Business Monitor International


Hong Kong Power Report

Published 25 July 2014

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Hong Kong Power Report

BMI View: Thermal energy continues to account for the almost all of Hong Kong's domestic energy production; while there have been some tentative steps towards generating energy from renewable sources, these have been few and far between. Closer energy links with China raise questions about how best to reconcile Hong Kong's reliable energy service with China's more volatile market.

BMI forecasts that real Hong Kong's GDP growth will average 3.4% a year between 2012 and 2022, with an increase of 5.0% estimated for 2011. BMI is forecasting an average annual increase of 2.23% to 41.07TWh between 2013 and 2017. Thermal generation, comprising coal, gas and oil, is expected to grow by an average of 2.08% per annum over the same period, and average 2.57% between 2018 and 2022. Thermal power generation will continue to account for all of domestic production, with imports from nuclear and pumped storage capacity in China .

Apart from domestic thermal energy production, Hong Kong is making limited progress in the field of renewable energy, with both China Light & Power (CLP) and Hong Kong Electric Co. (HEC) drawing up plans for offshore wind farms. In addition, Hong Kong imports electricity generated by nuclear power stations in mainland China - Hong Kong has no plans to build its own nuclear facilities - and CLP has struck a deal with Chinese firms over long-term plans to import natural gas.

Hong Kong stands in 12th position in BMI's Asia Power Risk/Reward Ratings (RRRs), thanks to its modest market size and below-average growth prospects. It scores above average for industry and country risks, with its total score dragged down by the rewards side of the matrix.

Key developments for Hong Kong's power sector include:

  • Hong Kong's energy dependence on China is growing, with the Hong Kong government agreeing to a deal by CLP Power Hong Kong to purchase natural gas from state-owned PetroChina's second east-west pipeline over the next two decades.

  • ExxonMobil has...

Table of Contents

BMI Industry View
7
SWOT
9
Industry Forecast
11
Hong Kong Snapshot
11
Table: Country Snapshot: Economic and Demographic Data (Hong Kong 2013-2018)
11
Table: Country Snapshot: Economic and Demographic Data (Hong Kong 2018-2023)
11
Table: Country Snapshot: Power Sector
11
Hong Kong Power Forecast Scenario
12
Electricity Generation and Power Generating Capacity
12
Table: Total Electricity Generation Data And Forecasts (Hong Kong 2012-2017)
12
Table: Total Electricity Generation Data And Forecasts (Hong Kong 2018-2023)
13
Table: Electricity Generating Capacity Data And Forecasts (Hong Kong 2012-2017)
15
Table: Electricity Generating Capacity Data And Forecasts (Hong Kong 2018-2023)
15
Electricity Consumption
20
Table: Total Electricity Consumption Data And Forecasts (Hong Kong 2012-2017)
20
Table: Total Electricity Consumption Data And Forecasts (Hong Kong 2018-2023)
20
Transmission & Distribution, Imports & Exports
22
Table: Electric Power T&D Losses Data And Forecasts (Hong Kong 2012-2017)
22
Table: Electric Power T&D Losses Data And Forecasts (Hong Kong 2018-2023)
22
Table: Trade Data And Forecasts (Hong Kong 2012-2017)
22
Table: Trade Data And Forecasts (Hong Kong 2018-2023)
22
Industry Risk Reward Ratings
24
Asia Power Risk/Reward Ratings
24
Table: Fact Box: Vietnam's Power Development Roadmap
27
Table: Asia Power Risk/Reward Ratings
30
Hong Kong Power Risk/Reward Ratings
31
Rewards
31
Risks
32
Market Overview
33
Key Policies And Market Structure
33
Regulation And Competition
33
Sustainable Energy Policy
34
Pricing
34
Hong Kong Power Projects Database
35
Table: Major Projects - Power
35
Competitive Landscape
36
China Light and Power (CLP)
36
Power Assets/HEC
36
ExxonMobil
37
Regional Overview
38
Asia Regional Overview
38
Table: Regional Electricity Generation Growth, % Chg Y-O-Y
46
Glossary
48
Table: Glossary Of Terms
48
Methodology
49
Methodology And Sources
49
Industry Forecast Methodology
49
Sources
52
Risk/Reward Ratings Methodology
52
Table: Power Risk/Reward Rating Indicators
53
Table: Weighting Of Indicators
55

The Hong Kong Power Report features Business Monitor International (BMI)'s market assessment and independent forecasts covering electricity generation (coal, gas, oil, nuclear, hydro and non-hydro renewables), electricity consumption, trade, transmission and distribution losses and electricity generating capacity.

The Hong Kong Power Report also analyses the impact of regulatory changes, recent developments and the background macroeconomic outlook and features competitive landscapes comparing national and multinational operators by sales, market share, investments, projects, partners and expansion strategies.

Key Benefits

  • Use BMI's independent industry forecasts for Hong Kong to test other views - a key input for successful budgeting and strategic planning in the power market.
  • Target business opportunities and risks Hong Kong's power sector through our reviews of latest power industry trends, regulatory changes, and major deals, projects and investments in Hong Kong
  • Assess the activities, strategy and market position of your competitors, partners and clients via our Competitive Landscape analysis.

Coverage

BMI Industry View

Summary of BMI's key industry forecasts, views and trend analysis, covering power markets, regulatory changes, major investments, projects and company developments.

Industry SWOT Analysis

Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the power sector, and within the broader political, economic and business environment.

Regional Overview

The Regional Overview provides a comparative context from within which one can assess the relative profitability of the power industry in a given country, incorporating BMI's country risk macro forecasts into our regional analysis. They also detail any relevant issues or events that might cause market fluctuations, as well as evaluate the impact of existing power infrastructure and fresh investments on the regional market.

BMI Industry Forecasts

The Industry Forecasts provide historic data series and forecasts to end-2017 for electricity generation (TWh) and electricity generating capacity (MW) for each individual power segment present in the country. These forecasts are in turn supported by explicit assumptions, in conjunction with analysis of the key risks to the main forecast. These in turn are broken down into:

Electricity Generation forecasts for Thermal, Coal, Gas, Oil, Nuclear, Hydro and Non-Hydro Renewables. For this section, we provide information on electricity generation (TWh), % growth year-on-year, KWh per capita, and the % of total electricity generation. The thermal fuels (coal, gas and oil) also have figures for their % of total thermal electricity generation.

Electricity Generating Capacity offers forecasts for the potential net capacity and net capacity growth % change year-on-year for the whole power industry. It also includes individual forecasts for capacity (MW), capacity growth % change year-on-year, and % of total capacity for Thermal, Nuclear, Hydro and Non-Hydro Renewables.

The section also includes historic data series and forecasts to end-2017 for:

Electricity Consumption, encompassing information on net consumption (TWh), net consumption growth % change year-on-year, and net consumption per capita (KWh).

Transmission And Distribution Losses, comprising predictions on Electric Power Transmission And Distribution Losses, (TWh), and Electric Power Transmission And Distribution Losses, % of Output.

Electricity Trade, offering historical figures for imports and exports and forecasts for net imports (TWh).

Market Overview

This section provides an overview of the industry landscape and key players; assessment of the business operating environment and the latest regulatory developments.

Risk/Reward Ratings

BMI's Power Risk/reward Ratings provide fully comparable ratings aimed at investors (power companies, services companies and equity investors) in the regional power market. The ratings methodology makes sophisticated use of various industry, economic and demographic data points and is part of BMI's integrated Country Risk-Industry Ratings products.

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