CEM signs 15 year power supply contract extension

Macao SAR and Companhia de Electricidade de Macau have signed the Power Supply Contract Extension for 15 years. This significant event reaffirms the long and successful cooperation between the Macao SAR and CEM for the benefit of the Macao community.

The new terms consider the opening of the power generation allowing for the introduction of renewable energy. At the same time the existing generation capacity in Macao will be maintained to support the reliability of the service and to retain an important industry in Macao. In future, the Macao SAR will identify the power resources plan by defining the primary energy sourcing. Also a Tariff Stabilization Fund will be created with funds supported by CEM operational surplus, a mechanism that will allow stabilizing the tariffs.

The new contract also provides for higher compensation to customers in case of power outages under CEM’s responsibility. The Average System Availability Index (ASAI) of last year reached 99.999%. Under the new terms of the contract, CEM will continue the investment in electricity infrastructure to further ensure the already high supply reliability which is one of the highest in the world, and to meet with the ongoing growth of power consumption to allow for the harmonious social and economic development of the Macao SAR.

CEM, as a social responsible company with the strong support from all its shareholders, has agreed to significantly reduce the Permitted Return to 9.5 per cent, a level that is even lower than the cases of both Hong Kong electricity companies.

The new terms is the result of careful discussions taking into consideration the balanced interests of all the stakeholders, providing an adequate framework to further transform the power industry, allowing an efficient, reliable and high quality services at reasonable prices that shall contribute to the continuous development of the Macao SAR.