Malaysia can cut emission using Siemens' green turbines

The gas turbine is capable of supplying sufficient energy to a city of about 2.2 million people.

Siemens Malaysia president and Chief Executive Officer M Prakash Chandran said South Korea would be the first to use the gas turbine in Asia and if Malaysia were to opt for it as well, it would be the first in Asean.

Chandran said Siemens had secured a contract in South Korea and others were in final stages of negotiations.

The first deployment of the new H class gas turbine will be at the LNG-fuelled Bugok site of GS EPS (Electric Power and Services) in South Korea.

The turnkey contract for the new project, an investment of about 460 billion won (Bt12.4 billion), was signed early last year and commercial operation is scheduled for August next year.

“We are capable of doing full turnkey projects and a combination of solutions and systems to suit customers’ needs,” said Chandran.

The issue of using coal-fired plants or gas is an ongoing issue in energy generation in Malaysia as gas is a depleting resource. However, Malaysia is not a coal-producing country.

The question of gas over coal is once again brought to the fore with the conclusion of the old power producing agreements signed decades ago, and Tenaga Nasional and independent power producers are currently bidding to renew their power plant operating licences.

The government is expected to announce the winning bids in October.

Aside from signing the pact, independent power producers (IPPs) had earlier agreed to lower their rates for 48 months under their current power purchase agreements should they succeed in their bids. The power purchase agreements expire in 2015.

Another matter of interest with regard to energy generation is tenders for the construction of a new 1,000 megawatt power plant.

The award is expected to be out by the end of this year. The Energy Commission is currently conducting another competitive bidding exercise for a new 1,000MW power plant for commissioning in 2017.

There would also be new tenders for an additional 2,000MW for commissioning in 2018 and 2019, depending on the outcome of the current competitive bidding exercise, Minister of Energy, Green Technology and Water Peter Chin Fah Kui said.

The construction of these plants is to meet the growing electricity demands of Malaysian homes, offices and factories.

At the moment, the country's electricity is mainly generated by gas-powered plants. As at end of last year, it was reported that natural gas accounted for 60 per cent of Tenaga Nasional’s fuel mix to generate power but coal, though it involves the burning of fossil fuels, offers a more economical proposition. Singapore and Thailand use predominantly gas to generate energy.

However, over the medium term, coal would play a bigger role in the country's power generation, he said.

Coal-powered plants can generate electricity at a lower cost compared with gas. With technologies available today, it is possible for a coal-powered plant to be “green” as well.

“Coal will feature prominently in the future in the fuel energy mix,” he said.

Meanwhile, Energy Commission chairman Ahmad Tajuddin Ali said first generation IPPs were likely to be ask for lower returns in the renewal of their operating licences.

The IPPs, which were reported to be getting an internal rate of return (IRR) of over 15 per cent, are believed to be looking at an IRR of about 10 per cent this time around.