Additional Gas-fired Generation Units Project Project Profile 22 April 2015 Environmental Resources Management 16/F, Berkshire House 25 Westlands Road Quarry Bay, Hong Kong Telephone 2271 3000 Facsimile 2723 5660 www.erm.com

Additional Gas-fired Generation Units Project Project Profile Document Code: 0282148_BPPS-CCGT PP_v0.docx

Environmental Resources Management 16/F, Berkshire House 25 Westlands Road Quarry Bay Hong Kong Telephone: (852) 2271 3000 Facsimile: (852) 2723 5660 E-mail: post.hk@erm.com http://www.erm.com

Client: Castle Peak Power Company Limited (CAPCO)

Project No: 0282148

Summary: Date: 22 April 2015

This document presents the Project Profile for Application for an EIAO Study Brief for the Additional Gas-fired Generation Units Project.

Approved by:

Frank Wan Partner

0 Project Profile for Formal Submission Var JNG FW 22/04/15

Revision Description By Checked Approved Date This report has been prepared by Environmental Resources Management the trading name of ERM Hong-Kong, Limited, with all reasonable skill, care and diligence within the terms of the Contract with the client, incorporating our General Terms and Conditions of Business and taking account of the resources devoted to it by agreement with the client. We disclaim any responsibility to the client and others in respect of any matters outside the scope of the above. This report is confidential to the client and we accept no responsibility of whatsoever nature to third parties to whom this report, or any part thereof, is made known. Any such party relies on the report at their own risk.

Distribution

Internal

Government

Public

CONTENTS

1 INTRODUCTION 1

1.1 BACKGROUND 11.2 PURPOSE OF THIS PROJECT PROFILE 2

2 BASIC INFORMATION 3

2.1 PROJECT TITLE 32.2 NAME OF PROJECT PROPONENT 32.3 PURPOSE & NATURE OF PROJECT 32.4 LOCATION & SCALE OF THE PROJECT & HISTORY OF SITE 42.5 OVERVIEW OF PROJECT ACTIVITIES 42.6 NUMBER AND TYPE OF DESIGNATED PROJECT TO BE COVERED BY THE PROJECT

PROFILE 52.7 NAME AND TELEPHONE NUMBERS OF CONTACT PERSON 6

3 OUTLINE OF PLANNING AND IMPLEMENTATION PROGRAMME 7

3.1 PROJECT PLANNING & IMPLEMENTATION 73.2 INDICATIVE PROJECT PROGRAMME 73.3 INTERACTIONS WITH OTHER SURROUNDING PROJECTS 7

4 MAJOR ELEMENTS OF THE SURROUNDING ENVIRONMENT 10

4.1 PLANNING & DEVELOPMENT CONTEXT 104.2 INDUSTRIAL, COMMERCIAL & RESIDENTIAL DEVELOPMENTS 104.3 SHIPPING FAIRWAYS 114.4 SUBMARINE UTILITIES, INCLUDING CABLES, PIPELINES & OUTFALLS 114.5 GAZETTED BATHING BEACHES 114.6 SEAWATER INTAKE 114.7 AREAS OF CONSERVATION VALUE 114.8 COASTAL PROTECTION AREA 114.9 ECOLOGICAL SENSITIVE RECEIVERS 124.10 FISHERIES SENSITIVE RECEIVERS 124.11 SITES OF CULTURAL HERITAGE 12

5 POTENTIAL IMPACTS ON THE ENVIRONMENT 14

5.1 OVERVIEW OF POTENTIAL ENVIRONMENTAL IMPACTS 145.2 AIR QUALITY 145.3 NOISE 155.4 WATER QUALITY 165.5 TERRESTRIAL ECOLOGY 165.6 MARINE ECOLOGY & FISHERIES 175.7 WASTE MANAGEMENT 175.8 LAND CONTAMINATION 185.9 LANDSCAPE AND VISUAL 195.10 CULTURAL HERITAGE 195.11 HAZARD TO LIFE 195.12 CUMULATIVE IMPACTS 19

6 ENVIRONMENTAL PROTECTION MEASURES TO BE INCORPORATED IN THE DESIGN & FURTHER ENVIRONMENTAL IMPLICATIONS 20

6.1 AIR QUALITY 206.2 NOISE 216.3 WATER QUALITY 216.4 MARINE ECOLOGY & FISHERIES 226.5 WASTE MANAGEMENT 226.6 LAND CONTAMINATION 246.7 LANDSCAPE AND VISUAL 246.8 HAZARD TO LIFE 246.9 POTENTIAL SEVERITY, DISTRIBUTION & DURATION OF ENVIRONMENTAL EFFECTS246.10 FURTHER ENVIRONMENTAL IMPLICATIONS 24

7 USE OF PREVIOUSLY APPROVED EIA REPORTS 25

ENVIRONMENTAL RESOURCES MANAGEMENT CASTLE PEAK POWER COMPANY LIMITED 0282148_BPPS-CCGT PP_V0.DOCX 22 APRIL 2015

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1 INTRODUCTION

1.1 BACKGROUND

CLP Power Hong Kong Limited (CLP) is responsible for providing a safe, highly reliable and clean supply of electricity to over 80% of Hong Kongs population at reasonable cost. Within Hong Kong, CLP operates three power stations, namely Castle Peak Power Station (CPPS), Black Point Power Station (BPPS) and Pennys Bay Power Station (PBPS) owned by Castle Peak Power Company Limited (CAPCO), a joint venture between CLP and China Southern Power Grid Company Limited, of which CLP holds a 70% interest.

