To promote the development of renewable energy (RE) in Hong Kong, the Government launched the Feed-in Tariff (FiT) Scheme in 2018, which allows eligible citizens to install renewable energy power systems (REPS) at their premises, including solar photovoltaic (PV) systems and wind power systems, and sell the generated RE to power companies at a rate approximately 5 times higher than the normal electricity tariff rate. Subsequently, solar PV system installation contractors in the market have stepped up their promotions though the service quality varies vastly. Amongst the complaint cases received by the Consumer Council relating to solar PV systems, some consumers were unable to commence the works due to the power company’s request to upgrade the electrical power system after the consumers had made the payment for the works or because the system failed to comply with regulatory requirements; there were also cases related to unsatisfactory maintenance services.
The Council reminds consumers that certain legislations and regulatory requirements are applicable to the installation of solar PV systems. Consumers must ensure full compliance of all regulatory requirements, including electricity safety, building safety, fire safety, and land planning. The works should pass the tests performed by the relevant power companies in accordance with the stated procedures and also be registered with the Electrical and Mechanical Services Department (EMSD) as a power generation facility. The Council recommends consumers who plan to install solar PV systems to clarify relevant legislations, details and liability before payment, and not to wrongly trust contractors with installation methods that are incompliant with the regulations, resulting not only in lost opportunity of power generation income, but might even lead to risks of violating relevant legislations.
Case 1: Wrongly Trusted the Contractor to Keep Unauthorised Building Works (UBW) when Installing Solar PV Panels Resulting in Works Incompliant with Regulatory Requirements
Hoping to participate in the FiT Scheme, the complainant contacted Company A to conduct an on-site inspection, and also notified Company A that the premises used single-phase electrical power and that a reported exempted UBW was on the rooftop. After on-site inspection, Company A recommended constructing a canopy of similar height next to the UBW and have the solar PV panels installed on top of the canopy, claiming that this could cover the whole rooftop while retaining the existing UBW. The quotation of the project was $198,000. Owing to Company A’s claims that there was no need to demolish the existing UBW and that they had similar successful cases of FiT applications before, the complainant paid a deposit of $19,800.
Company A later claimed that the application had been approved by the power company, but the complainant must pay a $30,000 works cost to convert to three-phase electrical power. The complainant opined that as she had declared the use of single-phase electrical power early on, the request to convert to three-phase electrical power now was unreasonable and exceeded her budget, thus she declined the proposal. At the same time, upon direct enquiry with the Buildings Department (BD) and power company, she found that Company A’s claims were false. The BD responded that the common requirements for installing solar PV systems in New Territories Exempted Houses (NTEH) (commonly known as village houses) stipulated that the roof on which the system would be installed to be cleared of all UBWs, including those acknowledged by the BD under the Reporting Scheme for UBWs in NTEHs. On the other hand, the power company pointed out that the application was not approved as the 1kw capacity of the single-phase electrical power at the complainant’s premises was insufficient. The electrical power must be upgraded to three-phase with a capacity of 6kw in order for the application to proceed. Despite Company A’s repeated reassurance that it was feasible to install the solar PV panels on the additional canopy next to the UBW, the complainant had already lost confidence in Company A. The complainant requested that the works be cancelled and filed a complaint with the Consumer Council.
However, the staff of Company A maintained that their person-in-charge was not available. Despite repeated approaches by the Council, they still failed to provide a specific reply. As such, the Council recommended the complainant to seek independent legal advice before deciding whether to proceed with civil action.
