Current progress and future development of wind energy in Hong Kong

Transcription

1 Title Current progress and future development of wind energy in Hong Kong Author(s) Yu, Wai-kwok.; 余 偉 國. Citation Issued Date 2011 URL Rights The author retains all proprietary rights, (such as patent rights) and the right to use in future works.

2 by Yu Wai Kwok, Ringo Supervisor: Prof. Dennis Y.C. Leung September 2011 Master of Science in Environmental Management The University of Hong Kong

3 Abstract Wind energy technology is one of the most widely used renewable energies over the world. To investigate its prospect in Hong Kong, the present thesis provides an overview on the current progress of wind energy and analyzes the potential of future wind energy s development in Hong Kong. Currently, a commercial-scale 800 kw wind turbine and a numbers of small wind turbines ranging from 100 to tens of kw are operating, while two large offshore wind farms were proposed by the two local power companies respectively and will be constructed in near future. For future development of wind energy, the technology can be economically competitive with other energy sources and is economically feasible to be developed in Hong Kong. Political support is crucial for developing wind energy, adopting policy instruments such as Carbon Taxes and Renewable Energy Feed-in Tariffs (REFITS) are very useful, whereas cooperation with China is also a potential option. In meteorological aspects, sufficient wind resources are present locally, but due to geographical constraints, offshore wind farms are predicted to have largest potential for development. In addition, installing Building Augmented Wind Turbines (BAWT) is another direction of development having potential, because wind resource can be enriched in certain dense built environments of Hong Kong due to concentrator effects, and the wind resources can be utilized by BAWTs. It is concluded that currently wind energy development is immature in Hong Kong due to lack of lands and inadequate political support, but it is the most feasible kind of renewable energy in long term and have potential for development. Government s role is vital, more supports and efforts should be paid by the government especially in economical and political aspects. Further researches should also be done to investigate effective ways to utilize wind energy in Hong Kong.

4 t., rt l- t; l; 1"., l: t: lr I l; t-, ll rf t-, rl rl rj rl rl Declaration The University of Hong Kong Current Progl'ess and Future Development of 'ù/ind Energy in Hong Kong This dissertation represents the author's own work conducted for the purposes of this MSc in Environmental Management programme. All significant data or analysis used in this dissertation from other sources - including work the author may have carried out for purposes other than for this programme - Signed: University Numbe r : has clearly been identified as such. lt

5 Acknowledgements I wish to express my sincere gratitude to Professor Dennis Y.C. Leung for his kind support and guidance in this study. I would also like to thank the China Light & Power Hong Kong Limited (CLP) and the Hongkong Electric Company Limited (HEC) for giving out their opinions that contribute to this study. Yu Wai Kwok, Ringo September, 2011 ii

6 Contents Declaration... i Acknowledgement... ii Contents iii List of Figures.. Lists of Abbreviations.. v vi Chapter 1 Introduction Background Objectives and methodology Structure of the thesis 2 Chapter 2 Literature Review Wind energy as a renewable energy Wind energy development in the world Wind energy development in Hong Kong. 8 Chapter 3 Energy Overview and Current Status of Wind Energy usage in Hong Kong Energy overview in Hong Kong Energy consumption in Hong Kong Energy market structure in Hong Kong Energy policy in Hong Kong Current Status of Wind Energy usage in Hong Kong Background Lamma Winds Southwest Lamma (SWL) Offshore Wind Farm Southeastern Waters (SEW) Offshore Wind Farm Small wind turbines Chapter 4 Future Development Economics aspects Background Economical competitiveness of wind energy iii

7 4.1.3 Promoting economical development of wind energy Conclusion of wind energy s economical development Political aspects Background Collaboration with China Changing the energy market structure Political instruments to promote wind energy development Setting up a specific authority for renewable energy Conclusion of wind energy s political development Meteorological and geographical aspects Background Development of wind energy on islands Development of wind energy on land Development of wind energy in offshore areas Offshore wind farms as the most feasible option in Hong Kong Conclusion of meteorological and geographical development Comments from power companies 54 Chapter 5 Applicability of wind turbines in Hong Kong s built environment Background Considerations in Hong Kong Suggestions Conclusion of applicability of wind turbines in Hong Kong s built environment 62 Chapter 6 Conclusions References 67 iv

8 Lists of Figures Figure 2.1 Total Installed Capacity (MW) of Wind Energy in the world ( ).. 6 Figure 2.2 Top 10 Cumulative Installed Capacity (MW) of Wind Energy in the world Figure 3.1 Energy Consumption (by Fuels) in Hong Kong ( ).. 11 Figure 3.2 Energy Consumption (by Sectors) in Hong Kong ( ) Figure 3.3 Energy and Electricity Consumption per Capita in Hong Kong ( ).. 12 Figure 3.4 Lamma Winds installed by HEC on the Lamma Island 19 Figure 3.5 Location of the Southwest Lamma Offshore Wind Farm Figure 3.6 Location of the Southeastern Waters Offshore Wind Farm 22 Figure 3.7 An automatic weather station of the Hong Kong Observatory Figure 3.8 A small wind turbine installed by the Hong Kong Observatory. 26 Figure 4.1 Ranges of LCOE of electricity generation technologies in Figure 4.2 Location of Waglan Island Figure 4.3 Areas of rich wind resources on Hong Kong land.. 49 Figure 4.4 Areas of rich wind resources in Hong Kong offshore area. 51 Figure 5.1 Integrated Wind turbines of Bahrain World Trade Center of Dubai Figure 5.2 Figure 5.3 Horizontal-axis small wind turbine mounted on the roof of EMSD Headquarter.. 57 Vertical-axis small wind turbine mounted on the roof of EMSD Headquarter.. 57 v

9 Lists of Abbreviations BAWT CLP EIA EMSD GHG GWEC HEC HKO HKOWL LCOE REFITS RES RPS SEW Offshore Wind Farm SWL Offshore Wind Farm WWEA Building Augmented Wind Turbine China Light & Power Hong Kong Limited Environmental Impact Assessment Electrical & Mechanical Services Department Greenhouse Gas Global Wind Energy Council Hongkong Electric Company Limited Hong Kong Observatory Hong Kong Offshore Wind Limited Levelized Cost of Electricity Renewable Energy Feed-in Tariffs Renewable Energy System Renewable Portfolio Standard Southeastern Waters Offshore Wind Farm Southwest Lamma Offshore Wind Farm World Wind Energy Association vi

10 Chapter 1 Introduction 1.1 Background Electricity is crucial to Hong Kong for supporting various kinds of activities everyday, and electricity is mainly generated by combustion of coal in Hong Kong (Chan, 2003). Burning of coal, which is a kind of fossil fuels, will cause air pollution problem and lead to global warming. Fossil fuels are also non-renewable that will be depleted in near centuries. In order to mitigate these adverse effects and solve the imminent energy crisis issue, each country bears the responsibility to seek new energy sources and improve their present energy sources quality, one of the ways is to replace fossil fuels with renewable energy. Renewable energy is energy source that is renewable and will not be depleted, and usually produces no pollution, therefore it is regarded as one of the best solutions to cease global warming and energy crisis caused by fossil fuels. While renewable energy has to compete with conventional energy sources inevitably, those renewable energies that have huge and renewable raw materials will have advantages in the long run (Sahin, 2004). Among different kinds of renewable energies, wind energy is one of the most promising energy sources, that is becoming widely used around the world. For example, wind power has taken up to 20%, 8% and 7% respectively of total power consumption in Denmark, Spain and Germany (GWEC, 2009). It is imminent for Hong Kong to develop wind energy and increase its proportion in electricity generation. Not only it can contribute to a greener 1

11 environment and combat global warming, but also to support increasing population size, secure energy supply and mitigate boosting of fuel prices. However, due to limited land, hilly topography and other obstacles, current development of wind energy in Hong Kong is limited and mainly serve as educational and demonstration purposes. In order to reduce reliability on fossil fuels and to combat climate change, Hong Kong should explore its potential in developing wind energy. 1.2 Objectives and methodology The objectives of this project are to investigate current progress of wind energy in Hong Kong, study wind energy s future development in Hong Kong and to explore the potential of wider wind energy applications in Hong Kong. The methodology adopted in this project includes information collection through internet, textbooks, journals and government publications. Comments and data were also collected from power companies and government departments. 1.3 Structure of the thesis Seven chapters will be included in this thesis. Chapter 1 briefly describes the necessity of developing renewable energy, gives an brief overview of wind energy in Hong Kong and in the world. Objectives and structure of the report of the project are highlighted. Chapter 2 is a literature review, summarizing other researches and statistics done previously on wind energy development in the world and in Hong Kong. 2

12 Chapter 3 describes current progress of wind energy development in Hong Kong. Energy market and energy policy in Hong Kong are also investigated. Chapter 4 is a detailed study on future development of wind energy in Hong Kong. Development in four aspects: economical, political, meteorological and geographical are described. Suggestions are proposed for each aspect to assist wind energy development. Comments from local power companies were also collected and evaluated. Chapter 5 is an assessment of another potential application of wind power in Hong Kong, i.e. wind turbines in the built environment. Chapter 6 is a conclusion of this project with recommendations on wind energy development in Hong Kong. 3

13 Chapter 2 Literature Review 2.1 Wind energy as a renewable energy When solar radiation is absorbed by the earth, land surfaces are heated up unevenly. Water and lands under clouds are heat up slowly, while lands exposed directly to sunlight heat more quickly. The air above hotter land surfaces will be heated up and rise, creating a low pressure area. The pressure gradient causes air to move from high pressure area to low pressure area, and this horizontal movement of air is called wind. Wind speeds at a given location always vary, and the variation is affected by meteorological, geographical and environmental factors (Walker, 1997). Wind turbines are devices necessary to convert kinetic energy of wind into electrical power. Blades of wind turbines are rotated due to wind forces, and the rotational motion is transmitted to electrical power through a generator. The wind turbines can be connected to a premise or even grid connected to the electricity network of a region, therefore, not only can it provide electricity for separate premises, but also even supply electricity for cities, provinces or states. The kinetic energy of a wind mass is proportional to the cube of the wind speed, so wind speed at the location of wind turbine is critical to the power output and cost-effectiveness of the turbine (EMSD, 2002). As a commonly adopted renewable energy, wind energy possesses many advantages. It is clean, indigenous and free, produces no air pollution and greenhouse gas (GHG) so can combat climate change. It acts as a substitute of fossil fuels and 4

