As hostilities continue in the Middle East, concerns are growing over potential impacts on Hong Kong's electricity tariffs. CLP Power will raise its fuel adjustment charge from 39.2 HK cents per kilowatt-hour in March to 39.8 HK cents starting April 1. Hongkong Electric said it will follow established practice in consulting with the government on basic tariffs at year-end, during which fuel costs and operational expenses will be discussed.
Regarding the fuel adjustment charge, a Hongkong Electric spokesperson noted that while the mechanism operates with a lag, the charge is adjusted monthly and would likely show changes relatively quickly. When asked about potential increases, the spokesperson said that timing depends on developments in the coming weeks and months. "If the war continues or worsens, upward pressure on the fuel adjustment charge will inevitably follow," the spokesperson said.
Under the current mechanism, both power companies' tariffs comprise a basic tariff and a fuel adjustment charge. According to Hongkong Electric's website, the basic tariff is derived by dividing the sum of forecast standard fuel costs, operational expenses, and permitted profit by projected electricity sales. The fuel adjustment charge is revised monthly based on average actual fuel costs from the preceding three months, with fuel costs passed directly to customers—the company earns no profit from this component.
The Hongkong Electric spokesperson said natural gas accounts for approximately 69% of the company's power generation fuel mix, primarily sourced from Australia and Qatar. In addition to the Guangdong Dapeng liquefied natural gas terminal, the company's offshore LNG terminal east of the Po Toi Islands also receives natural gas procured from global markets.
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