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April, 2009:

CLP To Pay HK$730m For Wind Power Assets

Denise Tsang, SCMP – Apr 08, 2009

Electricity supplier CLP Holdings (SEHK: 0002) has agreed to buy mainland wind-power projects from its Australia-based partner for HK$730 million, making its first move to restructure its renewable energy investments overseas.

The deal involves the acquisition of a 49 per cent stake in 10 wind farms largely in Jilin and Shandong provinces from Roaring 40s Renewable Energy, a 50-50 joint venture between CLP and Hydro Tasmania of Australia.

The acquisition will add 122 equity megawatts to CLP’s renewable energy capacity, increasing it to more than 1,200MW, or 9 per cent of its total generation capacity.

To lift the renewable energy capacity ratio to 20 per cent of its total generation capacity by 2020, CLP yesterday said it would acquire Roaring 40s’ green energy portfolio in India “in the near future”.

A CLP spokesman said the India acquisition involved one wind farm. The price is still being negotiated.

Group chief executive Andrew Brandler said the restructuring of ownership of Roaring 40s’ mainland portfolio would instantly boost CLP’s exposure to the country’s fledgling green energy market while bringing its target non-carbon-emitting generating capacity closer to reality.

The company would keep its interest in Roaring 40s, which would in turn focus on renewable investments such as geothermal and solar energy in Australia after the asset restructuring, he said.

Two of the 10 wind farms are in Jilin and one in Shandong. The rest were under construction, a CLP spokesman said.

Some analysts said investment on renewable energy development was commercially viable on the mainland because of incentives such as lower tax, higher on-grid tariffs and government subsidies.

CLP, which has been accused by green groups of being Hong Kong’s biggest polluter, has aggressively expanded its clean-energy investments in hydro, wind, biomass, solar and geothermal power on the mainland, in Australia, India, Thailand and Laos as part of its non-carbon-emitting vision for 2050.

Mainland Allows HK Firms To Run Green Projects – Relaxed Rules Give Conditional Access To Greenhouse Gas Market

Cheung Chi-fai, SCMP – Apr 08, 2009

Hong Kong companies will receive conditional access to massive carbon-reduction markets across the border after mainland authorities eased the eligibility rules.

The change came about after the National Development and Reform Commission “reinterpreted” the rules recently, Secretary for the Environment Edward Yau Tang-wah said.

Beijing had previously insisted that only companies with at least half their equity supplied by Chinese capital in a strict sense would be eligible to develop projects on the mainland under the Clean Development Mechanism (CDM).

Now, it says Hong Kong-registered companies based in the city and run by Chinese nationals or Hong Kong permanent residents who constitute half of the company’s board membership will also be acceptable.

Other criteria include a minimum threshold of 50 per cent of non-circulating shares for a listed company.

Under the UN-supervised CDM – the world’s second-biggest greenhouse-gas market after the European Union’s emissions-trading system – developing countries can sell certified emission reductions generated from qualified projects, such as renewable energy, to developed nations to meet their Kyoto Protocol commitments to cut carbon emissions.

The changes will put Hong Kong back into the growing CDM market on the mainland, which is the biggest supplier of CDM projects in the world, accounting for a third of the 1,500 projects already registered with the UN. The mainland is estimated to deliver more than 100 million credits a year from the projects, with each credit equalling a tonne of carbon reductions.

Mr Yau, who said he had been informed of the change in Beijing last week, hailed it as a “turning point”.

He said Hong Kong companies were set to benefit from new business opportunities in the huge CDM market all over the mainland.

But it would be difficult to assess what kinds and sizes of companies would benefit from the relaxed rules as they would still have to satisfy the national requirements for qualifying CDM projects, he said.

“The most important thing in the change is that it has lowered the bar for entering the market,” Mr Yau said. “Without that, no matter how big or small a company is, it just can’t participate.”

Industry sources said local utilities such as CLP Power (SEHK: 0002), which had a growing investment in renewable energy such as wind or hydro power, would be major beneficiaries.

The Hong Kong General Chamber of Commerce, which had advocated the change for some time, said it would allow genuine Hong Kong companies to take part in the green-technology market on the mainland.

Last year, Beijing also relaxed rules for CDM projects in Hong Kong, allowing companies registered in the city to develop projects without paying the administrative fee imposed on the mainland.

William Yu Yuen-ping, head of WWF Hong Kong’s climate programme, said the change might draw more companies to Hong Kong – including those that specialise in verifying and certifying CDM projects.