14 can slow down the depletion rate of fossil fuels thus mitigating energy crisis. Prices volatility of fossil fuels can be hedged, and conflict over natural resources can be prevented (Saidur et al. 2010). These advantages stimulated rapid development of wind energy all over the world in recent decades, making wind energy to become an important solution to tackle climate change. However, some disadvantages of wind energy should be taken into consideration in practical operation. For example, a major consideration is that wind speeds at a location always vary, therefore the power output of wind energy is not constant, which is different from stable energy supply from conventional fossil fuel (Sahin, 2004). In order to minimize the power intermittent problem, determination of wind energy potential is necessary before wind energy projects, which includes detailed and comprehensive measurement on meteorological conditions, wind direction, velocity, and solar irradiation, etc. But in many parts of the world, it is difficult to obtain such data. Redlinger et al. (2002) also listed several conditions to be considered, such as the need of additional electricity production capacity, economic competitiveness compared to conventional fossil fuels, incentives for development and application of renewable energy, etc. It is necessary to maximize benefits of using wind energy while minimizing its costs and drawbacks, to increase its application all over the world. 2.2 Wind energy development in the world Wind energy technology first appeared in the world 3000 years ago. In 5000BC, it was first used for boat navigation on the Nile River. Since then wind power technology developed gradually, being widely used to provide mechanical power to 5

15 Installed Capacity (MW) The University of Hong Kong pump water or to grind grain. The first wind turbine for electricity generation was developed at the beginning of the 20 th century, and the technology has been improving rapidly until now, making wind energy being more competitive with other energy sources (Ackermann & Soder, 2000). According to World Wind Energy Association (WWEA), worldwide wind energy capacity grew substantially in past ten years, as shown in Figure 2.1. Wind capacity doubles every three years and has reached 159, 213 Megawatt (MW) in All wind turbines worldwide are generating 340 TWh per annum, an amount equal to the total electricity demand of Italy, and equivalent to 2 % of global electricity consumption. Wind energy also contribute significantly to the world economy, the sector in 2009 had a turnover of 50 billion, and employed 550,000 people worldwide (WWEA, 2009). Total Installed Capacity (MW) of Wind Energy in the world ( ) 160, , , , Year Figure 2.1 Total Installed Capacity (MW) of Wind Energy in the world ( ) Source: World Wind Energy Association (WWEA),

16 Figure 2.2 is the statistics of Global Wind Energy Council (GWEC), which shows the cumulative installed capacity of wind energy in different countries in It can be seen that USA, China and Germany are the three countries with highest installed wind capacities, which make up 22%, 16% and 16% of the total world installed capacity. More than seventy countries have adopted wind energy, and the number is believed to increase gradually. Development of wind energy is optimistic and it is predicted that the global capacity may reach 1,900,000 MW in 2020 (GWEC, 2009). Top 10 Cumulative Installed Capacity (MW) of Wind Energy in the world 2009 Denmark 2% Portugal 2% UK 3% Rest of world 13% U.S 23% France 3% Italy 3% India 7% China 16% Spain 12% Germany 16% Figure 2.2 Top 10 Cumulative Installed Capacity (MW) of Wind Energy in the world 2009 Source: Global Wind Energy Council (GWEC),

17 2.3 Wind energy development in Hong Kong In 2002, the Electrical & Mechanical Services Department (EMSD) issued the report Study on the Potential Applications of Renewable Energy in Hong Kong - Stage 1 Study Report, which is the first official detailed study to analyze wind energy application in Hong Kong. The report showed that Hong Kong possesses satisfactory wind resource in both urban and rural areas, the resources potential is significant that minimum 2 TWh and 7.6 GWh can be generated per year respectively. However, practical application of wind energy is not easy in Hong Kong, mainly due to lack of undeveloped flatland for wind farms. Other barriers should be overcome, such as noise, safety, vibration impact, etc. (EMSD, 2002). Wind resource in Hong Kong is also studied by some other researchers. Lu et al. (2002) established a simulation model to analysis local weather data and typical wind turbine characteristics, and showed the great potential for wind power generation on the islands surrounding Hong Kong. Li (2000) also performed a preliminary study on the potential and the feasibility of offshore wind energy in Hong Kong. A hypothetical wind farm is sited on the east side of the waters, and it is found that the moderate wind resource provide enough energy for the wind farm to generate 6% of annual electricity demand in Hong Kong. Although these studies have proved that wind resource in Hong Kong is satisfactory, wind energy development in Hong Kong is immature. The first development of wind energy in Hong Kong can be said to start in February 2006, when the first commercial-scale wind turbine, installed by the Hongkong Electric Company Limited (HEC), was inaugurated on the Lamma Island in Hong Kong. 8

18 (HEC, 2010b). Besides, some small wind turbines with rated power about 1 kw to 3 kw, were installed in different locations, such as automatic weather stations of Hong Kong Observatory, EMSD Headquarters, etc. These small wind turbines also serve as promotional purpose to educate public on renewable energy, the electricity they produce is insignificant (EMSD, 2007). 9

19 Chapter 3 Energy Overview and Current Status of Wind Energy usage in Hong Kong 3.1 Energy overview in Hong Kong Energy consumption in Hong Kong Hong Kong has an area of 1098 km 2 with population about 7 millions. Nearly 80% of the land is hilly and not suitable for residential use, therefore population density in Hong Kong is very high (Hui, 2003). Enormous amount of energy is required to support the large population in Hong Kong. As shown in Figure 3.1, the total amount of energy used in Hong Kong in 2008 is 285,430 TJ, which is produced from three types of fuels: town gas and liquefied petroleum gas, oil and coal products, and electricity. Among these fuels, electricity took up the largest proportion and produced about 52%, i.e. 147,345 TJ of the energy. Also, during the past ten years from 1999 to 2008, proportion of electricity keeped increasing, its proportion in energy consumption increased from 47% to 52%, while consumption of oil and coal gradually decreased from 43% to 33%. (EMSD, 2010). Figure 3.2 shows the energy consumption of different sectors from 1999 to Among the four sectors in Hong Kong, energy consumption by commercial sector increased every year steadily, and is now the sector that consumes most energy, taking about 39% of total energy consumption. Although residential sector consume less energy than transport sector, its consumption is increasing gradually as like the commercial sector, and now is taking 19% of the total energy consumption (EMSD, 10

20 Energy Consumed (TJ) Energy Consumed (Terajoule) The University of Hong Kong 2010). Energy Consumption (by Fuels) in Hong Kong ( ) 300, ,000 Electricity 200, , ,000 Oil & Coal Products Town Gas & Liquefied Petroleum Gas (LPG) 50, Year Figure 3.1 Energy Consumption (by Fuels) in Hong Kong ( ) Source: Electrical & Mechanical Services Department (EMSD), ,000 Energy Consumption (by Sectors) in Hong Kong ( ) 250,000 Transport 200, ,000 Industrial Commercial 100,000 Residential 50, Year Figure 3.2 Energy Consumption (by Fuels) in Hong Kong ( ) Source: Electrical & Mechanical Services Department (EMSD),

21 Energy / Electricity Consumed (GJ/Capita) The University of Hong Kong Figure 3.3 shows the energy and electricity consumed per capita in Hong Kong from 1999 to In this period, the population in Hong Kong has risen by 6.6%, energy consumption per capita keeps almost unchanged, but electricity consumption per capita has increased by 11.3%. (EMSD, 2010). 50 Energy and Electricity Consumption per Capita in Hong Kong ( ) Energy consumption per capita Electricity consumption per capita Year Figure 3.3 Energy and Electricity Consumption per Capita in Hong Kong ( ) Source: Electrical & Mechanical Services Department (EMSD), 2010 From Figure 3.1, it can be seen that both energy and electricity consumption are steadily increasing in the past ten years, and demand on electricity is particularly strong. The total amount of energy and electricity consumed is increased by 6.3% and 17.5% respectively. While in Figure 3.2, commercial sector and residential sector totally take up about 58% of energy consumption in Hong Kong, and their consumption are both increasing. It is concluded that the increasing energy consumption in Hong Kong is mainly due to increasing populations and growing 12

22 economy, and energy is mainly used in buildings and premises for commercial and residential purposes. The above figures provide evidence that electricity demand in Hong Kong continue to rise. In order to catch up with the demand and at the same time prevent further pollution to the environment, it is necessary to develop renewable energy as soon as possible. Wind energy produce no GHG during operation, it is clean and free. Also, since wind turbines can be grid-connected to the electricity networks in Hong Kong, electricity produced from wind energy can be distributed efficiently to all over Hong Kong, as like the conventional energy. Therefore wind energy is one of the mostly preferred renewable energy in Hong Kong and worth consideration Energy market structure in Hong Kong Hong Kong has no indigenous energy resources, and all energy sources are imported from overseas. Currently, electricity in Hong Kong is supplied by two investor-owned companies, namely the China Light & Power Hong Kong Limited (CLP) and the Hongkong Electric Company Limited (HEC). Their electricity networks cover different areas which do not overlap with each other. CLP supplies electricity to Kowloon, the New Territories, Lantau Island and most outlying islands, covering about 80% of the population in Hong Kong. HEC serves the Hong Kong Island, Lamma Island and several surrounding Island. Both power companies use coals as the main fuels which make up about half of the total fuels consumption, but have gradually increased the proportion of natural gases in recent years (ENB, 2011b). 13

