Our total air emissions rose to 149.2kT in 2017 from 137.8kT in 2016, due mainly to a significant increase in generation from Jhajjar in India driven by greater customer demand. We continued to invest in maintaining our standards of efficiency for our plants and to meet increasingly stringent regulations on emissions and fuel efficiency across different jurisdictions. An example is our emissions control retrofit of one unit completed at Fangchenggang I in Mainland China, in 2017.
Our operations in Hong Kong are subject to a number of laws and regulations relating to environmental protection and safety. For 2017, the Company and CAPCO maintained full compliance with environmental licence requirements in all material aspects.
Since 1990, we have concentrated our efforts on reducing emissions and, despite a more than 80% increase in electricity demand, we have managed to reduce emissions of SO2, NOx and RSP by more than 85%.
Since 2017, CAPCO has faced a new set of emissions caps that required its power plants to further reduce emissions by 6% to 9% from the very tight base of 2015 and 2016. CAPCO was able to meet these new requirements, due to increased gas consumption optimising the fuel mix, the use of more low-emissions coal, enhancing the effectiveness of emissions control facilities – all whilst maintaining high supply reliability at the same time.
CLP Power Hong Kong concluded discussions with the Government on a new set of emissions caps for the power stations starting in 2022. Under the new Technical Memorandum, the allowances for air emissions of SO2, NOx and RSP in 2022 and afterwards will be reduced by 80%, 53% and 53% respectively compared with 2010 levels.
Our fuel mix strategy in Hong Kong
A diversified fuel mix is crucial for energy security and maintaining a balance between meeting emissions caps requirements and mitigating fuel cost pressure. In 2017, we continued to optimise our diversified fuel mix which consists mainly of coal, nuclear and natural gas.
In March 2015, in the public consultation on future development of the electricity market, the Hong Kong Government announced a new policy objective, which is to increase Hong Kong’s percentage of local gas generation to around 50% of the total by 2020. To support this direction, in 2016 CLP obtained Government approval for the construction of a new 550MW gas-fired high efficiency combined cycle generation unit at the Black Point Power Station. Construction work is in progress and we aim to commission the new unit before 2020.
In addition, we continued our discussions with the Government and other stakeholders regarding the proposal to build an offshore liquefied natural gas terminal in Hong Kong waters that will enable us to have direct access to a range of gas sources from around the world and strengthen the reliability of Hong Kong’s fuel supplies. The project is in the final stages of its environmental impact assessment study and we target to obtain Government approval towards the end of 2018. We are also proactively engaging with potential suppliers to secure the additional supply of gas needed on a long-term basis. A final investment decision on the project is expected by the end of 2018.
For gas demand in the near term, we are working closely with CNOOC China Limited to link the new Wenchang gas field in the South China Sea to our existing pipeline to bring additional gas to Hong Kong in the second half of 2018.
In January 2017, the Government announced a new carbon intensity reduction target. By 2030, Hong Kong will lower its CO2 emissions per unit of GDP by 65% to 70% from the 2005 level. According to the Government, Hong Kong will phase down coal-fired electricity generation and increase the use of natural gas and non-fossil fuels in the fuel mix in order to meet this target. CLP will work closely with the Government on the way forward.
The Wallerawang Power Station in New South Wales, Australia is undergoing decommissioning, demolition and rehabilitation (DDR) which will require large areas of land to be remediated. Assets such as ash dams, coal stockpiles and asbestos repositories will be remediated to an agreed environmental standard to ensure that the land and associated ground and surface water will be suitable for redevelopment or closure.
A resource recovery project is underway to recycle or redeploy materials from the power station rather than dispose of them to landfill. Environmental impact studies are underway to determine how the land will be remediated to the required environmental standard. Regulatory approvals are being sought to allow Wallerawang to import capping material (clean fill) that will be needed to remediate the ash and asbestos repositories. In addition, the management of water in and around the DDR site will be crucial to ensuring the long-term success of the land remediation. Modelling of groundwater options to allow for the closure of the ash repositories is currently underway.
We manage our biodiversity impacts on a site-specific basis since our operations have different levels of interaction with the local ecosystems, depending on factors such as location, the level of development in the vicinity and the surrounding environment.
Many of our work on biodiversity across the Group have become ongoing activities such as the vegetation management work along our transmission lines in Hong Kong, the fish management regime in place at our Jiangbian hydro power station in Mainland China, as well as the bird cataloguing work by Paguthan Power Station in India.
For our transmission and distribution network in Hong Kong, biodiversity within protected areas is particularly material. Protected areas include country parks, marine parks and the Mai Po Nature Reserve (a RAMSAR site), which are identified as having high biodiversity value. We have a total of about 104 km of 400kV overhead lines in designated country parks and the Mai Po Natural Reserve (about 52 km in length). A series of ordinances regulate and guide our design, construction and decommissioning work and the equipment used in these areas to minimise impact to the surrounding ecosystems.
In Australia, there is a Progressive Rehabilitation Plan and a Conservation Management Plan for the Yallourn Mine that specifies the actions and plans for the life of the Mine and its final rehabilitation. This considers and requires a net biodiversity gain for losses due to mining. Our biodiversity offsets have generally scored a net gain although some areas were significantly affected during the Feb 2014 fires and are slowly recovering.
The mine is located in a predominantly industrial area which is recognised as a modified ecosystem. The habitats protected or restored include Plains Grassy Woodland, Swampy Riparian Woodland, Riparian Scrub and Wetland Complex. The species included flora and fauna in the IUCN Red List and national conservation lists, including Strzelecki Gum (Eucalyptus strzeleckii) which is listed as “vulnerable”, and the Great Egret which is of state significance.
Our Mt Piper and Wallerawang Power Stations also have a Biodiversity Offset Management Plan which sets out the establishment of native vegetation to benefit the land and native wildlife. In December 2017 around thirty volunteers from the power station planted up to 500 trees and shrubs at Thompsons Creek Dam which was built to supply water to Mt Piper. The Large-eared Pied Bat and Eastern Bent-wing Bat are listed as threatened species in the area, so the plants sourced from the local nursery were chosen to provide additional habitat for the bats.