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Eric Jiang

Small and medium-sized businesses need subsidies to cope with soaring electricity costs as fuel surcharges imposed by Hong Kong’s two power suppliers have risen by up to 78.5 per cent due to the Middle East war, an industry leader and a lawmaker have said.
HK Electric, which mainly supplies Hong Kong and Lamma islands, announced its fuel clause charge would increase by 5.9 per cent to 60.7 HK cents per kilowatt-hour (kWh) in September.
The company has raised the charge every month since June, citing the impact of the war on global energy prices. Since March, shortly after the war began, the charge has increased by 78.5 per cent.
HK Electric’s average net tariff will rise to 188.6 cents per unit in September, up by 16.4 per cent from 161.9 cents in March.
In Hong Kong, the total billed to users, or the net tariff, comprises the basic tariff plus the fuel clause charge.
CLP Power, which serves customers in Kowloon, the New Territories, Lantau and other outlying islands, also announced on Tuesday that its fuel cost charge would rise to 45.1 cents per unit in September.
Its surcharge has increased by 15 per cent since March, from 39.2 cents per unit, in six consecutive monthly rises.
The average net tariff will be 146.3 cents per unit of electricity in September, up by 4.2 per cent from 140.4 cents in March.
Those prices include the average basic tariff of 101.2 cents per unit.
Pamela Mak Mei-yee, honorary president of the Hong Kong Small and Medium Enterprises Association, said that while electricity costs were inevitable for every shop owner, absorbing rises would prove difficult.
“Once costs keep rising, and merchants find it difficult to fully pass the increase on to customers, profits will naturally be squeezed further,” she said.
Mak called on the power companies and authorities to offer time-limited support for smaller, high-consumption businesses, such as fuel-cost rebates, instalment payment options and subsidies for energy-saving equipment.
She also suggested issuing consumption vouchers to eligible households for use at specific local shops, which would ease the economic burden on residents while boosting business in the catering, retail and services sectors.

In the longer term, small and medium-sized enterprises (SMEs) should be supported in upgrading their air-conditioning, refrigeration, lighting and power-management systems to reduce the impact of future energy price fluctuations on their operations, Mak said.
The Brent crude benchmark was at US$86.80 on Wednesday morning. Despite a 1.96 per cent decline compared with the day before, the price remained higher than the US$72 recorded in late February, shortly before the war began.
To ease high electricity bills, the two utilities have introduced rebate and relief schemes, as households face higher air-conditioning costs after a summer with an unusually high number of very hot days.
The government earlier rolled out diesel and liquefied petroleum gas subsidy schemes, but these applied only to vehicles and vessels – not to commercial electricity users. They ended in June and July respectively.
Lawmaker Ray Wong Wing-wai said that while the latest electricity fee increases were not especially high, attention should remain focused on the wider energy issue.
“For the industrial and business sector, the most troublesome thing is the constant back-and-forth of hikes and cuts to electricity bills – it actually makes it harder for them to keep their costs under control,” he said. “This is something we take quite seriously.”
Wong said SMEs in industries with high electricity consumption, such as laundries and food manufacturers, were likely to be hit the hardest. Running a food factory was already difficult and higher power bills significantly increased their costs, he added.
He said one laundry business reported that electricity costs, which previously accounted for 5 to 8 per cent of its overall expenses, now represented about 13 to 14 per cent.
Wong urged the government and power companies to offer targeted subsidies for commercial users, while businesses should also adopt energy-saving tools and solutions, drawing on mainland China’s experience.
He noted that data centres would be built in the Northern Metropolis, generating substantial waste heat that could potentially be recovered for power supply.
Lawmaker Jonathan Leung Chun said many Hong Kong restaurants had gross profit margins of less than 10 per cent and could not readily pass higher costs on to consumers given they were spending less.
He said the prices of sundry goods, such as tissues, had increased because of higher transport fees, while rising labour costs had also put pressure on the sector.
“I have seen that the profitability of many different restaurants is not ideal,” he said. “If the cost further goes up, it will definitely be difficult [for the restaurants].”
Leung added that the biggest problem was not a dramatic rise in electricity costs but businesses’ already limited capacity to absorb them. Any additional expense, he said, risked becoming “the final straw”.
Additional reporting by Lam Ka-sing


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HK Electric, which supplies electricity mainly to Hong Kong Island and Lamma Island, said that its fuel clause charge would rise to 60.7 Hong Kong cents per kWh in September. Photo: Sam Tsang

HK Electric announced that its fuel clause charge would rise by 5.9 per cent to 60.7 HK cents per kWh in September. Photo: Fung Chang

CLP Power announced a fuel cost increase to 45.1 cents per unit in September. Photo: Jelly Tse

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HK Electric, which supplies electricity mainly to Hong Kong Island and Lamma Island, said that its fuel clause charge would rise to 60.7 Hong Kong cents per kilowatt-hour (kWh) in September. Photo: Sam Tsang

CLP Power and HK Electric have introduced rebate and relief schemes as grass-roots households face higher air-conditioning expenses. Photo: Sam Tsang

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Industry leader urges relief for Hong Kong SMEs and household consumption vouchers to ease pressures and support local businesses


Industry leader urges relief for Hong Kong SMEs and household consumption vouchers to ease pressures and support local businesses.


‘Squeezed further’: calls for SME energy subsidies as Hong Kong power fuel surcharges soar

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Industry leader urges relief for Hong Kong SMEs and household consumption vouchers to ease pressures and support local businesses

Industry leader urges relief for Hong Kong SMEs and household consumption vouchers to ease pressures and support local businesses