The new Scheme of Control Agreements reached between the Government and Hong Kong's two power companies will help strike a balance between tariffs and the expansion of environmentally friendly power plants.
Secretary for the Environment KS Wong made the statement to the media after attending a Legislative Council meeting today.
The new agreements will enable the companies to replace power generators with cleaner ones using natural gas. However, this will increase pressure to raise tariffs.
Mr Wong said the agreements achieved a balance between tariffs and the need to encourage power companies to help combat climate change.
"The new scheme of control has fixed the profit rate (the permitted rate of return) and reduced it from 9.99% to 8%. This will help to (strike a) balance on the overall situation."
