KUALA LUMPUR: Tenaga Nasional Bhd
's (TNB) strong electricity demand growth is expected to be sustained over the near to medium term.
This is partly driven by rising energy demand from data centres (DCs) over the next few years.
According to CIMB Securities, TNB shared in its briefing that it had completed connection of seven DC projects to the electricity grid in the first half of the year so far and this totals a circa. 1,070MW.
An additional 3.2GW of 21 DC projects are in the supply application stage, it said.
"The strong DC demand had led to TNB estimating a higher 3.0-4.0% demand for the forecast financial year 2024, compared to their previous estimates of 2.5%-3.0%," it said.
"This is a key positive as this could indicate higher projected electricity demand going into Regulatory Period 4 (RP4) vs the 1.7% growth parameter embedded in RP3. This should help alleviate pressure on electricity tariffs, thereby providing support for the likely increased capital expenditure on TNB's regulated assets during RP4-RP5, in line with the National Energy Transition Plan (NETR)," it added.
According to TA Research, management also shared TNB's plans to repower the Paka power plant with a proposed Combined Cycle Gas Turbine (CCGT) capacity of 1400MW.
The proposal is currently under negotiations with the regulators and if successful, TNB is targeting for commercial operation date (COD) by 2030.
"On top of this, TNB is also looking at the potential of repowering the Kapar power
plant with new 2100MW CCGT capacity by 2031. The Kapar power plant currently comprises a block of 1486MW coal capacity and another 564MW conventional gas capacity, which are due for expiry in 2029," TA Research said.
