Market power: Secretary for Economic Development & Labour Stephen Ip says more competition in the local power market is welcomed.

Secretary for Economic Development & Labour Stephen Ip has confirmed receiving an application from a power firm to build an electricity transformer and plant cables in Sha Tau Kok. He said detailed information will be needed before a decision is made.

Mr Ip said the Government welcomes more competition in the power market. After getting a more detailed plan, departments will consider the application by taking into account safety, environmental protection, planning and land use.

Mr Ip said the Government must strike a balance among the four objectives of a reasonable cut in power charges, a reasonable return for the power companies, a stable power supply and a cut in emissions.

He said the Government's energy policy is to ban new coal-fuelled generators and install emission reduction facilities. Power plants must achieve emission targets by 2010.

Mr Ip denied the alleged worsening of the relationship with China Light & Power, adding people's demand for cleaner air is reasonable and there is sufficient time for the company to meet the target.

On the question of approved returns, Mr Ip said the current consultation will end on March 31 and all views collated will be carefully considered before deciding the way forward.