KPOWER Bhd can expect 21 years of steady revenue stream and cash flow from the commercial operation date (COD) of the the 50MWa.c. solar photovoltaic energy generating facility in Mukim Bebar, Pekan, Pahang which the company is mandated to design, construct, own, operate and maintain.
The facility is expected to commence operations by 2H 2023.
This follows the company’s inking of a large-scale solar (LSS) photovoltaic power purchase agreement (PPA) with power utility Tenaga Nasional Bhd yesterday (Aug 19).
The PPA agreement comes on the back of the group’s successful bid in the LSS Phase 4 (LSS4) bidding programme initiated by the Energy Commission in March 2021.
The PPA was signed through KPower’s 95%-owned subsidiary PKNP KPower Suria Sdn Bhd (PKSSB) which was incorporated in collaboration with Perbadanan Kemajuan Negeri Pahang.
“We will continue to explore diversifying our revenue from the engineering, procurement, construction, completion and commissioning (EPCC) segment which is mostly project-based or concession-based where revenue will be derived from the sale of energy throughout the concession period,” commented KPower’s group managing director Mustakim Mat Nun.
The PPA governs the obligations of PKSSB and TNB to sell and purchase the energy generated by the facility to TNB for a 21-year period from the COD in accordance with the agreed terms and conditions as stipulated in the PPA.
Mustakim said KPower is excited of its future given the renewable energy sector’s potential continues to grow in line with the Energy and Natural Resources Ministry’s (KeTSA) goal to increase installed renewable energy (RE) capacity in the country.
“As KeTSA projects the installed RE capacity to grow from 7,995 megawatts (MW) currently to 18,000MW by 2035, more and more focus will be put on Peninsular Malaysia which accounts for 80% of Malaysia’s electricity demand,” he projected.
“With our progressive strengths and expertise in the sustainable energy, utilities and infrastructure space, we are confident of capturing the undoubtedly abundant opportunities this scenario will present to us, thus solidifying our position as a major RE player in Malaysia.”
At 4.27pm, KPower was unchanged at 72 sen with 1.58 million shares traded, thus valuing the company at RM326 mil. – Aug 20, 2021