23 3.1.3 Energy policy in Hong Kong Policy Objective Energy policy in Hong Kong aims to ensure that the energy needs of the community are met safely, reliably, efficiently and at reasonable prices, and to minimize the environmental impacts of energy production, to use and promote the efficient use and conservation of energy (ENB, 2011b). Policies supporting Renewable Energy The government s first policy initiative to promote renewable energy in Hong Kong is the promulgation of the First Sustainable Development Strategy for Hong Kong in May In the strategy a target is set of having 1-2% of Hong Kong s total electricity supply met by renewable energy by 2012 (Sustainable Development Unit, 2005). Another policy instruments to support renewable energy in Hong Kong is the Scheme of Control Agreements (SCA) It was an agreement signed by the government and the two local power companies, and through SCA the government can monitor the performance of the power companies. Its objectives are to ensure that the power companies provide a reliable, safe and efficient electricity supply to the consuming public at a reasonable price, and that the shareholders of the companies can obtain a reasonable return on their investment (ENB, 2011a). In the previous SCA that have already expired on 2008, there was no any environmental related clause included, so it was commonly criticized for being ineffective towards environmental protection (Chan, 2003). In regard to this, the 14

24 government seems to have absorbed public comments and have incorporated environmental incentives in existing SCA ( ) to encourage power companies for adopting renewable energy. The permitted rate of return for the power companies includes 11% of the average renewables net fixed assets, while the company's average net fixed assets, which is also included in the permitted rate of return, was dropped from 13% in previous SCA to 9.99% in the existing SCA (ENB, 2011a). Evaluation on current policy in Hong Kong As an economic incentive, the existing SCA encourage power companies to develop renewable energy, because they can have a higher permitted rate of return if they increase their generation capacity from renewable energy facilities. Decrease of permitted rate of return from average renewables net fixed assets further encourage them to switch to renewable energy in order to get higher profit. The existing SCA is theoretically effective, as a win-win situation can be achieved: power companies and investors can get a higher permitted rate of return, while the government can fulfill its target of having 1-2% of Hong Kong s total electricity supply met by renewable by Furthermore, after the existing SCA was signed in 2008, the two power companies are developing large scale offshore wind farms in Hong Kong as substantial support to the renewable target, which will be discussed in Chapter 3.2. But to a certain extent, the existing may not be not effective enough to encourage renewable energy developments. The permitted rate of return for average renewables net fixed assets is 11%, which is only 1% higher than the return for 15

25 average net fixed assets. Since renewable energy is comparatively immature in Hong Kong, its development requires much human, technical resources and capital investments, and this relatively small amount of increased return may not be attractive enough to power companies to invest vast amount of efforts. Furthermore, benefits of renewable energy investment usually evolve in long term. The payback period of investment is an important factor affecting companies willingness in developing renewable energy, they may take more serious considerations on capital-intensive technology such as wind power, but this issue seems have not been mentioned in the SCA. There is no specific policy in Hong Kong assisting wind energy development. Moreover, Hong Kong s policy supporting renewable energy is quite insufficient, which SCA can be said to be the only policy instrument supporting renewable energy development. In foreign countries which renewable energy is developing satisfactorily, such as Denmark, U.S.A., Germany, etc., adequate policy instruments are implemented effectively (Saidur et al., 2010; Sharman, 2005; Lee, 1998). Therefore lack of policy supports may be one of the reasons of immature development of wind energy in Hong Kong. Government s effort on political support of wind energy is crucial for development. 3.2 Current status of wind energy usage in Hong Kong Background It is mentioned in Chapter 2 that, wind energy is one of the best renewable energy applied all over the world. In Hong Kong, wind energy also has more advantages than other renewable energy technologies. There is no water resources 16

26 capable of running a hydro-electric station, using solar energy by solar photovoltaic panels is too expensive, and ocean power technology is still under development. So wind energy is comparatively more suitable to be developed in Hong Kong (CLP, 2007). However, limited land in Hong Kong is one of the major obstacles for wide-scale application of wind energy, and attribute to limited development at present. Urban area is so densely populated and packed with tall buildings, while rural areas and county parks are important to the community that land use change is not possible. Therefore, large scale wind development in term of onshore wind farm in Hong Kong is extremely difficult (CLP, 2007). In order to evaluate current progress of wind energy development in Hong Kong, some important wind projects at present and in the future are discussed below The wind turbine installed on Lamma Island Lamma Winds Lamma Winds is the first commercial-scale wind power station in Hong Kong, which is a single wind turbine installed by Hongkong Electric (HEC) on the Lamma Island. HEC started to explore the feasibility of utilizing wind as renewable energy in 2000, and commenced wind monitoring programme at Po Toi and Lamma Island in April, 2001 to study the wind resources is these places. The Environmental Impact Assessment (EIA) Report for Lamma Winds was approved by the Environmental Protection Department (EPD) in October 2004, and after one year of construction, Lamma Winds started commission in February 2006 (HEC, 2010b). Figure 3.4 gives an outlook of Lamma Winds. It is an individual wind turbine, having a typical configuration of horizontal axis design, three rotor blades and is stall-regulated, mounted up-wind, with rotor diameter of 50m and total tower height 17

27 of 46m. Its rated power is 800 kw which is a standard capacity, reliable and is widely used in the world. By the end of February 2010, Lamma Winds has generated more than 3.6 million kwh of electricity, meaning that 1,250 tonnes of coal consumption and more than 3,000 tonnes of carbon dioxide emissions have been avoided (HEC, 2011). Lamma Winds is connected to the electricity network and can provide electricity to Hong Kong, but its output is insignificant. It only provides approximately 0.002% of total electricity per year in Hong Kong. However, one of its main objectives is not producing power only, but acts as a pilot project to acquire knowledge in the design, construction and operation of wind turbine, and educate the public on the benefits and limitations of using wind energy for power generation in the context of Hong Kong s special situations. Lamma Winds act as an important milestone of renewable energy development in Hong Kong. Not only was it the first commercial-scale wind power station in Hong Kong, but it also sparked public concerns and interests on renewable energy. It serves quite well on the educational and promotional purposes, featuring an Exhibition Centre which introduces the station as well as major types of renewable energy and their applications in Hong Kong and other parts of the world (HEC, 2010b). Besides, after Lamma Winds commission, field data and practical issues on wind energy technology, which is insufficient in Hong Kong, can be collected and play an important role in later offshore wind farms development in Hong Kong. 18

28 Figure 3.4 Lamma Winds installed by HEC on the Lamma Island Source: Hongkong Electric Company Limited (HEC), 2010b Southwest Lamma (SWL) Offshore Wind Farm After the commissioning of Lamma Winds, HEC started to determine the feasibility of developing an offshore wind farm in Hong Kong, in order to increase the generation capacity of renewable energy in Hong Kong. A site selection study was carried out in 2008 to select a preferred site for development. The EIA study has reviewed the environmental efficiency of eight potential sites, and then an area at southwest Lamma waters is considered to be the best location for the offshore wind farm. Figure 3.5 shows the location of the SWL Offshore Wind Farm and the wind turbines distribution. The SWL Offshore Wind Farm is located in the waters between Lamma Island and Cheung Chau, with closest distance from the site to Lamma Island approximately 3.5 km (HEC, 2010a). The EIA report of the SWL Offshore Wind Farm was approved in May Now HEC is carrying out wind monitoring work at the site to collect wind resources data, and the offshore wind farm is scheduled for completion by 2015 (HEC, 2010c). 19

29 Figure 3.5 Location of the Southwest Lamma Offshore Wind Farm Source: Hongkong Electric Company Limited (HEC), 2010a Around 28 to 35 wind turbines with rated power 2.3 to 3.6 MW will be constructed in the proposed SWL Offshore Wind Farm. Number of wind turbines will depend on the rated power chosen, for example, about 28 wind turbines will be constructed if turbines with higher rate power of 3.6 MW is chosen, so that the wind farm capacity will be maintained at around 100 MW. The 100 MW capacity can generate about 170 million kwh per year, which is roughly about 1.6% of HEC s total electricity generated in 2008, and 0.4% of total electricity consumption of Hong Kong in the same year. About 62,000 tonnes of coal and 150,000 tonnes of carbon dioxide emission can also be offset (HEC, 2010a). HEC stressed that after considering different factors, the site is analyzed to be the best locations, and all environmental impacts related to the construction will also be minimized or negligible (HEC, 2010c). As the construction of SWL Offshore Wind Farm will be the first massive project carried out on the sea, it is suggested that 20

30 careful and rigorous auditing and monitoring works must be conducted, to ensure environmental compliance of the construction project. HEC s construction of the SWL Offshore Wind Farm aims to support government s policy on renewable energy, its capacity is able to supply electricity equivalent to half of the renewable energy target, i.e. 0.5%, set by the government. Besides, commission of the Lamma Winds provides important experience on practical implementation and possible improvements of commercial-scale wind energy, which is very insufficient in Hong Kong. These experiences, together with wind data collected currently, can optimize operational efficiency and energy output of the wind farm. Therefore, with careful monitoring works in construction and minimization of ecological impacts, the SWL Offshore Wind Farm is believed to be beneficial to Hong Kong in the long run Southeastern Waters (SEW) Offshore Wind Farm Wind Prospect is an integrated international wind energy company, its 100% subsidiary, the HK Offshore Wind Limited (HKOWL), has started a feasibility study of building an offshore wind farm in Hong Kong since 2005, and CLP joined the study as a partner in 2006 (CLP, 2009). In the site selection process which was mentioned by CLP as the most important part of the study, a Geographic Information System (GIS) was used to identify preferred site for the offshore wind farm. After different factors, such as ecological constraints, wind resources, shipping lanes, etc. were taken into consideration, it was shown by the GIS that an area in the southeastern region is comparatively constraint-free and is the best site for development. Figure 3.6 illustrate the project location, the proposed SEW Offshore Wind Farm is 21

31 approximately 9 km and 5 km east of the Clearwater Bay Peninsula and East Ninepin Island respectively (HKOWL, 2010). The EIA report of the SEW Offshore Wind Farm was approved in August As like the SWL Offshore Wind Farm proposed by HEC, currently CLP and HKOWL is collecting field wind and wave data using a wind mast installed at the proposed site, and a full business case may be available for assessment by Figure 3.6 Location of the Southeastern Waters Offshore Wind Farm Source: HK Offshore Wind Limited (HKOWL), 2010 The proposed SEW Offshore Wind Farm occupies an area of 16 km 2 and has a capacity of 200 MW. Up to 67 wind turbines, each with rated power 3 MW, will be erected in the proposed offshore wind farm. It was suggested in the EIA report that 40 wind turbines each with 5 MW can also be an option, which both scenario will generate approximately the same power and occupy same total sea area. The total capacity of the wind farm will be approximately 200 MW, which can produce about 22

