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Renewable Electricity Feed-In Tariff April 2018

19 April 2018
The Hong Kong Government has announced that power generated by Renewable energy systems could earn attractive payments setting an RE feed-in tariff.

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What is a Feed-in Tariff?

The Feed-In tariff is the rate or money, per kwh of electricity, paid by the electricity utility to the renewable energy owner, for electricity generated used RE, for example solar photovoltaic or wind turbines, and sold to the utility electricity grid.

The rates the utilities companies will pay is only fixed until 2033 RTHK reports, and bizarrely is subject to annual review. A sliding scale has been adopted, related to the RE system capacity (most probably gross capacity):

  1. HK$5/kwh for less than 10kW
  2. HK$4/kwh for 10 - 200kW
  3. HK$3/kwh for 201 kW - 1mW

The above rates quoted were abstracted from the RTHK report.

Although the feed in tariff seems quite attractive, compared to present utility charges (HK$ 1.1 - 1.3 kwh at 2018 prices) the terms are not, investment decisions are based on the risk, therefore offering a term fixed rate that can be adjusted annually will not help.

This announcement is a certainly a milestone, but unlikely to trigger increasing Renewable energy systems as witnessed in Germany, because this deal carries risk, the term is too short, and critically after the investment is made, subject to review when your rate maybe cut.

The report does not mention regulating the fees the utility companies charge for grid connection.

Source: RTHK Report 2018-04-17 HKT 17:50

About the Author

John A. Herbert is a veteran engineer with more than 30 years engineering experience, educated in the United Kingdom he has worked across Asia for the last two decades engaged by international and local companies. He is a Hong Kong Registered Energy Assessor (REA) and BEAM Professional.

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