TNAG-1058-FCO40-1308-Guangdong-nuclear-power-station-project-1981 — Page 95

(vii)

22

a

Subject to early agreement by all parties and with concerted effort, it is possible to commission the first unit in 1988, though the program is considered to be tight.

Economic Feasibility

4.2

(i)

(ii)

(iii)

(iv)

The estimated total investment on a 2 x 900 MWe PWR nuclear power station is US$4068 million inclusive of escalation, interest during construction and first fuel charge. The present value of the investment is US$2369 million. 90% of the investment will be financed by loans, 68 by GPC investment and 4% by HKNIC equity share.

The results of extensive economic analyses and calculations indicate that the levelised cost of electricity from GNPC within 20 years after commissioning will be lower than that from a coal-fired plant in Hong Kong. This demonstrates that nuclear generation in Guangdong will be competitive.

The electricity generated by the nuclear power station will be distributed according to the equity ratio of GPC and HKNIC, i.e. 60% to GPC and 40% to CLP. For the payment of electricity to GNPC, CLP will pay in Hong Kong currency and GPC will, in principle, use RMB supplemented by foreign exchange in order to maintain a foreign currency balance in the GNPC accounts. To acquire sufficient foreign exchange, GPC will resell one-third to one-half of its share of electricity to CLP at a price equivalent to the GNPC price plus a fixed percentage to be determined before signing of the contract. In order for CLP to purchase this electricity, the price would have to be financially attractive to both Companies.

It is anticipated that GPC, CLP and GNPC will repay all loans within 15 years.

Major Benefits

The benefits to Guangdong & GPC are:-

4.3

(i)

(a)

(b)

meeting the GPC system demand growth, acquiring advanced generation technology and gaining company management and project management experience through the construction and operation of the nuclear power station;

diversification of energy sources and conservation of fossil fuel, particularly oil;

Ai ka

A de