32 1% of total Hong Kong electricity needs in 2008, supporting 80,000 households, and roughly 343,000 tonnes of carbon dioxide emission can be avoided (HKOWL, 2010). The SEW Offshore Wind Farm s capacity is a double of the SWL Offshore Wind Farm s. It will produce electricity about 1 % of total electricity demand in Hong Kong, therefore it can be a substantial contributor to the renewable energy target set by the government. It is mentioned in the EIA report that the turbine substructure can offer the opportunity for artificial reef development, restriction of maritime traveling around the SEW Offshore Wind Farm can also contributes to sustainable fisheries management in Hong Kong (HKOWL, 2010). The SEW offshore wind farm may also act as a new landmark in Hong Kong, promoting ecotourism and renewable energy education. However, the project was criticized by some parties. For example, the proposed site is only 3km away from the Geopark, so the scenic and ecological value of the Geopark may be damaged by those giant wind turbines. Furthermore, the expected life span of the wind turbines is about 20 years, which is accused to be too short. It is suggested that comprehensive public engagement should be involved in all phases of the project and transparency of the project should also be increased, enabling the public to understand the pros and cons, and the necessity of the project. Consultations and further studies are required before the construction, to ensure that Geopark will not be negatively affected Small wind turbines Small wind turbines refer to those turbines with rated power from 100 W to tens of kw. In contrast to large wind turbines such as the Lamma Winds, small wind turbines may not be grid-connected to the electricity networks, their main application 23

33 is for charging batteries to function as a stand-alone power supply system. When used in conjunction with PV panels, it can provide electricity to small premises or devices, which require small amount of energy for functioning. Some small wind turbines may be installed on rooftop, which are grid-connected to the electricity network to provide electricity to the building or a whole region (EMSD, 2007). One advantage of these grid-connected wind turbines is the stable energy supply, wind energy in this case act as a supplementary electricity source to reduce overall fossil fuels consumption. A good example of small wind turbines usage in Hong Kong is the Hong Kong Observatory (HKO), which takes up a large share in small wind turbines applications in Hong Kong. Wind energy has been used by HKO since 2000 to operate a number of automatic weather stations in various locations. These stations provide real-time weather information to support weather monitoring and forecasting, they operate 24 hours and require stable electricity supply. However, some of these stations are located in remote areas or islands that grid-electricity is not available, while rely on solar energy solely may lead to failures of stations due to insufficient power when sunshine is not adequate for a prolonged period. So HKO has installed some small wind turbines to make up hybrid wind-photovoltaic DC power supply. In hilly and exposed places where those stations are located, the small wind turbines can generate 50W of electrical power which is sufficient to support the stations. Nowadays, small wind turbines have been deployed at eight automatic weather stations, and their performance is very satisfactory. Figure 3.7 and 3.8 show the automatic weather stations and the small wind turbines used by HKO respectively (HKO, 2009). Other examples of small wind turbines application can be shown on the roof of EMSD Headquarters building and Marsh Road Station Building of HEC, where 1kW and 2.5kW small wind turbines are installed and grid-connected to the electricity 24

34 network respectively. A 760kW small wind turbine is also installed at Queen's College Old Boys' Association Secondary School to provide power for irrigation and lighting equipment (EMSD, 2007). Small wind turbines technology is still immature in Hong Kong, currently they serve mainly as research and demonstration purposes. Consideration for their application is different from large wind turbines. For example, they have small size and sometimes installed in urban area, so their ecological impact is usually negligible, but they produce power at a higher unit cost than that electricity from large wind turbines due to small scale application. They also turn faster and hence produce more noise than large turbines. Another consideration is the difficulty to decide whether a site is suitable for installing a small wind turbine. Due to the complex topography in Hong Kong, actual wind measurement for a long period is quite difficult, therefore an accurate energy yield prediction cannot be easily obtained. Deciding whether a location is suitable for small wind turbines usually depends on some informed judgments, and the actual energy yield may turn out to be much lower or higher than expected (EMSD, 2007). On the other hand, due to their smaller sizes, small wind turbines are not limited by geographical constraints in Hong Kong. They have potential in wide-scale application and their penetration can be deep in an urban city. More experience in Hong Kong and overseas needs to be gathered for the technology to boost its development.. 25

35 Figure 3.7 An automatic weather station of the Hong Kong Observatory Source: Electrical & Mechanical Services Department (EMSD), 2010 Figure 3.8 A small wind turbine installed by the Hong Kong Observatory Source: Electrical & Mechanical Services Department (EMSD),

36 Chapter 4 Future Development of Wind Energy in Hong Kong 4.1 Economical aspects Background There are four parameters governing wind power costs, which are capital costs, operation and maintenance (O&M) costs, the electricity produced and the discount rate, and also the economic lifetime of the project investment (Blanco, 2009). Wind power is usually regarded as capital-intensive investment, because capital costs at the starting time can be as much as 80% of the total cost of the project over its entire lifetime. It is important to know that the cost of wind power per kwh produced does not only include the capital costs and variable costs, but also takes into account the wind resources which determine the electricity produced, therefore comparisons can be made between wind energy and other electricity generating technologies. In studying economical development of wind energy, it may be helpful to have a glance on the trend of wind energy costs. As there are many components included in wind energy costs, the costs keep changing with time. For example, it is shown in a study that onshore wind energy costs have decreased by 75% from 1999 to 2005, but then increased by 10% from 2005 to 2007 (Snyder & Kaiser, 2009). It is predicted that the increased costs are due to suddenly boosted number of wind farms and wind turbines, which cause increased price of raw materials of wind turbines. 27

37 LCOE (USD $ / MWh) The University of Hong Kong Economical competitiveness of wind energy The levelized cost of electricity (LCOE) has been used to compare the unit costs of different electricity generating technologies over their economic lives. Its calculation comprises life cycle cost approach and uses net present value calculations, therefore it differs significantly between capital and O&M costs, but it better represent the generation costs of different technologies. European Commission (EC) has done a study in 2008 to investigate the production costs of various electricity generating technologies, the result is summarized in Figure 4.1. Considering lower bound of costs, it is shown that costs of both onshore and offshore wind energy are both higher than conventional energy sources such as coal and gas by about 80%. When compared with other renewable energies, wind energy cost is higher than hydropower by about 100%, but much lower than solar photovoltaic by 550%. 1,200 Ranges of Levelized Cost of Electricity (LCOE) of electricity generation technologies in , Nuclear Pulverlised coal gas biomass onshore wind offshore wind 240 hydro 45 solar PV Figure 4.1 Ranges of LCOE of electricity generation technologies in 2008 Source: European Commission (EC),

38 The above figure showed that wind energy costs are higher than conventional energy sources and some renewable energies, but with consideration of some other factors, wind energy can be economically competitive with other technologies in the future. Firstly, it should be noted that the LCOE should be used as a reference, as costs of electricity vary in many aspects and actual prices of each technologies can hardly be found. A major determining factor is the location concerned, as different locations with different policies and resources can greatly affect the prices of electricity generating technologies. In locations with sufficient wind resources, wind energy generated is higher and the costs thus decrease, and the costs difference can be very high. Because Hong Kong s wind resource can be sufficient for cost-effectiveness utilization of wind energy (which will be discussed in Chapter 4.3), with appropriate site selection of wind farm, detailed wind resources studies and choosing wind turbines which are most effective in the available wind resources, etc. wind energy is economically competitive with other technologies. Secondly, a distinct advantage of wind energy is that it has obviously no fuel cost, which is also its fundamental difference with most conventional electricity generation technologies. Not only long term fuel costs are avoided, but also various effects caused by fluctuating fossil fuel prices can be prevented. For instances, in a natural gas power plant as much as 60% of the costs are related to fuel and O&M costs, whereas the costs are about 10% for an onshore wind farm (Blanco, 2009). It is no doubt that the rising price of global fossil fuel in recent years may imply an increasing competitive advantage of wind energy in the future. Thirdly, when compared to other technologies, wind energy possesses low external costs which are costs of impacts caused to the environment due to the pollutants emitted from the specified technology. The costs are proportional to the 29

39 electricity generated and can be long term, which appear gradually and may not be easily noticed now, but they may have great impacts in the future. Although the costs cannot be quantified easily, it can be enormous and should not be overlooked. A study has shown that wind energy is the cheapest among all kinds of electricity generation technologies when considering externalities, since it does not require fuel and emit no pollutant (El-Kordy et al. 2002). As global warming is an imminent problem, this advantage will definitely become more outstanding. Although it is mentioned before that wind energy costs have increased in previous few years, the costs are predicted to fall in the near future. Based on the experience curve which states that lower costs can be attained when more tasks are performed, it is projected that wind energy unit costs may reduce by 9% to 17% when the total installed capacity doubles, due to improved technology, standardization, labour efficiency and competitions between wind turbines manufacturers etc. Also, once the supply chain bottlenecks are resolved, raw materials price is believed to drop so wind energy cost is expected to decrease (Blanco, 2009). This decrease of wind energy costs is worldwide and wind energy development in Hong Kong can take the advantages. Therefore, with consideration of different factors and with appropriate supportive measures, wind energy is economically competitive with other technologies in the future Promoting economical development of wind energy Although wind energy can be economically competitive in the future, its generation costs are currently higher than other conventional technologies. Certain measures are helpful for boosting economical developments of wind energy. 30

