TNB secures up to RM185 mln financing for LSS4 Bukit Selambau project

KUALA LUMPUR, Oct 14 (Bernama) -- Tenaga Nasional Bhd’s (TNB) wholly-owned special purpose vehicle company, TNB Bukit Selambau Solar Dua Sdn Bhd (TBSS2) has secured financing up to RM185 million for the Large Scale Solar Mentari (LSS4) project in Bukit Selambau, Kedah.

The group said that this is its third large-scale solar (LSS) project in Bukit Selambau, under the government's LSS4 programme, and TBSS2 had successfully completed the financial close on Sept 30, 2022, as per schedule.

In a statement today, it said the solar project has a capacity of 50 megawatts (MWac).

The solar farm is being developed on an area spanning 70.82 hectares, next to TNB's second LSS in Bukit Selambau, and is expected to achieve commercial operations in December 2023.

“Given the prevailing challenging market conditions, it is a significant achievement that the project has achieved its financial close.

“This success has been partly attributed to the Energy Commission’s support in approving a four-year extension of the power purchase agreement (PPA) from 21 years to 25 years, where CIMB Islamic Bank Bhd will be providing debt funding of up to RM185 million for the project,” said TNB.

TBSS2 signed a 21-year PPA for the development of the LSS facility on Aug 19, 2021.

President and chief executive officer, Datuk Baharin Din described the LSS project as a step forward towards achieving TNB’s sustainability and environmental, social and corporate governance (ESG) targets, as well as ensuring continued business growth for the national utility company.

“The LSS project will contribute to the energy transition that will also open up new opportunities for TNB’s business growth and long-term sustainability, as well as spur new economic catalysts for Malaysia.

“TNB aims to grow its overall renewable energy (RE) portfolio to 7,000 megawatts (MW) by 2030 -- excluding large hydro -- in line with its aspiration to achieve net zero and coal-free target by 2050,” he said.

Meanwhile, chief new energy officer, Zarihi Hashim said TNB has a proven track record of managing more than 600MW of RE assets -- both solar and wind -- in domestic and international markets.

“TNB will continue to support the Malaysia Renewable Energy Roadmap targets and explore investment opportunities in Malaysia's RE sector,” he said.

The latest project in Bukit Selambau is expected to further drive growth in clean and green energy demand within the region in the coming years, reflecting TNB’s latest milestone in its continuous support of the nation’s aspiration of achieving 31 per cent installed RE capacity by 2025 and 40 per cent by 2035.

TNB’s RE gross portfolio is currently at 2844MW in Malaysia and 993MW across the United Kingdom, Turkiye and India, comprising mainly solar, wind and hydro energy generation assets.

-- BERNAMA