THE CHARTEred Bank, HONG KONG,
2.
Electricity Price
The Hong Kong Government had said that the price of electricity purchased from the nuclear power station must be lower than the cost of producing electricity in Hong Kong from conventional fossil fuels. An adviser (Lazards) had been appointed to report on this by July. It was now thought a report would not be ready until August.
In May, President Mitterand visited China and similarly reached agreements tabled in a Memorandum :-
1. Both Governments fully agreed on a JV.
2.
The nuclear island consisting of 4 reactor sets would be jointly manufactured, partly in France and partly in China. A fifth set would also be jointly manufactured but this would be undertaken wholly in China.
3. The overall design of the power station would be
undertaken by Electricite de France (EDF).
Following the visit, a Chinese delegation went to
France on 24th May for discussions with both Framatome and EDF. An offer from the latter was expected in July, and the Chinese expect to sign the first contract with France in August.
Framatome was at the same time producing quotations including the nuclear island and the turbo generators, and the Chinese were looking for contract signature in the 4th Quarter.
Mr. Peng ended his statement with a powerful emphasis on the need for speed: his team had costed the seconds, both before and after commissioning. They were aware of WCLB's voice in Hong Kong affairs, and wanted this emphasis passed on so that consideration of the electricity price would be accelerated.
I leave you to pass a copy of this letter to Bim Davies if you think it appropriate.
With kindest regards,
Yours sincerely
Bill
P.S.
W.C.L. Brown
I have forwarded a copy of this letter to the Financial Secretary as he may be interested in the comments regarding electricity prices.
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