40 Research and Development (R&D) Analyses have shown that the level of R&D for both public and private aspects can affect future wind energy costs significantly (Blanco, 2009), because the level of capital cost largely depends on the availability and quality of raw materials. For R&D in global scale, countries and wind turbines manufacturers can develop more cost-effective technologies and explore better, cheaper raw materials. For Hong Kong, it may be impossible to influence the raw materials, but efforts in R&D can be in terms of putting resources on wind data collection and analyzes, wind studies, etc. For example, the government can provide funding for wind study projects and cooperate with universities to develop a comprehensive and updated wind resources map, potential wind utilization locations can also be explored through feasibility studies. These studies can explore locations in Hong Kong that is cost-effective for wind power application thus increasing its economic competitiveness. Besides, offshore wind technology is newer thus the rate of learning and advancement is relatively high. As there are enormous rooms for offshore wind technology improvements and offshore wind is becoming more popular worldwide, R&D is important to stimulate economic improvement of offshore wind, especially for Hong Kong where offshore wind is one of the most feasible applications of wind energy. Promoting economical advantages of wind energy Economies of scale can also decrease the level of capital costs of wind energy, so lower unit costs of wind energy can be achieved by larger-scale facilities or production process. Measures to support installations of large-scale facilities can be 31

41 done in Hong Kong, one of these is to promote wind energy to financial sectors. Since 80% of total cost is necessary at start, financial loans are usually required for developers to begin the project, and some projects may be halted due to lack of capital. Some awareness-raising campaigns or seminars can be held to explain to financial sectors the benefits of wind energy investments, and encourage them to fund more wind energy projects at lower interest rates. For example, one economical advantage of wind energy is that after the installation process, the wind energy generation cost can be predicted accurately if wind measurements are correctly calculated (Blanco, 2009). Therefore good repayment conditions can be achieved with higher certainty and risk to investors is low. Many successful overseas cases such as Denmark, Germany, China and U.S. can also be taken as examples to increase their confidence. Why Wind Power? Advantages of wind energy over other renewable energies The comparative advantages of wind energy over other renewable technologies can also be promoted in Hong Kong, so as to attract investments and boost up wind energy. Solar energy, as mentioned above or in other studies (DeCarolis & Keith, 2006; Kennedy, 2005; Sims et al. 2003), is usually the most expensive option, due to its complicated technologies and raw materials. Its generation costs are higher than other renewable energy technologies by several times, and the costs are expected to maintain at high level in near future, the expensiveness has greatly limited its development. Nuclear power, although can be cost-competitive with wind energy, possess serious safety issues and always raise local opposition. Especially after the outbreak of Fukushima nuclear hazard in Japan recently, the safety concern is too large and 32

42 development of local nuclear plant in Hong Kong is impossible in the near future. Although Hong Kong can invest in developing nuclear power in PRD which the power can be transported back to Hong Kong, nuclear power requires fuels and special treatment is required to dispose the fuels properly. This cost should not be overlooked and the long term costs can be much higher than wind energy. Energy-from-waste is an option that can generate considerable amount of energy, but waste is required as fuels and costs are necessary to dispose the product after combustion of waste. Hydropower and geothermal technology are not applicable in Hong Kong because of local geographical condition. Once suitable sites with sufficient wind resources are selected, wind turbines can be installed quickly and start commission in short time. For Hong Kong, it is the kind of renewable technology most feasible for large scale operation, having low total long term costs and the repayment period can be guaranteed by accuracy. With proper encouragement measures by the government, it has larger economical advantages than other renewable technologies and has greater potential to attract investments Conclusion of wind energy s economical development At present, wind energy is still more expensive than conventional fossil fuels. But when external environmental and social costs are considered, wind energy costs drop a lot and in some cases become cheaper than fossil fuels. Various factors has proved that wind energy costs will drop in the future, and with proper supportive measures in place, comparative advantages of wind energy will increase and make it become competitive with fossil fuels. R&D, economies of scales and government s support are the most important 33

43 factors to drive down wind energy costs. Since wind energy is the type of renewable energy most feasible for local large scale operation, Hong Kong should seek developments in these areas to give wind energy a stronger position in long term. 4.2 Political aspects Background Although there is necessity for use of clean and renewable energies, wind energy application is now immature in Hong Kong. One of the reasons, as raised by some critics, is that the government has not put in enough resources and efforts to develop wind energy. Political support is vital for renewable energy development in every locations, but supportive strategies or policies related to RE is deficient in Hong Kong. While wind resources can generate considerable amount of energy even in a small place like Hong Kong, the government should devote to the development of wind energy. Some political measures and directions of development are suggested below Collaboration with China Wind energy is now growing rapidly in China. In 2009, wind energy installed capacity in China has reached 25,805 MW, which is about 16% of the world s total capacity (GWEC, 2009). In Guangdong, the installed capacity is 569 MW, which is about 2.2% of China s total capacity (Shi, 2009), and some regions such as offshore area possess rich wind resources and have potential for development. As wind energy development is one of the main foci in energy policy in China and different 34

44 supportive measures have been put forward, the installed capacity is expected to grow continuously in the future, making wind energy become more competitive with conventional fossil fuels (Liu & Kokko, 2010; Yu & Qub, 2010). With enormous wind energy potential in China, Hong Kong can seize the chances for cross-border cooperation with China in different ways. Integration of wind energy from Guangdong Province into Hong Kong grid Hong Kong can integrate wind energy from Guangdong or other provinces into Hong Kong s electricity network, or buy their wind energy (FOE, 2002). It can meet local demand of electricity and increase proportion of renewable energy in Hong Kong electricity. This is a complicated political issue requiring negotiation and cooperation between two places, but some experience can be learnt from importation of nuclear-generated electricity from Daya Bay Power Station. For instance, the Hong Kong government, local power companies or wind energy developers can form a joint-venture with Guangdong province to construct and operate wind farms located in Guangdong. Sharing of capital costs can stimulate more wind projects development and decrease risks of each parties, whereas monitoring by a joint-venture can ensure stable electricity supplied to both locations. This can also act as an incentive to stimulate further wind energy development in Guangdong Province because more funds are now available. The CLP has been involving in some wind projects development in China currently, but the energy generated is not supplied to Hong Kong. Further cross-border collaboration can be encouraged for integration of wind energy into Hong Kong grid. 35

45 Roles of Hong Kong in wind energy development of China Electricity shortages occur occasionally in some parts of Guangdong, so skeptics may doubt the possibility of electricity grid integration when Guangdong cannot even produce enough electricity for herself. Hence the most important step is to further increase the wind installed capacity. Hong Kong can participate as different roles in assisting wind energy growth in China. Hong Kong as an international metropolis, owns a healthier financial structure and efficient communication network, therefore it is more attractive to and provide more confidence for foreign investments and technologies. Hong Kong can act as a coordinator and bridge to channel foreign funds into China effectively in order to support various wind energy development projects (Hui & Cheung, 1998). Hong Kong with its unique multi-cultural background, can also act as an intermediary for foreign investors, to facilitate understanding and cooperation between foreign and mainland parties, also to overcome language, customs and cultural barriers. It may be particularly useful when a cross-border joint-venture is formed. In promoting international cooperation in China, Hong Kong can in turn benefit from enriched technological expertise and experience, paving the road for local wind energy development in the future. Economy can also be boosted by increased flow of investments. 36

46 4.2.3 Changing the energy market structure Modifications of the Scheme of Control Agreements (SCA) As mentioned in chapter 3.1.3, Scheme of Control Agreements (SCA) is the major instrument for Hong Kong government to monitor the performance of power companies. Although renewable energy terms have been incorporated in the new SCA starting from 2009, some may criticized that they are not effective enough to encourage renewable energy developments. The permitted rate of return for average renewables net fixed assets is 11%, while the return is 9.99% for average net fixed assets. Among conventional and renewable energy technologies, power companies can only earn 1% more for developing renewable energy technologies but need to invest many human and technical resources; also the Renewable Energy Incentive Factor is only 0.05% at maximum, therefore it may not be attractive enough to the power companies. Some terms in the SCA may be improved to increase the incentives of power companies. The difference of permitted rate of return between conventional and renewable energies can be increased, such as increasing the return for renewables assets and also the Renewable Energy Incentive Factor. Currently the two power companies provided charged grid-connecting services for private parties with embedded Renewable Energy Systems (RES). In the future SCA, bonus can be offered to power companies depending on the grid-connection services they provided. It provides incentives for the power companies to proactively promote RES in the society to earn more bonuses, and in turn provoke more applications of RES. When the bonus can cover part of the grid-connection costs, the charges of the service can be lower to encourage installation of RES by private 37

47 sectors. In the SCA, it may also seek the possibility to limit the extent of growth for average fixed assets. In order to meet the increasing electricity demand, it may be necessary for power companies to build power plants or new facilities to increase the generation capacities in the future. Terms can be set to allocate the percentage of new assets for renewable and conventional technologies, e.g. a minimum of 5% of electricity generated from new assets should come from renewable technologies. Grid-interconnection between CLP and HEC electricity network As mentioned before, integrating wind energy from Guangdong into Hong Kong electricity grid can be a possible option to boost up wind energy, and electricity then will be transmitted to the Hong Kong Island inevitably. However, this transmission may be hampered by the unconnected electricity grids of CLP and HEC. Without a connected network HEC may become isolated and cannot reach the renewable energy from Guangdong. Currently the electricity grids of CLP and HEC are unconnected, sharing of power will occur under very special circumstances. Separation of electricity grids has been blamed for long time as being the main reason for electricity price difference between CLP and HEC networks. Although the government has seen the necessity of grid interconnection in 2000 (FOE 2002), this is a complicated issue and no decision has been taken until now for adopting interconnection. The government should carry out detailed discussion with two companies and may also employ professional consultants to study the feasibility of interconnection. Not only all Hong Kong citizens can enjoy wind energy from Guangdong, the gap of electricity price between the two power companies can also be reduced. 38

48 Considerations of changing the energy market structure The most important principle of energy policy is a stable electricity supply, so suggestions listed above for transformation of energy market structure must be first carefully assessed in details. In particular, the two local power companies will be affected. Their interests and perspectives must be taken into considerations, negotiation must be made with power companies to ensure smooth cooperation, and consultation can be held to collect comments or ideas from various parties and the public. For example, projected electricity consumption of Hong Kong in the future should be as accurate as possible so the percentage of new assets can be correctly allocated and a stable electricity supply can be maintained. The permitted rate of return should also be carefully set so the power companies still can have reasonable returns, while a large burden of electricity bills will not be shifted to consumers Political Instruments to promote wind energy development Situations of many European countries have shown the fact that it is difficult to achieve the targets for electricity from renewable energy and develop renewable technologies without additional policy measures or instruments (Haas et al. 2004). Various kinds of political instruments can be dramatically useful in boosting wind energy developments, some examples that may be potential in Hong Kong are suggested. Carbon Tax Carbon Tax is one of the commonest policy instruments adopted to support 39

