RM1 million a day for power supply in Sabah
Sabah Electricity Sdn Bhd pays RM1 million every day to independent power plants for electricity supply.
However, heavy losses incurred by Sabah Electricity every year was not due to this hefty payment, said Deputy Minister of Energy, Communications and Multimedia Tan Chai Ho.
Tan was replying to a question from Senator Karim Ghani in Dewan Negara today.
There are 72 small power plants in Sabah and this is one factor contributing to Sabah Electricity's losses. The cost to generate power is higher in small plants because they are inefficient.
"Most of these plants are islanded or isolated. There is no connection between stations. The existing grid lines only connect towns in the west coast [of Sabah]. And this increases delivery cost," he said.
Tan explained that about 63 percent of the electricity generated in Sabah is fuelled by petroleum.
High petroleum costs make operating costs to generate electricity in Sabah high, said Tan.
The ministry was also asked what would happened to the IPPs once the Bakun Hydroelectric Project, which was revived last year, is completed as scheduled in 2007
Tan replied that they will continue to operate.
"The electricity generated by them can still be used, especially for peaking," the deputy minister said.
Peaking is when power plants are put into operation to meet the increase in consumer demand for electricity.
Twenty-one-year concession
Sabah Electricity Sdn Bhd pays RM1 million every day to independent power plants for electricity supply.
However, heavy losses incurred by Sabah Electricity every year was not due to this hefty payment, said Deputy Minister of Energy, Communications and Multimedia Tan Chai Ho.
Tan was replying to a question from Senator Karim Ghani in Dewan Negara today.
There are 72 small power plants in Sabah and this is one factor contributing to Sabah Electricity's losses. The cost to generate power is higher in small plants because they are inefficient.
"Most of these plants are islanded or isolated. There is no connection between stations. The existing grid lines only connect towns in the west coast [of Sabah]. And this increases delivery cost," he said.
Tan explained that about 63 percent of the electricity generated in Sabah is fuelled by petroleum.
High petroleum costs make operating costs to generate electricity in Sabah high, said Tan.
The ministry was also asked what would happened to the IPPs once the Bakun Hydroelectric Project, which was revived last year, is completed as scheduled in 2007
Tan replied that they will continue to operate.
"The electricity generated by them can still be used, especially for peaking," the deputy minister said.
Peaking is when power plants are put into operation to meet the increase in consumer demand for electricity.
Twenty-one-year concession
According to Tan, there are five independent power providers in Sabah - Powertron Resources Sdn Bhd, ARL Tenaga Sdn Bhd, Serudong Power Sdn Bhd, Stratavest Sdn Bhd and Sandakan Power Corporation Sdn Bhd.
Sabah Electricity's predecessor, the state-owned Sabah Electricity Board, gave each of the five IPPs 21 years concession from the date the companies started operation in the mid-1990s.
Power plants which started operating in mid-1990s are paid according to the Power Purchase Agreement.
In September this year, a total of RM32 million was paid to the IPPs for 125 million kwh of electricity they generated that month.
Sabah Electricity generates, transmits and distributes electricity.
According to its website, it is the only power utility company in Sabah supplying electricity to 290,412 customers distributed over 74,000 sq.km.
Eighty-three percent of the customers are domestic customers, contributing only 34 percent of the sale.
The total generation capacity is 785MW; 64 percent of the generating units are purchased from IPPs.
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