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.
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.
To add salt to injury, Tenaga is ALSO being forced by the Federal Govt to foot the bill for the Bakun Undersea Cable to supply even more excess electricity capacity to the Peninsula. See story here.
Now, you tell me, how responsible is this kind of BN approach to development when we are facing a severe downturn? To me, it seems as if the Federal Govt loves its IPP cronies and Sarawak BN cronies more than ordinary suffering electricity consumers. Is this not theft of public resources via officialdom?