The Hongkong Electric Company Limited (HEC) supplies Hong Kong Island and the neighbouring islands of Ap Lei Chau and Lamma; CLP Power Hong Kong Limited (CLP Power) supplies Kowloon and the New Territories, including Lantau and several outlying islands. The supply to consumers is at 50Hz alternating current while the voltage is 220 volts single-phase and 380 volts three-phase.

The two supply companies are investor-owned. The Government monitors the two companies through mutually agreed Scheme of Control Agreements. Current agreements with CLP Power and HEC came into effect on October 1, 1993, and January 1, 1994, respectively. Both will last for 15 years. The first and second five-yearly interim reviews were completed in early 1999 and late 2003. The agreements require each company to seek the approval of the Government for certain aspects of their financial plans, including projected tariff levels. The agreements do not grant the companies any exclusive rights. They are not franchises, nor do they define a supply area for either company or exclude new entrants to the market.

At year-end, HEC had a total installed capacity of 3 420 megawatts (MW) at the Lamma Power Station. Its first 300MW gas combined-cycle generator at the new Lamma Extension Power Station is scheduled to start commercial operation in 2006.

The Castle Peak Power Company Limited (CAPCO) supplies electricity to CLP Power from its Black Point (2 188MW), Castle Peak (4 108MW) and Penny's Bay (300MW) power stations. The eighth 312.5MW generator is scheduled to go into operation at Black Point in 2006.

CLP Power and HEC own their respective transmission and distribution systems. The two transmission systems are interconnected by a cross-harbour link. This provides emergency back-up and achieves cost savings to consumers through economic energy transfers between the two systems and a reduction in the amount of generating capacity that needs to be kept as spinning reserve against the tripping of other units. The interconnection link currently has a total capacity of 720 megavolt-amperes (MVA) (i.e. 720 000 kilovolt-amperes (kVA)).

CLP Power's transmission system is also interconnected with the electricity network in Guangdong Province which facilitates the export and import of electricity to and from the province. The electricity sales to Guangdong are made from existing reserve generating capacity of CLP Power and are governed by an agreement with the Government, under which CLP Power's consumers receive priority of supply and 80 per cent of the profit from the sales. At the same time, CLP Power buys about 70 per cent of the power generated by the Guangdong Nuclear Power Station at Daya Bay, which has two 984 MW pressurised water reactors, to meet part of the longer-term demand for electricity in its supply area.

CLP Power also has the right to use 50 per cent of the 1 200MW capacity of Phase 1 of the Guangzhou Pumped Storage Power Station, at Conghua. Off-peak electricity from the CAPCO system and the Guangdong Nuclear Power Station is stored in the pumped storage power station, which generates hydro-electricity to meet Hong Kong's peak demand.

The Electricity Ordinance is the main enabling legislation on electrical safety. Under this ordinance, there are regulations concerning registration of electrical contractors and workers and competent persons, safety of electrical wiring, supply of safe household electrical products and protection of electricity supply lines from third party damage.

As at December 2005, some 8 700 electrical contractors and 64 500 electrical workers held valid registration. Also, some 590 competent persons had been approved for locating underground electricity cables. In 2005, the Electrical and Mechanical Services Department revised the code of practice on working near electricity supply lines to provide up-to-date guidelines on how to comply with the requirements of the Electricity Supply Lines (Protection) Regulation.

During enforcement of the Electricity Ordinance in 2005, the Government conducted some 12 200 site inspections to check the safety standards of electrical installations and electrical product supply outlets and works sites near electricity supply lines. Prosecution action was initiated in 374 cases.