Dr. Dzul's Blog

Energy Efficiency is Crucial: De-Coupling Tenaga’s Profit from Electricity Sales is a First Step

Malaysia’s heavy reliance on subsidised gas to generate electricity
is being displayed in sharp relief.  Our power generators are now
burning very costly distillate fuel to generate  electricity as gas
supply has been curtailed by scheduled maintenance and
unplanned outages at Petronas’s aging gas!fields.
This is costing our national power utility Tenaga Nasional Berhad
(TNB) an additional RM400 million per month. At!this rate, the RM2 billion cash support offered by the government and Petronas
will be burnt in just 5 months
1 It is clear the natural  gas subsidy  cannot!be sustained and a thorough review of the Malaysian
electricity supply industry is necessary.REFSA has already written on the very expensive independent
power producers (IPPs) in our system
2  In  this article, we focus on  promoting energy efficiency as the underlying logic for splitting up our
national power company TNB into aGenerating company and a Transmission!and Distribution focused
utility (T&D utility).
TNB is presently involved in all aspects of electric power!services, from generation transmission and distribution. It has often been suggested that the operations of TNB be  split up. Some of these
proposals stem from profit minded!entrepreneurs seeking to cherry pick the!most lucrative aspects of
TNB’s operations.
However, it has been found that managing the multiple, conflicting goals involved in the provision of
utility services today is indeed difficult when!Generation and T&D are managed by! he same company.
1. The public demands and deserves reliable and affordable electricity supply;
2. Shareholders and investors require reasonable returns on investment; and
3. There are social  goals  of  preserving the  environment and  securing  our  energy  future  by
promoting end use energy efficiency and renewable energy.

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