To support Hong Kongs major infrastructure development, new development and redevelopment areas, and consistent with CLPs 2014-2018 Development Plan approved by the HKSAR Government, a number of capital projects have been proposed to address the continuous growth in electricity demand. Preparation for the development of additional gas-fired generation capacity is one such project.

Ensuring sufficient generation capacity to meet load demand is vital to a reliable electricity supply, as well as maintaining appropriate reserve margins to cater for unplanned outages. In 2014 the peak demand for electricity in CLPs system reached 7,030 MW and this is forecast to rise in the next several years. The reserve capacity of CLPs supply system has already declined to 26%, against the range of 20-35% recommended by the International Energy Agency, and will reduce further if electricity demand continues to grow as forecast.

CLP and CAPCO support the HKSAR Governments objective of improving air quality and environmental performance in Hong Kong. Consistent with the HKSAR Governments medium-term strategy of increasing the use of natural gas for local power generation, and reducing carbon intensity of local electricity generation, provision for additional local gas-firing generation capacity is considered by CLP and CAPCO to be the preferred choice.

The purpose of CAPCOs current proposal is to consider the installation of up to two additional gas-fired generation units by CAPCO at Black Point Power Station (BPPS) (hereafter referred to as the Project). However, any formal decision by CLP/CAPCO to proceed with building any additional gas-fired generation capacity requires further analysis as such investment decision is dependent upon a host of factors including the rate of demand growth, environmental requirements, technical feasibility, the economic merits of the project and HKSAR Government approval. Accordingly, the submission of and content described in this Project Profile does not amount to a commitment by or on behalf of CLP and/or CAPCO to proceed with the Project.

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1.2 PURPOSE OF THIS PROJECT PROFILE

This document, the Project Profile, is produced for the Project to obtain an EIA Study Brief under the Environmental Impact Assessment Ordinance (EIAO) (Cap. 499). It includes a description of the potential environmental impacts associated with the construction and operation of the Project, should CLP/CAPCO decide and are able to obtain HKSAR Governments approval to proceed with the Project. The description presented herein has been based on best available information compiled by CLP/CAPCO describing relevant construction activities, operational details and baseline information describing the conditions at the Project site and its surrounding environment.

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2 BASIC INFORMATION

2.1 PROJECT TITLE

Additional Gas-fired Generation Units Project

2.2 NAME OF PROJECT PROPONENT

Castle Peak Power Company Limited (CAPCO)

2.3 PURPOSE & NATURE OF PROJECT

The scope of the Project involves the construction and operation of up to two 600 MW class additional gas-fired generation units at BPPS to both increase electricity generating capacity and accommodate continuous growth in electricity demand. Planning for such gas-fired generation units is also consistent with the HKSAR Governments strategy to increase the use of natural gas for power generation.

Technically, CAPCOs preference is to adopt two units of combined cycle gas turbine (CCGT) configuration using natural gas as the primary fuel. Such configuration is aimed at reducing emissions as compared with coal-fired generation and thereby providing a relatively clean source of electricity for Hong Kong.

2.3.1 Operation of a Combined Cycle Gas Turbine (CCGT)

CCGT is a form of highly efficient power generation technology which combines a gas-fired gas turbine cycle with a steam turbine cycle. The combined cycle uses a gas turbine to generate electricity and then recover gas turbine exhaust waste heat in a boiler to produce steam, which in turn drives a steam turbine and increases significantly the system power output without using additional fuel in either the steam boiler or steam turbine cycle. This technology is currently being used at BPPS with an installed capacity of 8 units (each of 312.5 MW), using natural gas as the primary fuel. An indicative schematic diagram showing the CCGT process is depicted in Figure 2.1.

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Figure 2.1 Combined Cycle Gas Turbine Process (arrangement for illustration only)

2.4 LOCATION & SCALE OF THE PROJECT & HISTORY OF SITE

The proposed location for the Project is within the existing boundaries of the BPPS site. Based on the preliminary project design information available at the time of preparing this Project Profile, the proposed location for each of the additional gas-fired generation units comprising the Project are illustrated in Figure 2.2. Notably, the proposed Project location is