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TNB has to pay IPPs for excess power

(adsbygoogle = window.adsbygoogle || []).push({}); YTL Power is only IPP with social obligation to use” pay for use” formula, meaning YTL does not selling excess electricity to Tenaga for the sake of selling.

Tenaga has to pay one billion for excess capacity generated by just a single company, let imagine how much Tenaga has to fork out for all IPPs. As reported Tenage is holding at about 40% excess capacity mostly generated by IPPs. And you cannot store electricity for the next day, where electric current has to be drained off to earth regularly.

This is only a side of the coil where our money (Tenaga is owned by government!) is wasted for compensating “excess capacity” not utilized by our consumers.

Another side of the coin is Petronas has to subsidize cheap natural gas for IPPs which is costing Malaysia government another few billion ringgit.

In a nutshell, total money wasted for excess capacity = TNB compensation (2008: 4 billion) + Petronas subsidy (2006:5 billion)

For clarity, I calculate Petronas gas subsidies for IPPs in 2006 is about 5 billion RM (35.7% out of 14 billion) [Source: http://tonypua.blogspot.com/2007/12/reduction-in-gas-subsidies.html]

A shocking fact is Malaysia is wasting at best estimated of […]