Keng Yaik: Govt to wait for outcome of forum on power hike


THE government will wait for the results of a consultative forum before allowing an increase in electricity tariffs, said Energy, Water and Communications Minister Datuk Seri Dr Lim Keng Yaik. 

This forum set up under his ministry comprises players in the industry such as Tenaga National Bhd (TNB), independent power producers and consumers. It would debate the cost structure for any capital expenditure spent to meet increasing energy demands, he said.  

“I expect this forum to give me a cost structure proposal by end of the year,” he told reporters after opening a regional forum on sustainable energy in Putrajaya yesterday.  

Lim also said consumers could not expect TNB to finance any new capital expenditure as its current return on investment was only 4%, down from 8% before privatisation. 

Speaking at the forum earlier, TNB chairman Datuk Amar Leo Moggie said the company had been trying to meet electric supply growth, while coping with declining returns.  

“We currently have sufficient reserves to meet the country's demand till 2010,” said Moggie.  

“Subsequent to that, there is a need to re-look at various options, including hydro. Oil, coal and natural gas prices will continue to escalate while renewable energy cost should come down and all forms of energy would compete on a level playing field.”  

Lim said the Energy, Water and Communications Ministry would have to start planning now on how to meet energy demands beyond 2010.  

“A hydropower plant in Sungai Rajang, Sarawak, will have the potential capacity to generate 20,000MW. However the capital expenditure required is between RM10bil and RM12bil.” 

Lim also witnessed the signing of a memorandum of agreement on the establishment of Malaysia's first funding scheme for renewable energy projects yesterday.  

The scheme, known as Renewable Energy Business Facility, is set up with a fund size of RM28mil to provide financial assistance towards the development and implementation of biomass-based power generation projects. 

The memorandum of agreement was signed between Pusat Tenaga Malaysia, the Energy, Water and Communications Ministry, the United Nations Development Programme and Bank Industry & Teknologi Malaysia Bhd. 

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