Gov't must explain 1MDB appetite for power

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The government must explain the reasoning and the lengths taken to accommodate 1MDB appetite for assets in the energy industry including the recent negotiated tender exercise on solar plant despite the latter's less than stellar standing in the financial world.


Parti Keadilan Rakyat (KeADILan) vice president Nurul Izzah Anwar said otherwise Malaysian consumers would be bereft of any explanation as to how the government wheels and deals projects in the country.


In a statement, Nurul Izzah pointed out that 1MDB solar farm initiativie would also encroach upon Tenaga Nasional Berhad (TNB) areas of expertise.


Additionally, she pointed out that TNB’s wholly-owned subsidiary TNB Energy Services Sdn Bhd had been championing renewable energy, especially solar power, for years now.


"1MDB’s foray into solar power will only crowd out TNB and other, smaller solar power players," she said.


Nurul Izzah said the government must immediately explain why it decided to embark on a direct tender exercise in the case involving 1MDB when in the past its authority had taken great pain to exercise open bidding through its transparent online open bidding systems for energy quota fixed between 1MW and 5 MW in 2012.


"The government must also confirm the type of support provided to the project - whether through transmission from solar plant to grid, bridging any gap on funding grants, to the lease for the estimated 500 acre land needed for the entire project," she said.


She wanted to know whether the project would come about through the usual Private Public Partnership project.


Nurul Izzah said the public also deserved to know who is the technological partner or provider to 1MDB, to ascertain the extent of risk exposure for 1MDB - which is now considered a national treasure by the government.


She said without any guaranteed offtake, and having to compete against conventional fuels - the cost of the 50 MW solar plant project could cost up to RM900 million - despite photovoltaic prices being on a downward trend.


She also questioned 1MDB track record and in-house expertise needed to run the solar power projects.


Nurul also wanted to know the location for the project that could occupy an estimated areas of between 300 to 500 acres required for the 50MW solar plant.


"Has the necessary Environmental Impact Assessment study been done to ascertain the impact of such a set up on residents in Kulim," she said.


To date, she pointed out that the largest solar farm in the world is Ivanpah - deeply situated in the US desert - that produced a total of 371 MW sited on 3,700 acres of land.


"It would be most pertinent for the government to disclose an EIA in a project handed out to 1MDB in Kedah," she said.


Nurul Izzah also noted that 1MDB had been on a power hunt of late; beginning on the acquisition of over RM10 billion in power assets at inflated prices, which include the power assets of Tanjong, Jimah and Genting; to the recent successful bid of RM11 billion, 2,000MW coal-fired project; to the the blatant directly negotiated 50 MW solar panel powered project.

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