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Give us a clearer picture, Hong Kong lawmakers urge officials on electricity market study findings

Results described as failing to show a diversity of opinions

Lawmakers are demanding a more precise breakdown of the results of a public consultation on the development of the electricity market as nearly a third of submissions were templates and the rest a mystery.

They said the results of the government’s consultation were simplistic and failed to show a diversity of opinions.

“The results of this consultation, I think, is too simple,” said tourism sector lawmaker Yiu Si-wing at a meeting of the Legislative Council’s economic development panel on Monday.

“There are 5,000 templates but we don’t have any breakdown of these other figures. We need to know people’s views and what most of the public is concerned about. Some may have put forward very unique and professional views … such as on renewable energy.”

Panel chairman James Tien Pei-chun agreed, and asked the bureau to provide more detailed analysis. “We want to know the justifications. There are over 10,000 submissions so there must very different views,” he said.

Deputy secretary for the environment Vincent Liu Ming-kwong said his office would consider if more detailed information could be provided to members.

The findings of the government’s consultation, which drew 15,765 submissions, saw no need to break the monopolies held by the city’s two power suppliers, nor cut the profits they could make.

More than half of respondents favoured keeping return rates at 9.99 per cent to give power companies an incentive to invest.

A third of submissions to the consultation, which ended in June, came at the behest of green groups, which favoured lower fees and more competition. The source of the rest remained a mystery.

Others favoured lower returns but “a relatively small number of respondents” suggested a rate below 6 per cent”. Earlier this year, the government had proposed lowering the rate of return from the 9.99 per cent down to 6 to 8 per cent.

Some lawmakers, including those from the business sector, had reservations on whether the level was appropriate without stricter conditions imposed on the suppliers for more renewable energy generation and the interconnection of their power grids. They also were sceptical about renewing the framework for another 10 or 15 years.

Labour’s Lee Cheuk-yan said the government claimed large-scale renewable energy was not feasible locally but that technology was improving. “If we sign for another 10 years and your grid isn’t opened, no one will be able to tap into it,” he said.

Tien, from the pro-business Liberal Party, said even 6 to 8 per cent was “a bit high” given the economic and low-interest rate environment. “When I joined Legco in 1988, the permitted rate of return was 15 per cent, but no one thought it was high because borrowing costs and inflation were both more than 10 per cent,” he said.

“The yield on 30-year US treasury bonds is now at 3 per cent … so the 6 to 8 per cent really amounts to big earnings for them in this environment.”

He also pointed out that there was no need for such a high guaranteed return or lengthy contract – both CLP Power and HK Electric are eyeing another 15 years – as the two suppliers had already made most of the long-term investments they needed over the last few decades.

In response, Liu said many coal-fired plants would soon have to be retired and replaced, while natural gas generation would involve high costs. “Many new investments are needed,” he said.

Environment chief Wong Kam-sing said while public opinion was clear, its consultant would examine the rate of return and the government would begin official negotiations with the two suppliers next year with the aim of setting a final rate in the next one or two.

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Frequently Asked Energy Questions

Frequently Asked Questions

How much coal, natural gas, or petroleum is used to generate a kilowatthour of electricity?

The amount of fuel used to generate electricity depends on the efficiency or heat rate of the generator (or power plant) and the heat content of the fuel. Power plant efficiencies (heat rates) vary by types of generators, power plant emission controls, and other factors. Fuel heat contents also vary.

Two formulas that can be used to calculate the amount of fuel used to generate a kilowatthour (kWh) of electricity:
• Amount of fuel used per kWh = Heat rate (in Btu per kWh) / Fuel heat content (in Btu per physical unit)
• Kilowatthour generated per unit of fuel used = Fuel heat content (in Btu per physical unit) / Heat rate (in Btu per kWh)

Calculation examples using these two formulas and the assumptions below:
• Amount of fuel used to generate 1 kilowatthour (kWh): • Coal = 0.00052 short tons or 1.05 pounds
• Natural gas = 0.01010 Mcf (an Mcf equals 1,000 cubic feet)
• Petroleum = 0.00175 barrels (or 0.07 gallons)

• Kilowatthour generated per unit of fuel used: • 1,904 kWh per ton, 0.95 kWh per pound, of coal
• 99 kWh per Mcf (1,000 cubic feet) of natural gas
• 570 kWh per barrel, or 13.6 kWh per gallon, of petroleum
Power plant heat rate1

Coal = 10,089 Btu/kWh
Natural gas = 10,354 Btu/kWh
Petroleum = 10,334 Btu/kWh

Fuel heat contents2

Coal = 19,210,000 Btu per short ton (2,000 pounds) Note: heat contents of coal vary widely by types of coal
Natural gas = 1,025,000 Btu per 1,000 cubic feet (Mcf)
Petroleum = 5,892,000 Btu per Barrel (42 gallons) Note: Heat contents vary by type of petroleum product

1 Heat rates for steam electric generators in 2013.
2 Heat contents for fuels consumed by the electric power sector in 2013.

Sweden R&D team says dye-sensitized cells may work better when “dead”

October 12 (SeeNews) – Researchers at Uppsala University, Sweden, have discovered that some old dye-sensitized solar cells can perform better when they have dried-out, and are conducting further research in the work of such “zombie” solar cells.

In the so-called Graetzel cell, an electrically conductive liquid facilitates a flow of electrons. When this liquid was gone, a solid hole conducting structure was created, continuing to transport positive charge, as revealed by Gerrit Boschloo’s group at the Department of Chemistry-Angstroem Laboratory.

In certain cases, the dried-out solar cells worked better than before. Boschloo said specific cells had hit 8% power conversion efficiency, a record for dye-sensitized solar cells with a solid hole conductor.

“Several companies have said that if it would only seal properly, they’d invest in liquid-based solar cells. If we would be able to seal these ‘zombie cells’ so that they would last for years, it would be very interesting,” Boschloo commented.

The research group is collaborating with two chemistry groups at The Royal Institute of Technology (KTH) and experts in the field of industrial manufacturing from Swerea IVF. The researchers have filed a patent application for the “zombie solar cell” through their own company Dyenamo.