Case 2: Repeated Problems in System Fittings; After-sales Service Not Guaranteed
The complainant engaged Company B in September 2019 to install a solar PV system on the rooftop of their NTEH at a cost of $168,000 to be paid by 3 instalments. After Company B obtained approval from the power company, they outsourced to a contractor to install the supporting frame and solar PV panels on site. The installation was successful, passed the relevant site test and arrangements, and the FiT Meter officially started operation in March 2020. However, the complainant discovered problems in the inverter component after 2 months and despite having some parts replaced by Company B’s technician, the problems soon recurred. The person-in-charge of Company B agreed via text message to handle the issue, but failed to follow up after repeated promptings. The outsourced technician who helped with the installation also tried to contact the person-in-charge of Company B but to no avail. The complainant eventually sought help from the Council, citing that the contract provided a 15-year free warranty for the solar PV panels, while the components and the supporting frame could enjoy 5-year and 10-year warranties respectively. The complainant reiterated that since the repeated problems in the inverter component within a short period was not due to human damage, he would settle the outstanding payment of $50,000 only if Company B honoured the warranty.
The Council’s attempts to reach Company B through different channels also proved futile. The complainant eventually engaged the outsourced technician to replace the component and put the system back in order. The complainant expressed that since Company B did not fulfil its claims of warranty, he would retain the outstanding payment to cover maintenance costs in the future.
Case 3: Installation Not Approved by Property Management Office; Contractor Denied a Full Refund of Down Payment
The complainant previously purchased a unit with rooftop at a private housing estate for personal use, and wished to join the FiT Scheme. He thus engaged Company C for installation works at a cost of $265,000, which covered various procedures, including the installation of equipment; application for the FiT Scheme on behalf of the applicant; submitting plans to the BD; as well as obtaining the generating facility registration certification from the EMSD for the applicant. The complainant paid a down payment of $26,500 at the time of signing the contract and left it in the hands of Company C to submit applications to the power company and property management company. However, the property management company rejected the installation as they claimed that it did not comply with the regulatory requirements. As the works could not commence, the complainant sought a refund from Company C but did not receive a reply after a month. He subsequently sought help from the Council.
Company C responded that as stated in the contract, the down payment would be fully refunded only if the application is rejected by the power company, but since this project had already obtained the approval, a refund would not be provided. Company C reiterated that its solar PV systems complied with the requirements of the minor works regulation, and it was only the property management company’s opinion that it did not comply with the regulatory requirements. Company C thus proposed a discretionary refund after deducting the work cost of $11,500, but this was rejected by the complainant. After conciliation by the Council, Company C eventually agreed to deduct a work cost of $5,000 and refund the balance to the complainant. Both parties agreed to this settlement.
The Council opines that when consumers install solar PV systems in village houses or private buildings, they should ensure that the system complies with all the regulatory and technical requirements, regardless of whether it is intended for the FiT Scheme. Consumers should refrain from making hasty decisions purely based on the recommendation of the contractor, and pay extra caution to the following:
- If in doubt, consumers should enquire with relevant departments directly, and only engage a contractor after confirming that their premises comply with all the regulatory requirements. Consumers could make reference to the “Guidance Notes for Solar Photovoltaic (PV) System Installation” (https://re.emsd.gov.hk/english/files/PVGuidanceNotes.pdf) and the HK RE Net, carefully read the outline of application procedures for solar PV systems and the FiT Scheme, and call the enquiry hotline;
- Private building owners are advised to check whether any restrictions are stipulated in the Deed of Mutual Covenant, and to obtain prior agreement from the Owners’ Corporation or the management company;
- Village house owners should seek professional advice and understand whether installing such equipment might affect other occupants, and whether consent from other owners is required;
- Despite there currently being no specific licence for the installation of solar PV systems, consumers should note that such works involve generating facilities and a Registered Electrical Contractor (REC) must be employed to carry out the related electrical work. To verify the professional qualifications of the contractor, consumers could make use of the registers search on BD and EMSD’s websites. A register of RE installation contractors can also be found on the EMSD’s website;
- Pay heed to whether the power equipment at home complies with the requirements. Should there be a need to upgrade to three-phase electrical power, additional costs and time might be required. Consumers should therefore decide after receiving the preliminary application results from the power company;
- The project contract should clearly stipulate the works procedure, material specifications, warranty terms, as well as the payment flow. Before signing the contract, consumers should carefully enquire whether the works cost covers all application procedures carried out by the contractor on behalf of the applicant and submission of documents, etc.
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