Government To Help Firms Take Advantage Of Green Opportunities

Cheung Chi-fai, SCMP – Apr 08, 2009

The government will organise seminars for local professionals in environmental services this month, to help them explore emerging markets locally and across the border, Environment Secretary Edward Yau Tang-wah said.

Mr Yau said the Closer Economic Partnership Arrangement had enabled such servicing companies to own and operate businesses on the mainland. That would increase their chances of tapping the growing demand for environmental services amid the economic transformation in Guangdong province.

“Hong Kong and Guangdong are strongly pushing forward energy efficiency and emission reduction,” he said. “There is great room for these environmental professionals to organise themselves to cater to this rising demand.”

Chief Executive Donald Tsang Yam-kuen announced plans last week to further explore business opportunities for the environment industry, among others, in the global financial crisis.

Mr Yau said some of the sector’s professionals might be ready to pursue their advantages; but others might need to adjust their operations, or join forces, to tap the opportunities.

The HK$450 million matching-fund scheme for energy and carbon audits and improvement works for local buildings, to be launched today, would be an opportunity for such firms to find business locally, he said. Across the border, Mr Yau said, the market was also growing gradually, after the introduction of the HK$93 million clean-production scheme. So far, 160 companies have participated in the programme. The scheme’s success has encouraged Guangdong provincial and local authorities to roll out similar incentive programmes, which would increase the demand for environmental services.

Mr Yau said green businesses were still taking shape in Hong Kong and across the border, and it was still difficult to know how big the market was. “It is like a blind man who tries to feel the size of an elephant … [he] can never tell how big the elephant is.”

ANALYSIS-In Big Green Push, Australia Thinks Too Small On Solar

Reuters By Leonora Walet and Bruce Hextall – Wed Apr 8, 2009

HONG KONG/SYDNEY – At first glance, a new day seems to be dawning for the overshadowed solar sector in Australia, the world’s sunniest continent.

The government is pushing through a carbon trading scheme that will penalise big greenhouse gas emitters; a major piece of renewables legislation is due for approval within months, setting a target of 20 percent green energy by 2020.

But supporters say these shiny targets may be undermined by policymakers who think too small — limiting the most generous rebates for renewables to the first 1,500 watts of capacity, or about half the minimum of the 3,000-5,000 watts used by the average Australian home.

“The limit of something like 5 KW would have been a really useful driver,” said Muriel Watt, chair of the Australian Photovoltaic Association. “But the limit being 1.5 KW, it’s not going to drive the large systems we’d like to see.”

Australia draws just about 5 percent of its electricity from renewable sources, mostly hydropower and wind. Solar power comprises less than one percent.

The Clean Energy Council, Australia’s main clean-tech body, has urged the government to raise to 200 KW the limit for renewable energy installations eligible for generous rebates.

Instead, say campaigners, Australia needs to adopt a nationwide feed-in tariff structure that would allow users to generate revenue by selling excess power back to the grid.

Such “feed-in” tariffs in Germany, for example, led to the country’s solar power installations increasing 11-fold since it introduced a generous gross feed-in tariff eight years ago.

China and Japan are also ramping up solar investment, with China last month announcing a subsidy of 20 yuan ($2.93) per watt peak for large solar projects. Japan offers a further $200 million subsidy to boost home solar panel usage for the year from April 1 after a $90 million outlay from January to March.

Australia’s policies have not proved as enticing. BP Plc’s (BP.L) solar unit in Sydney, which operated the only panel-making plant in the country, closed down last month to cut costs.

That leaves the Australian market open to Japan’s Kaneka Corp (4118.T) Sanyo Electric Co Ltd (6764.T) and Sharp Corp (6753.T), and China’s Suntech Power (STP.N) and JA Solar (JASO.O).

Australian firms that have persevered despite the obstacles include electricity and gas supplier Origin Energy Australia (ORG.AX), Dyesol (DYE.AX) and Silex SLX.AU, which are working on individual solar cell technologies.


Solar, though, remains costly compared with wind power, and particularly with coal, which generates 80 percent of Australia’s energy, making it one of the most coal-reliant nations in the world.

“That’s one of the hardest things for us to compete against. There’s a real inadequacy of government programmes and inconsistencies but whatever they do it’s still competing against cheap brown coal,” said Simon Troman, vice-president of the Australian and New Zealand Solar Energy Society.

He said coal-fired power generators had long enjoyed subsidies from taxpayers, with for example, transmission lines linking power stations being built for free.