49 renewable energy and have been implemented in different countries, such as Sweden, South Korea, Netherlands, etc. with notably successes. The basic principle of Carbon Tax is to internalize the external costs, including environmental and social costs, of fossil fuels. Many analyses have shown that Carbon Tax is a potentially cost-effective method to reduce GHG emissions, therefore its potential to be used in Hong Kong should be sought (Helm, 2005). For implementation in Hong Kong, it may be posed on every unit of electricity produced and consumed in proportion to fossil fuels carbon content. The tax can be shared by greenhouse gas emitters (power companies) and consumers, because both parties should bear the responsibility of the social costs bring out by fossil fuels. By increasing the total costs of fossil fuels, Carbon Tax can address the problem that nobody is facing the social costs of consuming fossil fuels. Carbon dioxide emissions can then be directly reduced and mitigate global warming. The revenue from Carbon Tax can also be used in environmental education, R&D and supporting renewable energy development, etc. Another distinct advantage of this instrument is that it greatly increases the competitive advantages of renewable energy technologies such as wind energy. Because wind energy has extremely low external environmental costs, Carbon Tax can significantly reduce the current gap of prices between fossil fuels and renewable energies. Besides, as the tax is proportional to the carbon content, it will drive the use of cleaner and less polluting fuels such as natural gas. Renewable Energy Feed-in Tariffs (REFITS) In REFITS, grid access and a premium price for the electricity produced by renewable energy technologies are guaranteed to renewable energy developers by a 40

50 long term contract. These contracts are usually offered in a non-discriminatory basis to all interested renewable energy developers, whereas the tariff rates guaranteed are dependent on the type of renewable energy technologies concerned and investors can obtain reasonable return on their renewable energy investments. For instance, in Germany, 90% of the price of electricity generated by a wind plant is guaranteed to the renewable energy developers for 20 years (FOE, 2002). As like Carbon Tax, REFITS has been adopted widely worldwide. It is mentioned by the European Commission (EC) in 2008 that, a well-adapted feed-in tariff strategy is generally the most efficient and effective support schemes for promoting renewable electricity. But some supportive measures such as low-interest loans and regional tax incentive should be used together, or REFITS alone may not be strong to support wind projects investments (EC, 2008). Renewable Portfolio Standard (RPS) RPS is another instrument adopted widely to support renewable energy. A minimum amount of renewable power is set whereas power companies are obligated to supply that amount of electricity, and power companies can generate the electricity by itself or can buy it from renewable energy developers. It is a market-based mandate, so its application and fund distribution totally rely on the private market. The role of government is now limited to verifying whether power companies has produced the preset minimum amount of electricity (Espey, 2001). One of the strengths of RPS is that it can initiate price competition between renewable energy technologies and conventional technologies. Through this way efficiency and technology innovation can be stimulated to produce renewable energy at the lowest cost, therefore increasing its competitiveness against fossil fuels (FOE, 41

51 2002). Choosing policy instruments for Hong Kong Among REFITS and RPS, RFITS is comparatively more suitable for Hong Kong in current situation. RPS give rise to competitions, therefore it is different from REFITS which set a minimum price for electricity generated by renewable energy technologies. Currently wind energy development is immature in Hong Kong, hence more pioneers are needed to build up a wind energy market. Instead of competitions induced by RPS, REFITS which can guarantee a minimum return offers more confidence and seems to be more attractive to foreign investors and wind energy developers. With proper supportive measures, foreign developers with their funds and technologies can be attracted to Hong Kong and boost wind energy development. After wind energy is successfully adopted in a larger extent, RPS may then be the better choice, since it can stimulate wind energy innovation, drive down its costs and increasing its competitiveness through competitions. Whereas for Carbon Tax, it is a policy instrument commonly adopted, and is theoretically applicable to all countries and places using fossil fuels as major energy sources. It may be easier for Hong Kong in implementing by taking advantages from numerous experiences of foreign countries. Considerations of choosing policy instruments for Hong Kong It should be noted that many factors should be taken into considerations for adopting these policy instruments. For example, as like changing the energy market 42

52 structure, these policy instruments will definitely affect the two local power companies, so negotiations and consultations must be performed to ensure their cooperation thus smooth implementation of the instruments. These instruments are new to Hong Kong people, hence extensive educations and promotions must be in place to gain public s support. For REFITS, initially there will be a small increase in the electricity price due to the fact that wind energy is currently more expensive than fossil fuels, and this may spark oppositions in the society (Klein et al. 2008). Necessarily, advantages of renewable energy and environmental protection should be instilled to the public to increase the acceptability on wind energy developments. Also, when Carbon Tax is adopted, the government and public utilities can take the lead to pay first for electricity generated by wind energy so to demonstrate concrete supports on the policies. Furthermore, single instrument is hardly to be perfect and powerful, and a mix of political and economical instruments is always necessary. It should be tailored to wind energy and fit in Hong Kong condition, with careful planning and consultations (Haas et al., 2004) Setting up a specific authority for renewable energy Some analyses have suggested that incentive or economic-based elements may still be insufficient to create successful and sustainable renewable energy market (Haas et al. 2004). Institutional changes and a stable political framework are also vital for renewable energy development. Nowadays EMSD is the major department responsible for different issues related to renewable energy whereas EPD will often engage in promotional activities. Fragmented control may sometime arose due to lack of coordination (FOE, 2002). 43

53 In the future, a specific authority or taskforce should be set up to coordinate all renewable energy issues. A dedicated authority for renewable energy can provide a clear leadership and facilitate more effective and well-coordinated political arrangements. For instance, the authority can train and educate stakeholders, coordinate functions to promote renewable energy concepts to the public. It can also advise on policies setup of renewable energy, grant funds for small renewable energy projects and certify renewables performance of power companies and different technical data, etc. Through this way resources can be distributed more efficiently and renewable energy policies can be carried out more effectively Conclusion of wind energy s political development Without doubt, supporting wind energy in political aspects is not an easy task, especially for Hong Kong which is lack of political support on renewable energy at this moment. In addition to the above suggestions, the first and the most important step for Hong Kong is to carefully develop a renewable energy policy, which is now absent in Hong Kong. While different policies have been using worldwide with successes and failures depending on various factors, Hong Kong can learn from overseas experience and formulate a best policy combination that suit Hong Kong. For the renewable energy policy, it should have practical goals, be comprehensive, tailored to Hong Kong situation, and transparency of the policy must also be extensively emphasized. It is crucial that the policy should be sustainable and stable to enable long term development. Moreover, all political issues are extremely complicated and affect a wide variety of stakeholders. Prolonged and continuous efforts are essential, so it is imminent for Hong Kong to act now. 44

54 4.3 Geographical and meteorological aspects Background Hong Kong has a land area of 1,104km 2 (SMO, 2010), with population of about 7 million (C&SD, 2010), so its population density is very high, having 6,428 capita/km 2. One geographical characteristic of Hong Kong is that 80% of area is hilly and undeveloped, while most of the flatlands are developed for residential or commercial purpose with extensively high population density. Another characteristic is that Hong Kong as a peninsular surrounded by 1,651km 2 of sea area, possesses rich marine resources. Hence flatlands available for development are extremely insufficient. Even though Hong Kong is a small place, different studies have been carried out to assess her wind resources. As mentioned in Chapter 2, EMSD has performed a detail study and the results are issued in the Study on the Potential Applications of Renewable Energy in Hong Kong - Stage 1 Study Report. Other studies have also been carried out by various academics. Wind resources in Hong Kong vary with locations and are discussed below Development of wind energy on islands Wind resources on islands There are more than 250 islands in surrounding waters of Hong Kong, with total area of about 83 km 2. As a member of the Po Toi group of isles, Waglan Island is one of the islands in Hong Kong, located about 6 km southeast of Hong Kong Island as 45

55 shown in Figure 4.2. Figure 4.2 Location of Waglan Island (shown as the red dot) Source: Lands Department, 2011 Waglan Island is well exposed to winds without blocking effects by local topographic and surface roughness factors, and also not influenced by urbanization. Due to its geographical characteristics and high quality of weather data, it is usually regarded to be the best representative of Hong Kong wind resources especially for islands, and is used in different studies (Zhou et al. 2006). HKO has also mounted an anemometer on the island 26.3 m above ground level to collect wind data regularly. From the EMSD report, the predicted long term mean wind speed on the island is about 6.9 m/s, with wind power density of W/m 2 at 26.3 m above ground level. While the range of cut-in wind speeds for most wind turbines is between 3.0 m/s to 4.5 m/s, it is suggested that the wind resources on Waglan Island is quite high for wind power applications. Another study by Lu et al. (2002) also used Waglan 46

56 Island as reference, it is found that even though wind resources fluctuate due to seasonal variation, wind turbines at 37 m hub height can still operate for 77.85% of hours per year. It is concluded that rich wind resources are present to produce electricity. Application of wind energy It is found in different studies that outlying islands of Hong Kong possess satisfactory wind resources and are sufficient to generate electricity (Lin et al. 2002). There are hundreds of small islands in Hong Kong, especially in eastern and southern waters, some of these islands possess similar geographical conditions as Waglan Island and are also well exposed to winds. Since most of them are undeveloped with no inhabitants, effects posed on nearby community seem unlikely, and social impacts caused by wind turbines installation projects can be acceptable. Therefore, their potential for wind energy application should not be overlooked, further studies can be done to actively seek the feasibility of installing wind turbines on these outlying islands. Flatlands may not be available on these islands, therefore linear arrangements of wind turbines can be an option for the hilly terrain of these islands. Depending on the sizes of islands, large scale wind farms may not be feasible, several individual turbines as a group can then be used instead. Also, the wind turbines can be grid-connected to Hong Kong electricity network, or only supply electricity to nearby communities such as Lamma Islands, Cheung Chau, etc. Nevertheless, various factors should be considered for installing wind turbines on small islands. For example, transportation of turbines components on the sea is costly and installation of turbines on highly rugged terrain can be difficult. If a large number of islands are covered, the complicated undersea-transmission network may 47

