Just so that you know, TNB’s revenue and net profit for the last five years.
Source: TNB Annual Report 2010
May 302011
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Dec 162008
Power demand is dropping as the economic slowdown creeps up on us, but TNB is being forced to pay more in capacity charges to IPPs and take over the laying of the Bakun undersea cables (to transmit even more electricity to the peninsula) after Sime Darby wisely pulled out.
By the way, TNB is 38 per cent owned by the Finance Ministry’s Khazanah and 14 per cent owned by EPF. So guess who is ultimately bearing the risk? Us.
A political economist has sent the following comment to me.
TNB is complaining that Peninsula Malaysia is going to have 45 per cent excess capacity within the next eight months. TNB also says that this excess capacity is due to the Jimah IPP coming online in January 2009. Given the terms of the IPP between Jimah and TNB, TNB expects to see a drop of about RM500 million from their overall profit margin since the IPP contract cannot be re-negotiated. TNB actually also said that they do not need the excess power but have to buy it. See story here.
Amazingly, this is going to happen within the context of a decline in power demand in Peninsula Malaysia which is set to drop with the coming downturn..! See this power demand drop story here.
What on earth are our energy planners thinking of?
First of all, we have 40 per cent reserve capacity in the peninsula. TNB is now paying capacity charges for electricity it buys from the independent power producers which it doesn’t need.
Then, there is the plan to transmit a huge chunk of the electricity from the Bakun Dam from Sarawak over to the peninsula via undersea cables. But hold on, the submarine cables, which would be the world’s longest, would now cost RM15 billion. Alamak! So how? Sime Darby has already pulled out from the project.
