TNAG-0949-FCO40-1168-Effect-of-nuclear-exports-to-China-on-Hong-Kong-Guangdong-nu-1980 — Page 115

CONFIDENTIAL

CONFIDEN

Levelised Cost

(US$/kWh)

Case 1

PWR 2x900 MW

Built in HK with HK conditions

Case 2

PWR 2x900 MW

Joint Venture with equity (60/40)

35% tax rate

Case 3

PWR 2x900 MW

Joint Venture with equity (60/40)

20% tax rate

Case 4

PWR 2x900 MW

PRC owned

no tax

Case 5

5

Coal 3x660 MW

Built in HK with HK conditions

Case 6

Coal 3x660 MW

S

Joint Venture with equity (60/40)

35% tax rate

12.10

13.10

12.01

11.47

21.15

22.12

?

Notes:

1.

Case 4 (PRC owned) having the lowest levelised cost of US$11.47/kWh,^ among six cases studied.

2. The higher cost in Case 2 (JV at 35% tax rate) as compared with Case 1

(PWR built in HK) is mainly due to higher tax rate used in Case 2.

3.

4.

Case 3 shows that in order to be competitive to Case 1's US¢12.10 (the HK conditions), JV's tax rate should be reduced to about 20%.

It has illustrated that nuclear cases, in terms of levelised cost, are significantly cheaper than coal (Cases 5 & 6) by about 45%.

&

dk:sl

5th July, 1980