57 pose a huge cost and then the projects may not be cost-effective. So detailed risks assessments and comprehensive studies must be done before the development. Therefore, development of wind energy on islands possesses potential, but it is quite difficult in Hong Kong and seems impossible in the near future Development of wind energy on land Wind resources on land In order to study wind resources in Hong Kong land and offshore area, EMSD has used a modeling to predict the wind resources in Hong Kong. Not only wind data was considered, topography, surface roughness of Hong Kong surrounding area and other factors were taken into calculation of the modeling; whereas the height is set at 65 m above ground level which is the common hub height of a modern MW class wind turbine (EMSD, 2002). Wind resources always vary, but this modeling comprehensive may act as a reference to have a general idea on wind resources. As shown in Figure 4.3, the model showed that about 393 km 2 on land was found to have relatively high wind resources, with wind power density higher than 400 W/m 2, and most of these lands are on the top of mountains or hills. Application of wind energy Wind resources are rich in certain areas of Hong Kong, and some may propose to construct onshore wind farms in these areas. However, complex considerations should be taken in developing wind energy on land. 48

58 Figure 4.3 Areas of rich wind resources on Hong Kong land (indicated by red regions) Source: Electrical & Mechanical Services Department (EMSD), 2002 Lands with rich wind resources are mostly located on mountains or hills with high attitudes, most of them are in rural areas and inside country parks. Hence land use restriction will definitely pose much difficulty on developing wind farms in these areas. Wind farms construction is a large project that will affect a large number of wildlife and habitats, transportation of wind turbines components must be involved in wind projects, but it seems impossible to construct roads and transportation systems in these sensitive areas. Due to the scale of the project, its impacts are inevitable and even with mitigations measures in place the damage would be large, so the Environmental Impact Assessment (EIA) seems unlikely to be approved. Social acceptance is also a crucial factor that needs to be taken into consideration. Not only onshore wind farm will negatively affect ecology in rural areas, but the natural scenic view will also be damaged by a large number of wind turbines. This will probably raise society s opposition against the project. For other areas having rich resources and are not affected by land use restriction, they have 49

59 high latitudes that makes transportation and installation of wind turbines extremely difficult and costly. Whereas installing wind turbines in areas with poorer wind resources is not cost-effective. Consequently, although some parts of land in Hong Kong possess rich wind resources, development of wind farms on these areas seems not a feasible option in Hong Kong Development of wind energy in offshore areas Wind resources in offshore areas The EMSD s modeling has also predicted wind resources in offshore areas of Hong Kong. As shown in Figure 4.4, it can be seen that large offshore areas possess rich wind resources, with about 744 km 2 of offshore area having wind power density higher than 200 W/m 2. The modeling has already avoided major navigation routes and marine parks, the areas also have mean water depths less than 30m which allow for direct wind turbines installation. Hence these areas represent regions suitable for offshore wind application theoretically. Application of wind energy It can be seen in the EMSD modeling that in Hong Kong, offshore area with rich wind resources is larger than that on land. As land limitation is the major constraint of wind energy development in Hong Kong, large offshore areas provide greater potential for wind application. 50

60 Figure 4.4 Areas of rich wind resources in Hong Kong offshore area (indicated by red regions) Source: Electrical & Mechanical Services Department (EMSD), 2002 For wind energy development offshore, large scale wind farms are always chosen, because an open sea can provide a huge area for regular arrangements for wind turbines that enable most effective applications of wind energy. These large scale projects are also cost-effective that can decrease average costs by economies of scales. Hong Kong is no exception, hence wind development offshore should in the form of wind farms Offshore wind farms as the most feasible option in Hong Kong Because offshore area possesses better wind flow than on land, offshore wind can generally produce more power and electricity (Madsen & Krogsgaard, 2010). Particularly for Hong Kong where lack of land is the major limiting factor for wind development, offshore winds seems to be the best choice and extensive efforts should 51

61 be spent to explore more opportunities in this direction. Considerations of offshore wind development There are different factors needed to be considered for developing offshore wind farms. Although the red regions in Figure 4.4 indicate areas suitable for offshore wind applications theoretically, development in some of these regions is not suggested. For example, Tolo Harbour is a small area surrounded closely by dense population on land of three sides, wind farms located in Tolo Harbour will pose great noise and landscape impacts on the communities nearby; the small area also limit the size of wind farm which makes the project not cost-effective. The case is similar for the region between West Hong Kong Island and East Lantau Island, where is also small, surrounded by lands and even with some vessels activities. Moreover, the estuary of Tolo Harbour is between Yan Chau Tong Marine Park and Hoi Ha Wan Marine Parks. Although the region for development does not fall in marine parks area, any nearby constructions may still pose risks on surrounding ecosystem and environment and these risks are not acceptable. Since these geographical conditions are unchangeable, development of offshore wind farm in these areas will not be possible in the future. Because sea water is highly erosive to machinery, offshore wind turbines must have very strong structures and foundations in order to stand against these extreme weathers conditions and erosion. Frequent maintenance and monitoring works are necessary, but due to poorer accessibility of offshore wind farms, the works will be more difficult which also means higher costs than the works for onshore wind farms. This is a consideration that occurs in all offshore wind farms, and it may be more significant because typhoons sometimes occur in Hong Kong. 52

62 Drivers of offshore wind development Despite the above considerations, offshore wind should be developed due to geographical limitations in Hong Kong. Offshore wind is a relatively new technology undergoing fast development, especially in Europe, 39 wind farms are operating and installed capacity continue to increase annually (Rock & Parsons, 2010). A good prospect is forecasted for offshore wind energy, and the cost is predicted to fall and become more competitive due to continuous and rapid technological improvements, so it is very useful for Hong Kong to take advantages from Europe s experience. Another advantage of offshore wind farm is lesser social impacts. Comparatively, offshore wind turbines possess fewer disturbances than onshore turbines, because their apparent size and noise can be significantly mitigated by distance and a large open sea area, therefore they are more acceptable by the public. For offshore wind development, an open sea area which is close to coast but not surrounded by small islands is ideal for an offshore wind farm, and in Hong Kong, eastern, southern and western waters meet the criteria. While the two proposed offshore wind farms are located in eastern and southern waters, there is still room available for more offshore wind development. In the future, more studies can be done to investigate the feasibility of constructing offshore wind farms in western waters or other areas available in Hong Kong. After the two proposed offshore wind farms are commissioned, they may be expanded to increase the installed capacity by installing more wind turbines. But it should be noted that all construction works on sea must be undertaken with great care, regular monitoring and mitigation measures must be carried out to minimize and avoid impacts on the environment and marine organisms. 53

63 4.3.6 Conclusion of wind energy s meteorological and geographical development Although various meteorological measurements and studies have proved that Hong Kong posses sufficient wind resources for application, some unique geographical conditions has greatly affects local wind energy applications. Compared to meteorological factors, geographical limitations seem to be the overwhelming factors which pose most restrictions to wind energy progress. Lack of land has become the most crucial factor limiting wind energy development, so onshore wind farms on land is not feasible in Hong Kong. Installing wind turbines on outlying islands can be an option, but its progress seems not to be possible in the near future due to different difficulties. Offshore wind farms, which can avoid land use constraints and with less social impacts, than become the best and only possible choice for Hong Kong. Hong Kong should treasure and exploit her rich wind resources offshore. With proper site selections, careful construction works, experience-learning from overseas on technologies and policies, offshore wind farm can have a great potential for development in the future. 4.4 Comments from power companies The two local power companies, CLP and HEC are the major stakeholders in Hong Kong energy market, so without doubt they can pose great impacts on wind energy development. In order to have more understandings on their perspectives on wind energy development in Hong Kong, simple questionnaires have been sent to and completed by CLP and HEC through s in February The 54

64 questionnaires comprised of three multiple-choices questions which collected CLP and HEC comments on wind energy facilitators, affecting factors and potential types of wind energy application in the future in Hong Kong. The two power companies suggested that wind resource, payback period of investment, availability of land and competitiveness with other energy are the four most important factors affecting power generation by wind energy in Hong Kong. Whereas for facilitating wind energy development in Hong Kong, the two power companies thought that public awareness and support on wind energy, government s policy and land use planning are the most useful drivers. From the power companies comments, it can be seen that government has the most critical role in developing wind energy in Hong Kong. Sufficient wind resources are present in Hong Kong but lack of land is the limiting factor. To treasure the wind resources, government s policy is vital. The government can implement various policies that can shorten the payback period of investments thus increasing competitiveness of wind energy. Much effort can also be put in educating and promoting wind energy to the public to raise their awareness and gain their support, so possible oppositions from the society may then be reduced in future wind development projects. 55

65 Chapter 5 Applicability of wind turbines in Hong Kong s built environment 5.1 Background Although development of wind energy in Hong Kong is limited due to unsuitability of rural areas, there is opportunity in local urban areas with dense buildings. It has been found that built environment has lower average wind speeds and higher turbulence levels than open areas, but these disturbed flows of air around buildings can then increase local wind speeds thus wind energy, and the power produced by wind turbines can be increased (Lu & Ip, 2009). This phenomenon which is called the concentrator effects produces rich resources in the built area, providing an opportunity to fully utilize urban area in Hong Kong for wind power generation. For wind energy application in built environment, turbines can be mounted on the roofs or integrated into buildings, and these turbines locating in the high wind speed zones in buildings are called Building Augmented Wind Turbines (BAWT) (Lu & Ip, 2009). There are many successful overseas applications, for examples, Bahrain World Trade Center of Dubai in Figure 5.1 is the first building in the world to integrate wind turbines into its design. Three 225 kw wind turbines are supported by bridges linking the two towers, and they produce approximately 1.3 GWh per year which is about 15% of the towers' total power consumption (World Architecture News, 2008). For mounted wind turbines on buildings, they are more common and can be seen even in Hong Kong. A 1.5 kw vertical-axis and a 1 kw horizontal-axis small wind turbine have been installed on the roof of the EMSD Headquarters as 56

