Casino boom sets tills ringing but drains Macau’s power supplies

Hong Kong – A casino boom has transformed the sleepy Chinese backwater of Macau into the Vegas of the Far East but has also put a serious strain on its power supplies, a news report said Monday. Electricity use in the densely-populated former Portuguese colony leapt 17.6 per cent year on year in the first five months of 2007 and the territory is becoming increasingly prone to power outages, according to the South China Morning Post.

The territory consumed 650 kilowatts of power in the first quarter of 2004 just before the Vegas-owned Sands casino opened but last year consumed 2.4 billion kw, 37 per cent more than in 2003.

Fifty two per cent of Macau’s electricity is now being imported from southern China’s mainland power grid compared to just 15 per cent two years ago, the newspaper said.

The surge in electricity consumption in the territory of 450,000 people has been spurred by a boom in casinos which last year saw Macau overtake Las Vegas in gambling revenue, taking in 7 billion US dollars to 6 billion US dollars in Vegas.

As new casinos continue to open, Macau’s electricity consumption is expected to jump to 4.3 billion kw by 2010 and legislators quoted by the newspaper said they feared the city’s energy security could be put at risk by reliance on imported power.

Casino hotels are the top user of electricity, with their 24 hour gaming tables which draw millions of gamblers a year mostly from mainland China, Taiwan and neighbouring Hong Kong, where casinos are not allowed.

The surging power demand has led to a number of major power cuts in recent months, including one which cut off thousands of homes and businesses for four hours in Macau’s Dynasty Plaza area in May.

Legislators quoted by the newspaper argued that the power monopoly held by sole supplier CEM should be broken up and action taken to make Macau less reliant on imported power from mainland China.

Macau was a Portuguese colony for 450 years before reverting to Chinese sovereignty in 1999. Its casinos operated under a monopoly runby tycoon Stanley Ho until 2002 when the industry was opened up to allow Vegas-run operators to set up casinos.

The city’s casinos are now proving some of the world’s most profitable as big-spending Chinese gamblers barred from going to casinos in their home countries pour into Macau to play the tables.