YTL Power International Bhd said today that it has dropped out from a directly-awarded power plant project in Johor so that it can avoid any public misconception.

Among others, all four workers’ unions of Tenaga Nasional Bhd (TNB) had urged the government-owned entity to cease all ties with YTL Corp.

Together with SIPP Energy Sdn Bhd and Tenaga Nasional Berhad, YTL Power was part of a consortium specially chosen by the Energy Commission last month to develop a 1,000MW - 1,400MW combined cycle power plant in Pasir Gudang.

“We are thankful to the government for having confidence in YTL Power, as part of the consortium, to deliver the project on a fast-track basis.

“However, in view of the misconception over the Project, YTL Power has decided not to participate in the project under the present arrangement to dispel any misgivings over the government’s commitment to transparency and good governance,” the company said in a press statement.

The multi-billion dollar project would have cemented YTL’s status as an independent power producer (IPP) well into the future.  YTL has been a pioneer IPP since 1993 but has recently been bashed for profiting handsomely from its power sales to TNB and muscling in on the industry through government favours.

Besides the TNB unions, the Association of Water and Energy Research Malaysia (Awer) had been among those openly asking for YTL to be dropped from the project.

‘Not exiting the power sector’

YTL however clarified that it was not exiting the power sector nor protesting the Energy Commission’s methods.

“YTL Power welcomes any opportunity to participate in the project or other new capacity requirements on a competitive basis and is prepared to do so on an accelerated timeline,” it said in the statement.

“The commission has been transparent over the terms of the award which have been announced. Notwithstanding its clarification, there has, in recent weeks, been much misunderstanding and public debate over the award of the project,” YTL said.

 

In a letter dated May 27, the commission had tasked the consortium to start working on the project, also called Track 4A, so that it can be completed by 2018, two years earlier than planned.

The award went to lead developer SIPP Energy Sdn Bhd, which is linked to the Johor sultanate. SIPP Energy also has a power subsidiary SIPP Power Sdn Bhd, which is 70 percent owned by YTL Power.

YTL Power is a subsidiary of YTL Corp, a closely-held family company set up by billionaire Yeoh Tiong Lay in 1955. YTL’s managing director Francis Yeoh also suffered a public backlash after he said in a forum two weeks ago that it was YTL’s ingenuity that helped the company expand into many business lines including construction, hotels, high-speed railway, telecommunications and power sectors.

Yeoh also denied in the same forum that YTL had ever been a crony of Malaysia’s fourth prime minister Dr Mahathir Mohamad. Yeoh later apologised publicly for his remark as it had drawn criticism.

Meanwhile, a TNB spokesperson said that the national utility firm has yet to decide if it will stay on with the Track 4A project.

“At this juncture, TNB is not going to say anything yet, we have until July 25,” he told Malaysiakini over the phone.