66 demonstration, and both of them are grid-connected to provide electricity, as shown in Figure 5.2 and 5.3. Figure 5.1 Integrated Wind turbines of Bahrain World Trade Center of Dubai Source: World Architecture News, 2008 Figure 5.2 Horizontal-axis small wind turbine mounted on the roof of EMSD Headquarter Source: Electrical & Mechanical Services Department (EMSD), 2010 Figure 5.3 Vertical-axis small wind turbine mounted on the roof of EMSD Headquarter Source: Electrical & Mechanical Services Department (EMSD),

67 Currently there are about 30,000 buildings in Hong Kong which are equal to or greater than 65 m that have rich wind resources (EMSD, 2002), and most roofs of these buildings are vacant without specific use. In the EMSD modeling, it is predicted that when each of these buildings in Hong Kong are installed with one 40 kw wind turbine, approximately 2 to 3 TWh can be generated per year. A study carried out has also concluded that wind power utilization in high-rise buildings in Hong Kong is feasible theoretically (Lu & Ip, 2009). Obviously the maximum application raised by EMSD may not be practical, but these studies revealed that sufficient room is available for developing BAWTs and the potential should not be overlooked. 5.2 Considerations in Hong Kong Applications of BAWTs in built environment face different challenges in Hong Kong. First, ownerships of buildings may pose limitations for installation of BAWTs on buildings. Because this kind of application is not common in Hong Kong, people may have various concerns on this new technology. As many buildings in Hong Kong are owned by companies or property-owner alignments, a large amount of stakeholders is involved which means complicated perspectives will probably presence. Inevitably some may oppose installing BAWTs and the extent of wind energy development will be limited. Noise may also be a problem. Rotation of blades of BAWTs can generate noise which may be a disturbance to people, in rural areas noise generated by wind turbines is not a big problem due to sparse population, but in urban area it becomes significant that may be a predominant factor affecting people s acceptability. Especially when the buildings are not very tall, noise produced will pose more 58

68 impacts to communities nearby. Hence noise is a factor need to be tackled in installing wind turbines in buildings. Structure of buildings should also be considered. Wind turbines must be consolidated firmly on buildings for safety and to stand against extreme weather conditions, while rotations of blades may cause slight, imperceptible vibrations in buildings (Mertens, 2006). Therefore foundations and structures of buildings must be assessed in detail to ensure their feasibility and safety for application and to choose the most effective types of wind turbines. One of the most crucial factors limiting application of BAWTs may be the costs. As this technology is not common, economic data is not available, but initial costs is predicted to be high, including capital costs, installation costs, maintenance costs and grid connection costs, etc. Particularly the costs may be unbearable for owners without strong financial backup, such as residential buildings, which are not large companies or consortiums. 5.3 Suggestions Application of BAWTs in built environment is immature in Hong Kong, but it is worthwhile for Hong Kong to develop. Different measures can be implemented to boost up the development. Promotions by the government Although the two small wind turbines mounted on EMSD Headquarters is a pilot project, they should not be limited to demonstration only. More data and experience on local winds in built environment can be collected, and EMSD can use 59

69 them for investigation on large-scale and practical applications. Moreover, more pilot schemes can be carried out in Hong Kong, different governments buildings and complexes can act as pioneers to mount BAWTs. Not only it can show government s efforts on promoting renewable energy, providing more data for different studies, but it can also demonstrate the technology to the public, giving them more confidence thus encourage buildings owners to install BAWTs. Since BAWTs can generate electricity for a long time, considerable amount of electricity bills can be saved and BWATs is beneficial in long term. It is also possible to predict the expected financial payback period with a good degree of accuracy (Bahaj et al. 2007). Therefore, the government should amplify these economical strengths of BWATs, and promote, assist grid-connection of small wind turbines. The government can provide economic incentives to power companies to encourage them in providing grid-connection services and promoting BAWTs. The government can also provide technical supports or consultations, grant funding or low interest loans to those installers. These measures can offset the high initial costs of the technology which is the main obstacle of development, and more applications can then be encouraged. Application of hybrid wind-photovoltaic systems In order to make the wind turbines more reliable, they can be used in association with photovoltaic hybrid system. One of the major weaknesses of wind power is the intermittency, no power will be generated when wind is absent while presence of wind can hardly be predicted. When this hybrid system is used, solar energy can be produced and stored in day time, and used during the time wind energy is insufficient. 60

70 Wind and solar energy can compensate well each other, provide a good utilization factor for renewable energy applications, and this can greatly increase the stability and reliability of power supply. Various studies have been carried out to investigate hybrid wind-photovoltaic system, and concluded that this is one of the best renewable energy systems over the world with good operation data and reliable performance (Yang et al. 2009). This system is particularly suitable for small wind turbines such as BAWT, when a battery bank with an energy storage of 5 days can be used together, the probability of losing power supply can even be totally avoided (Yang & Burnett, 2003). The two local power companies, CLP and HEC have also commented in the questionnaire that hybrid wind-photovoltaic system has the highest potential to be developed in Hong Kong other than offshore wind farm. So it can be the direction of Hong Kong wind energy development in the built environment and more studies should be done on it. Buildings for application of BAWT in Hong Kong As mentioned before, BWAT can be used in two forms: wind turbines mounted on roofs of buildings or integrated into buildings. The latter application requires special designs before construction of the buildings so it is only suitable for new buildings to be constructed in the future. Hence, for existing buildings in Hong Kong, mounting BAWTs on the roofs should be the only way for development. Whereas opportunities should also be sought to integrate BAWTs into buildings in the future, the technology may be introduced in city planning, infrastructure projects, etc. Even though BAWT may not be installed at the start, whenever it s possible, all new buildings should have structures that are possible for wind turbines mounting later. Diverse potentials of applying BAWTs exist in different types of buildings in 61

71 Hong Kong. The development is much more limited for residential buildings, due to lack of financial support, generally lower buildings heights and large amount of residents. Noise and scenic impacts of BAWTs may be more significant to residential buildings and may not be welcomed. BAWT seems to possess more potential in buildings not for residential purpose, such as commercial buildings, hotels, education complexes, etc. For instance, many commercial buildings are tall thus providing a good environment and rich resources for BAWT. Particularly for hotels, usage of renewable energy can save electricity bills, demonstrate hotels endeavor in promoting environmental protection, eco-tourisms may indirectly be boosted and more customers can be attracted. The overall revenue can be increased. Case studies have shown that if renewable energy technologies are to be used in hotels, wind power is comparatively cheaper and more favourable, the technology is technically feasible and economically viable for some tourism accommodations and even large hotels. It may be a reference for Hong Kong (Dalton et al. 2008, 2009). 5.4 Conclusion for wind turbines in built environment of Hong Kong As like other forms of wind energy application, it is not easy to drive BAWT in Hong Kong. While there are extensively dense high-rise buildings locally, Hong Kong can regard it not a limitation, but as a chance to fully utilized wind resources inside it. Its progress is extremely slow and much works are required. This technology is relatively new in the world and in Hong Kong, but is developing and has a good prospect in the future. More studies and assessments should be done to investigate its 62

72 potential for large-scale operation in Hong Kong, government s support and promotion is also a critical factor towards success. 63

73 Chapter 6 Conclusions Developing and using renewable energy is the trend of the world. Especially wind energy is a clean energy without environmental and external costs; it is the most widely used and mature type of renewable energy, under rapid development and its competitiveness with conventional fossil fuels is increasing. Currently, fossil fuels including coal and natural gas are the major fuels for electricity generation in Hong Kong, and this has produced different environmental problems. As an effort to combat global warming and mitigate air pollutions, Hong Kong should increase its application of wind energy. At present, there are small amounts of wind turbines operating in different areas of Hong Kong, and Lamma Winds is the first and only commercial-scale wind turbines in commission. Two proposed offshore wind farms constructed by the two local power companies respectively are under development and forecasted to contribute to the electricity network in the future. Wind energy development is immature in Hong Kong and promotion should be done in different aspects. Even though wind energy is now more expensive, it has many advantages making it competitive against conventional fossil fuels. With research and development (R&D) and proper promotions of the government, wind power s economic comparative advantages can become more outstanding and the costs is forecasted to drop in the future, making it more feasible for development. Political support is always crucial for wind energy development in any places, but this support seems insufficient in Hong Kong. In the future, Hong Kong can seek the possibility to modify local energy market structure, and cooperate with China 64

74 such as integrating wind power from Guangdong into Hong Kong s electricity network. In addition, different political instruments such as Carbon Tax, Renewable Energy Feed-in Tariffs (REFITS) can be implemented to assist wind energy in gaining a standing position in the market. Setting up a specific taskforce dedicated to renewable energy is also important for better resources allocation and effective development progress. In terms of meteorology, Hong Kong possesses wind resources sufficient for wind energy application, especially in offshore area. But due to geographical constraints, offshore wind farms are predicted to have comparatively larger potential for development. The two proposed offshore wind farms are encouraging starting points, additional efforts should be spent to explore more places feasible for offshore wind development, such as in western Hong Kong waters. Another wind power application feasible in Hong Kong is installing wind turbines in the built environment, in the form of Building Augmented Wind Turbines (BAWT). There are different successful overseas cases worthwhile for learning, and different studies have suggested its feasibility in Hong Kong. Since Hong Kong has such a high concentration of buildings, we should seize the opportunity to fully utilize this wind resource. The government should put more efforts in promoting and assisting application of this technology in terms of technical and financial supports. Choosing appropriate buildings for applications, integration of the technology in future city planning are also crucial. To conclude, although wind power is limited in Hong Kong at this moment, it is the most feasible kind of renewable energy in long term and can have more development in the future. But the development will be impossible without 65

75 government s supports and actions, especially in economical and political aspects. Hong Kong should learn from overseas and act now to build a greener future. 66

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