The coal lobby — together with other carbon-intensive export-oriented industries such as mining — also wields tremendous political influence, not only because of the higher costs but for fear of unstable electricity supplies in a country that regularly faces sporadic shortages.

“Everyone knows perfectly well what’s holding things back,” said renewable energy policy expert Mark Diesendorf of the Institute of Environmental Studies at the University of New South Wales in Sydney.

“It’s a group called the greenhouse mafia. It consists of the coal industry, oil, aluminium, iron and steel, cement and motor vehicle makers,” he told Reuters.

The government has backed mandatory renewable energy target legislation (MRET) that ramps up existing targets to 20 percent national green energy production by 2020. Parliament is expected to pass the law within months.

The law is expected to attract renewable energy investment of A$20 billion to A$30 billion by 2020, with wind power capturing the most investment initially, analysts say.


Australian states and territories have introduced, or want to introduce, schemes to reward householders for power fed back into the grid. But so far, only the tiny Australian Capital Territory has opted for the more generous gross feed-in tariff from March this year for systems up to 30 KW.

Solar Shop Australia, the country’s largest installer of domestic solar systems, wants the federal government to implement a national gross feed-in tariff, instead of the less generous nett tariff backed by most states.

Diesendorf said there was no incentive for large-scale solar power from the federal government, a view echoed by the manager of an energy systems supplier.

“Even for very small commercial installations of 20 to 50 KW on buildings or small farms, there’s very little incentive,” said the manager, who did not want to be named. “The feed-in tariffs designed in most states exclude commercial solar projects.”

But engineering firm WorleyParsons Ltd (WOR.AX) announced plans last year to build the world’s largest solar plant, a 250 MW project, in Australia.

The plan would be reliant on big mining firms funding the A$1 billion ($710 million) project. Mining firms want to invest in renewable power to cut fuel costs and curb carbon emissions to meet targets under national emissions trading, expected to begin in the middle of next year.

WorleyParsons said it aimed to deliver 40 percent of Australia’s renewable energy needs with 34 solar power plants by 2020 but carbon credits would have to be priced at well over A$10 a tonne to make the solar power plants commercially viable.

The government estimates credits under its scheme will initially trade above A$20 a tonne of carbon pollution. (A$=71 U.S. cents) (Additional reporting by David Fogarty; Editing by Clarence Fernandez)

Online Guide To Climate-friendly Goods Launched – New List Shows Appliances’ Footprints

Cheung Chi-fai, SCMP – Apr 02, 2009

A green group has called on electrical appliance manufacturers to provide more low-carbon-emission products for the global market, after the publication of the first local guide on climate-friendly goods.

The online guide, launched by WWF Hong Kong yesterday, lists 300 models of nine popular electrical appliances that have low carbon footprints, are made under more than 50 brands and are available on the local market.

It offers information on annual energy consumption, efficiency, carbon emissions and price references for climate-conscious shoppers.

There are also tips on the wise use of appliances.

The information was collated from data obtained from manufacturers and energy labelling schemes in Hong Kong, the United States and Europe.

“All those models in the guides are low carbon emission, but we won’t tell people how to choose as we have given them the tool to make their own choices,” said William Yu Yuen-ping, the head of WWF’s climate programme.

The appliances covered include air conditioners, compact fluorescent lamps, refrigerators, televisions, water heaters, rice cookers, laptop computers, printers and game consoles.

Dr Yu said the first six types of appliance already accounted for 85 per cent of total household electricity consumption, which grew by 34 per cent between 1990 and 2005.

The guide would fill the gaps in Hong Kong’s energy efficiency labelling scheme, which has so far made labelling mandatory only on air conditioners, compact fluorescent lamps and refrigerators.

Consumers using the guides are advised to decide what their priorities are because they might have to compromise.

For instance, the most climate-friendly model will often not be the cheapest, while the one which offers the highest energy efficiency will not necessarily be the one which consumes the least energy.

Dr Yu said it was time for individuals to act and exert their influence on the market.

“If there are demands from the public, manufacturers will be motivated to produce more low-carbon appliances.

“Let’s get started in our daily lives instead of just relying on the politicians to do something for us,” Dr Yu said, citing the Copenhagen climate conference to be held later this year.

Wat Hong-keung from the Hong Kong and Kowloon Electric Appliances Trader Federation welcomed the guide, but said consumer awareness about energy efficiency had improved in recent years.

“Many of them pay great attention to energy efficiency in case they have two choices of similar quality and price,” he said.

“But they are normally motivated by saving money rather than saving the world.”

The guide can be seen online at