KOTA KINABALU: The State government has welcomed the plan by Tawau Green Energy Sdn. Bhd. to develop Malaysia’s first geothermal power plant project at Apas Kiri, Tawau.
When completed the project will put Malaysia on the world geothermal power map, noted Minister of Tourism, Culture and Environment Datuk Masidi Manjun.
He said the RM480 million project which has been identified by the Minerals and Geoscience Department as a green project will be considered as qualified for carbon credits.
“We have made a smart decision to opt green energy when the whole world is talking about pollution.
“Sabah should be proud in taking this first major step to ensure the power plant will be based on green technology or less polluting.
“The State government also grateful to the Private-Public Partnership Unit (UKAS) of the Prime Minister’s Department for the access road and water treatment plant grant worth RM35million for this project,” he said at the signing ceremony between TGE and UKAS on the fund facilitation at at a leading hotel on Friday night.
Earlier in his speech, Masidi who witnessed the signing ceremony said geothermal energy is acknowledged by the United Nations as a green energy and therefore qualifies for carbon credit under the clean development mechanism.
The power plant, he said will reinforce Sabah Electricity Sdn. Bhd. (SESB) power generation capacity especially in the east coast of the State, while there will be employment opportunities for locals.
TGE signed a Renewable Energy Power Purchase Agreement (REPPA) with State utility SESB in November 2011. Under the terms of the REPPA, TGE will export 30MW to the Sabah grid from its geothermal power plant for a 21-year concession period at a fixed tariff of RM0.21/kWh.
Managing director of TGE, Ramzi Raad said with the REPPA in place and other supporting contracts and approvals either in place or in final stages of completion, TGE is now shifting the corporate focus to develop the Apas Kiri geothermal resources.
Ramzi said the 30MW from geothermal power plant project at Apas Kiri, Tawau is only the first phase of the project, and is expected to be completed by 2014.
The second phase of the project will be announced after the first phase succeeds, but the future plan will be more than 100MW in total. The second phase will be less in terms of the finacial capital because of the available infrastructure from the first phase.
Also present at the signing ceremony were the director general of UKAS Datuk Seri Dr. Ali Hamsa who signed on behalf of the federal government and managing director of Bank Pembangunan Malaysia who sign on behalf of the bank.