Introduction

Background

During the Public Consultation on the Future Development of the Electricity Market in 2015, public attitude towards the development of Renewable Energy (RE) was positive. There was general support for the further development of RE, despite its higher tariff implications.

Under the post-2018 Scheme of Control Agreements (SCAs), Feed-in Tariff (FiT) and RE Certificates are two important new initiatives to promote the development of distributed RE. FiT will help encourage the private sector to consider investing in RE as the power generated could be sold to the power companies at a rate higher than the normal electricity tariff rate to help recover the costs of investment in the RE systems and generation. At the same time, RE Certificates will be sold by the power companies for units of electricity from RE sources. Through these RE Certificates, the community can show its support for RE. The revenue from the RE Certificates will also help alleviate the overall tariff impact on all consumers brought about by the introduction of the FiT scheme. Apart from the FiT and RE Certificates schemes, the power companies will facilitate grid connection and improve the relevant arrangements.

FiT

The key features of the FiT Scheme are as follows:

1. Taking into consideration the RE potential in Hong Kong, FiT will be offered to solar photovoltaic (PV) systems as well as wind systems;
2. Any non-governmental bodies or individuals, who as customers of the relevant power company plan to install distributed RE systems at their premises in the respective power company’s supply area with a generating capacity of up to 1 MW are eligible for prescribed FiT rates from that power company as long as they have been connected to the latter’s grid. RE systems with a capacity exceeding 1 MW will be considered on a case-by-case basis. If equipped with any form of energy storage provisions, FiT will only be payable based on the units of electricity actually generated by the distributed RE systems and regardless of whether the RE generated is actually exported to the grid;
3. Distributed RE projects built prior to the commencement of the FiT scheme may also participate and receive FiT;
4. Gross FiT will be adopted whereby FiT will be paid for all units of electricity generated by the RE systems. Any units of electricity used at the premises will be charged at the prevailing tariff rates;
5. FiT will be offered throughout the project life of the RE systems until end 2033. The electricity generated by the RE systems after 2033 will belong to the RE system owner;
6. The FiT rates to be adopted at the launch of the FiT Scheme are set at:
   (a) $5 for ≤10kW;
   (b) $4 for >10kW to ≤200kW; and
   (c) $3 for >200kW to ≤1MW.
7. The same FiT rate, as applied to the RE system upon joining the FiT scheme, will be adopted for the entire lifetime of a given project or until end 2033, whichever is earlier. Those who install the system early may be able to make a return after the aforementioned payback period; and
8. The FiT rates will be reviewed annually and applied to the corresponding RE systems that join the FiT scheme within the prescribed period from the announcement of the revised rates until new FiT rates, if any, are separately published.

For CLP Power Hong Kong Limited (CLP), application forms and information are now available on CLP's website and CLP app. Successful applicants can start receiving FiT from 1 October 2018. For The Hongkong Electric Company, Limited (HEC), application forms and information are now available on HEC's website and HEC app. Successful applicants can start receiving FiT from 1 January 2019.

RE Certificates

The main features of the RE Certificates are as follows:

1. The RE Certificates will represent units of electricity from local RE sources (whether such electricity is generated or purchased by the power companies), with the demand for RE Certificates matching the supply of RE within a prescribed period so as to allow the power companies to have some operational flexibility;
2. The RE Certificates will be priced having regard to market appetite and will be reviewed annually;
3. RE Certificates will be available for sale by each power company to its respective customers within its supply area; and
4. The two power companies will introduce RE Certificates in January 2019.

Measures to Further Promote RE Development

To promote public participation in RE development, EMSD has added this new section on FiT to the HKRE Net, aiming to provide relevant information to the public as far as practicable. A hotline (6395 2930) has also been set up to handle enquiries about RE. While we strive to provide useful information in relation to the installation of RE systems to the public through the website and the hotline, and in the interest of facilitating the public, will coordinate information from other relevant departments concerning requirements beyond EMSD's purview, please note that the information provided is by no means exhaustive and members of the public are encouraged to seek advice from a professional in the event that they are not sure about the requirements applicable to installation of RE systems at their particular premises.