Sarawak Hidro Sdn Bhd is ramping up the generation capacity of the Bakun hydroelectric dam in anticipation of higher demand for power by year-end.
“About 900MW of electricity is now available for use by Sarawak Energy Bhd (SEB),” managing director Zulkifle Othman told StarBiz.
SEB consumed between 300MW and 350MW daily of power from Bakun; its consumption had reached the highest level of 500MW a day.
“Excess power from Bakun is on standby. We expect demand for power to go up by the end of the year,” he said.
The dam developer is now in the process of putting up the additional four turbines from Argentina. These turbines, which have a capacity of 300MW each, are expected to be commissioned in stages over 12 months.
Three of the four turbines from Alstom are in operation.The fourth is under testing and expected to be commercially commissioned by the end of the month.
The RM7.3bil Bakun Dam in the upper Rejang River basin in central Sarawak has an installed capacity of 2,400MW. Analysts expect firm supply at around 1,770MW.
Bakun is the world’s second highest concrete-filled dam (at 228m above sea level) after China’s Shuibuya dam (233m).
Sarawak Hidro, which is owned by the Ministry of Finance Inc, is selling power from Bakun at 6.25 sen per kilowatt hour (kWh) with an annual increase of 1.5 per cent for 30 years under an agreement signed with SEB’s wholly-owned unit, Syarikat SESCo Sdn Bhd (the state-owned utility body), eight months ago.
The Sarawak government has imposed a water levy of one sen/kWh or about RM150mil per annum on Sarawak Hidro. SEB would earn a minimium revenue of RM112mil this year from power sale.
According to SEB chief executive officer Torstein Dale Sjotveit, demand for Bakun electricity from the Sarawak Corridor of Renewable Energy (SCORE) investors had exceeded the amount that it could supply.
SEB has inked power purchase agreements with OM Materials (Sarawak) Sdn Bhd and Asia Minerals Ltd (AML), two of the first batch of four SCORE pioneer investors.
OM Materials, a 80:20 joint venture between OM Holdings Ltd and Cahya Mata Sarawak Bhd (CMSB), is buying 500MW for 20 years to power its proposed US$500mil manganese and ferrosilicon alloy smelting plant in Samalaju Industrial Park, Bintulu.
The smelter, which is scheduled to commence production in early 2014, will start receiving initial power of 30MW after July, 2013.
AML gets the supply of 270MW, also for 20 years, for its RM790mil manganese ferro alloy smelter project.
The company will start receiving electricity on April 15 this year.
SEB is expected to sign similar PPAs soon with Japan’s Tokoyama Corpand Press Metal Bhd, which are building a RM3bil polycrystalline silicon plant and a RM5bil aluminium smelter respectively in Samalaju.
Among other SCORE investors that are in various stages of negotiations with SEB are Smelter Asia Sdn Bhd and Sarawak Aluminium Co Sdn Bhd (Salco), both of which planning to set up an aluminium smelter in Samalaju.
Smelter Asia is a joint-venture firm between Gulf International Investment Group Holdings Sdn Bhd (headed by billionaire Tan Sri Syed Mokhtar Al-Bukhary and UAE-based business leader Mohamed Ali Rashed Alabbar) and Aluminium Corp of China. It has planned for a US$1.6bil smelter project.
Salco is a joint-venture between Australia’s Rio Tinto Alcan and CMSB.
To cope with power demand from SCORE investors, SEB would start construction of a 600MW coal-fired power station in Balingian in the Mukah Division within SCORE this year.
The RM3bil power station will be SEB’s second biggest investment in an energy project after the 944MW Murun hydroelectric dam.
SEB owns a 2x135MW coal-fired station in Mukah.
The Murum dam, which is more than 55 per cent completed, is expected to start producing power in 2014 for SCORE’s energy-intensive industries. It will complement the Bakun dam.
Sjotveit pointed out that the tariff prices now achieved with SCORE customers were 40 per cent higher than the level negotiated in 2009.
He did not reveal the difference in the rates.
According to Zulkifli, the Bakun Dam, which has a catchment area of 14,750sq km, is operating smoothly without technical problems.
