German power house Siemens believes its newly launched gas turbine SGT5 8000H for the green energy generation field will be able to help Malaysia achieve its goal of cutting 40 per cent CO2 emissions by 2020.
The newly launched gas turbine is capable of supplying sufficient energy to a city of about 2.2 million people.
Siemens Malaysia Sdn Bhd president and CEO M. Prakash Chandransaid South Korea would be the first to use the gas turbine in Asia and if Malaysia were to opt for it as well, it would be the first in Asean.
Prakash said Siemens had secured a contract in South Korea and others were in final stages of negotiations.
The first deployment of the new H class gas turbine will be at the LNG-fuelled Bugok site of GS EPS (Electric Power and Services) Ltd in South Korea.
The turnkey contract for the new project, an investment of about 460 billion won, was signed early last year and commercial operation is scheduled for August next year.
“We are capable to do full turnkey projects and a combination of solutions and systems to suit customer’s needs,” said Prakash.
The issue of using coal-fired plants or gas is an ongoing issue in energy generation in Malaysia as gas is a depleting resource. However, Malaysia is not a coal-producing country.
The question of gas over coal is once again brought to the fore with the conclusion of the old power producing agreements signed decades ago and Tenaga Nasional and independent power producers are currently bidding to renew their power plant operating licences.
The Government is expected to announce the winning bids in October.
Aside from signing the pact, the IPPs had earlier agreed to lower their rates for 48 months under their current power purchase agreements should they succeed in their bids. The power purchase agreements expire in 2015.
Another matter of interest with regard to energy generation is tender for the construction of a new 1,000 megawatt (MW) power plant.
The award is expected to be out by end of this year. The Energy Commission is currently conducting another competitive bidding exercise for the planting up of a new 1,000MW capacity power plant for commissioning in 2017.
There would also be new tenders for additional 2,000MW for commissioning in 2018 and 2019, depending on the outcome of the current competitive bidding exercise, Minister of Energy, Green Technology and Water Datuk Seri Peter Chin Fah Kui said.
The construction of these power plants is to meet the growing electricity demands of Malaysian homes, offices and factories.
At the moment, the country’s electricity is mainly generated by gas-powered plants. As at end of last year, it was reported that natural gas accounted for 60 per cent of Tenaga Nasional Bhd’s fuel mix to generate power but because coal, though it involves the burning of fossil fuels, offers a more economical proposition. Singapore and Thailand use predominantly gas to generate energy.
However, over the medium term, coal would play a bigger role in the country’s power generation, he said.
Coal-powered plants can generate electricity at a lower cost compared with gas. With technologies available today, it is possible for coal-powered plant to be “green” as well.
“Coal will feature prominently in the future in the fuel energy mix,” he said.
Meanwhile, Energy Commission chairman Tan Sri Ahmad Tajuddin Alisaid the first generation independent power producers (IPPs) were likely to be asking for lower returns in the renewal of their operating licences.
The IPPs, which were reported to be getting an internal rate of return (IRR) of over 15 per cent, are believed to be looking at an IRR of about 10 per cent this time around.
