Thursday June 19, 2008 MYT 9:30:57 AM

Improve efficiency, power producers told

By TEH ENG HOCK

KUALA LUMPUR: Power producers have been urged to improve the efficiency of their generation plants to save costs in view of rising gas and coal prices.

Energy, Water and Communications Minister Datuk Shaziman Abu Mansor said Tenaga Nasional Berhad (TNB) and other independent power producers (IPPs) should upgrade their plants so that they consumed fewer natural resources while maintaining the same output.

“I hope to see the efficiency of power generation plants improve, from the current levels of between 40% and 50% , to 60%,” he said after closing the Electricity Summit here on Wednesday.

Shaziman used the 24-year-old Paka plant as an example, saying that its efficiency level was at 42% while modern plants could achieve 65%.

He said this was the best time to upgrade power plants in the country as partial shutdowns for upgrading work would not affect the power supply, seeing as Malaysia had a 38% buffer.

Shaziman said he would propose to the Cabinet to extend the power purchase agreements (PPAs) of IPPs if they upgraded their plants.

“When they come up with a new plant, we can ask them to come up with a new PPA. Each plant comprises blocks, and it is not necessary to totally change them all,” he said.

Shaziman also said that the Electricity Commission is currently preparing an Energy Blueprint, which would be ready by mid-August. However, he refused to elaborate further, saying that more would be announced when the blueprint was ready.

Last year, former Energy, Water and Communications Minister Datuk Seri Dr Lim Keng Yaik said an energy blueprint would be drafted, where IPPs would be required to supply electricity at competitive prices to an energy exchange to be set up by the Government.