The Ministry of Energy and Natural Resources (KeTSA) of Malaysia has announced the launch of 1 GW solar tender.
The tender has been floated under the fourth round of the nation’s Large- Scale Solar (LSS) program initiated by the Malaysian government to attract investments in the renewable sector.
This is the largest capacity ever tendered by the Malaysian government and can be seen as an effort by the government to boost the local economy following the COVID-19 crisis. It is also an effort by the government to improve the renewable sector of the country, which has been affected badly by the pandemic.
According to the Ministry, the tender is open only to 100% locally-owned companies registered in Malaysia. Companies that are listed on the Malaysian Stock Exchange (Bursa Malaysia) can take part in the bidding process, provided 75% of the shareholding in the company is held by locals.
The maximum capacity that a bidder can bid for has been lowered to 50 MW from 100 MW in the third phase in an attempt to encourage participation. Each bidder can submit a maximum of three bids.
The two packages offered through the tender are:
- Package 1: The total quota is 500 MW and the capacity offered is from 10 MW to 30 MW
- Package 2: The total quota is 500 MW and the capacity offered is from 30 MW to 50 MW
Through the offering, the Ministry believes that local companies will take part in the bidding process, and that will help in expanding the solar industry in the country.
The bid submission deadline has been reduced from six months to three months from the release of the tender. The tentative deadline for bid submission is August 29, 2020. The government hopes that the implementation of these solar projects can start by the end of 2020.
The implementation of the program is likely to generate RM 4 billion (~$927 million) and create 1,200 new job opportunities for the locals. The projects are expected to commence operation by 2023.
In January this year, the Energy Commission of Malaysia (Suruhanjaya Tenaga) awarded nearly 491 MW of large-scale solar projects to five companies. The winning companies were ib vogt GmbH and Coara Solar, Cypark Resources Berhad and Impian Bumiria, JKH Renewables and Solarpack Asia, ENGIE Energie Services and TTL Energy, and Konsortium Beseri Jaya and Hanwha Energy Corporation Singapore. The tender was issued in February 2019, by Suruhanjaya Tenaga to develop 500 MW of large-scale solar projects in Peninsular Malaysia. Once commissioned, the projects were to be connected to the grid and sell energy to Tenaga Nasional Berhad under a power purchase agreement. This was the third large-scale solar project tender under the country’s large-scale solar program. The project capacity was between 1-100 MW and expected to be commissioned by 2021.