HK Electric announces rise in electricity tariff
HK Electric announced a US$0.0018 reduction in basic tariff and a US$0.0062 increase in fuel clause charge per unit of electricity by 1 January 2011. It will reflect rising fuel costs.
The average tariff will rise from US$0.154 per unit of electricity in 2010 to US$0.1581 in 2011, a 2.8 per cent increase after the basic tariff has been reduced to alleviate the impact of the tariff rise on customers.
The Managing Director of HK Electric, Mr. Tso Kai-sum said in the Legislative Council that international fuel prices have remained volatile in recent years. Prices for coal and liquefied natural gas have gone up by 31 per cent and 13 per cent respectively since the end of 2009 and the upward trend is expected to continue in 2011.
"In light of this, we have had to adjust the fuel clause charge to reflect rising fuel costs," Mr. Tso said, noting that fuel costs are a pass through and do not form part of the Company's profit.
Mr. Tso noted that this would be the first tariff increase for HK Electric since the new Scheme of Control took effect two years ago. "In 2009, we lowered the tariff by 5.9 per cent followed by a tariff freeze in 2010. The adjustment in 2011 is solely to reflect the rising fuel costs," Mr. Tso explained.