALSO EXPLAINED THE PROCEDURES ADOPTED FOR AGREEING THE LEVELS OF ELECTRICITY PRICES CHARGED BY CLP, AND POINTED OUT THAT IN ORDER TO ESTABLISH AGREEMENT CONCERNING THE LEVELS OF PROJECTED TARIFFS A FINANCING REVIEW WAS CONDUCTED JOINTLY BY THE GOVERNMENT AND CLP.
+ IN THE REVIEW, A FINANCING PLAN IS SUBMITTED FOR APPROVAL BY THE EXECUTIVE COUNCIL. THE REVIEW GIVES PROJECTIONS OF CLP'S COMMITMENTS OVER A FIVE-YEAR PERIOD AND THE LEVEL OF TARIFF WHICH NEEDS TO BE CHARGED TO FUND THOSE COMMITMENTS, HE SAID.
MR JACOBS SAID HE WAS AWARE THAT COUNCILLORS WISHED TO KNOW HOW THE PURCHASE OF ELECTRICITY FROM THE DAYA BAY STATION WOULD BE DEALT WITH IN CALCULATING OR COMPUTING THE TARIFF CHARGED BY CLP. DETAILS WOULD BE GIVEN IN THE PAPER HE WOULD BE ISSUING,
+BRIEFLY, NUCLEAR POWER PURCHASED BY CLP WILL, FOR SCHEME OF CONTROL PURPOSES, BE TREATED LIKE ANY OTHER PURCHASE MADE BY CLP IN THE PROCESS OF PROVIDING ITS CONSUMERS WITH ELECTRICITY. THAT IS. IT WILL BE CONSIDERED IN EXACTLY THE SAME WAY AS THE PURCHASE OF COAL, OIL, OR INDEED ELECTRICITY PURCHASED FROM THE HONGKONG ELECTRIC COMPANY, HE SAID.
MR JACOBS POINTED OUT THAT THE NUCLEAR OPTION WAS CHOSEN FOLLOWING A COMPREHENSIVE JOINT FEASIBILITY STUDY UNDERTAKEN BY CLP AND THE GUANGDONG POWER CORPORATION.