Tenaga Nasional Berhad (TNB) through its wholly-owned Special Purpose Vehicle company, TNB Bukit Selambau Solar Dua Sdn Bhd (TBSS2) has secured financing up to RM185 million for Large Scale Solar Mentari (LSS4) or its third Large Scale Solar (LSS) project in Bukit Selambau, Kuala Muda, Kedah under the government's Large Scale Solar@Mentari or Large Scale Solar 4 (LSS4) program.
TBSS2 has successfully completed the Financial Close on 30 September 2022 as scheduled. The solar project capacity is 50MWac (75MWdc). TBSS2 is expected to achieve its commercial operations in December 2023. The solar farm is being developed on an area of 175 acres, next to TNB's second LSS in Bukit Selambau. A financing amount of up to RM185 million is secured for the development.
With the prevailing challenging market conditions, it is a significant achievement that the project has achieved its Financial Close, enabling financing for the LSS project. This success has been partly attributed to the Energy Commission’s support in approving a 4-year extension of the PPA from 21 years to 25 years. CIMB Islamic Bank Berhad will be providing debt funding for the project for up to RM185.0 million.
TNB President and Chief Executive Officer, Dato’ Indera Ir. Baharin Din described the LSS project as a step forward towards achieving its sustainability pathway and 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,” he said.
He added, TNB aims to grow its overall Renewable Energy (RE) portfolio to 7,000MW by 2030 excluding large hydro, in line with TNB’s aspiration to achieve Net Zero & Coal-Free by 2050.
On 19th August 2021, TBSS2 signed a 21-year Power Purchase Agreement (PPA) for the development of the LSS facility.
TNB Chief New Energy Officer, Zarihi Hashim, said, “With a proven track record in managing more than 600MW RE assets of both solar and wind in domestic and international markets, TNB has the capability of developing large scale solar projects. TNB will continue to support the Malaysia Renewable Energy Roadmap (MyRER) targets and explore investment opportunities in Malaysia's RE sector.”