KOTA KINABALU: The Energy, Green Technology and Water Ministry (KeTTHA), the Ministry of Finance (MoF) and Tenaga Nasional Berhad (TNB) have begun a crucial discussion on the future of Sabah Electricity Sdn Bhd (SESB).
In a statement, KeTTHa Minister Datuk Seri Dr Maximus Ongkili said SESB is on the verge of insolvency and continues to make losses.
TNB owns 82.75 per cent of SESB, while the remaining stake is held by the state government.
“SESB’s current average tariff is 34.52 cents/kwh, while the cost of energy generation is 56.50 cents/kwh.
"Hence, the federal government has been subsidising SESB’s fuel costs, primarily of diesel, medium fuel oil and gas,” Ongkili said.
He added that the federal government has also been providing the bulk of SESB’s capital expenditure (capex).
Since 2012, the federal government has spent RM4.2 billion to boost SESB’s operation.
Both TNB and SESB have also spent their portion on capex.
Between 2016 and 2019, the federal government allocated RM2.3 billion for capex and reduced the System Average Interruption Duration Index (SAIDI).
Ongkili added that through these efforts, the SAIDI in Sabah has been reduced from 777 minutes/customer/year in 2014 to 311 minutes last year.
The SAIDI is expected to be further reduced to 280 minutes by year end.
Ongkili noted that SESB has also been asking for a tariff revision since its last review in 2014, but stressed that the federal government has its duty to ensure that the tariff is fair and affordable to consumers.
“We also want to ensure that the tariff revision is reflective of the quality of power delivered,” he said.
Meanwhile, TNB chief executive officer Datuk Seri Azman Mohd disclosed that an agreement is expected by the new year to determine the best option for SESB's future.