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Alternatives to coal option in Sabah
Written by Chan Kok Leong Thursday, 24 June 2010 11:06 - Last Updated Thursday, 24 June 2010 11:12
This article appeared in The Edge Financial Daily, June 24, 2010. Link to the original article here.
KUALA LUMPUR: A general sentiment of euphoria and a sigh of relief would have marked the prime minister’s announcement that three more power plants will be built in Sabah during the 10th Malaysia Plan.
The plants, with a total capacity of 700MW, are expected to be constructed in the five-year development master plan. “There has always been a case of suppressed demand in Sabah,” said Plantation Industries and Commodities Minister Tan Sri Bernard Dompok in welcoming the announcement.
“The state economy could be in a better position if industries were allowed to grow here. But it’s a chicken-and-egg situation. Because of the lack of power, industries are reluctant to move here and so power producers did not see the need to invest in improving their capacity,” said Dompok, the Member of Parliament for Penampang.
According to an independent report produced by the University of California, Berkeley, Sabah currently uses 700MW of the 900MW produced by Sabah Electricity Sdn Bhd (SESB) and five other independent power producers (IPPs). SESB currently operates three types of power plants — hydro (8%), diesel (10%), gas (60%), medium fuel oil (19%) and biomass (2%).
Forty-eight percent of the gas-powered plants are operated by IPPs. The report entitled Clean Energy Options for Sabah noted that electricity demand in the state was growing between 8%-10% from 2000-2006 while GDP grew at an average of 3%-4% for the same period. With consumption estimated to grow at 7%, Sabah will consume 1,000MW by 2015 and 1,500MW by 2015.
But for power-starved Sabah, the sense of respite was shortlived. Along with two gas-based plants in the west coast, the government had announced that a coal-powered plant would be built in the eastern part of the state. For Sabah, which has on average the highest incidence of power interruptions in the country, this would be their first coal-powered electricity plant.
SESB had planned to build a 300MW coal-powered plant in the Felda area of Tungku in Lahad Datu. This is the third attempt by the Tenaga Nasional Bhd subsidiary after efforts to have the plant in Silam, Lahad Datu and Sandakan were thwarted by the state government and local residents.
Now, SESB is again facing resistance from environmentalists and conservationists who are against its efforts to build the plant in the east coast of Sabah. According to Sabah Re-Unite to Power the Future (Green Surf), the location of the plant is too close to the Sulu-Sulawesi Marine Ecoregion, which lies off the northeastern coast of Sabah.
Its proximity to the Tabin Wildlife Reserve could have disastrous repercussions, Green Surf spokesperson Cynthia Ong told The Edge Financial Daily. Ong, who is from the Land Empowerment Animals People non-government organisation, and four other NGOs presented a memorandum in Parliament on Tuesday, urging the government to reconsider building the coal-powered plant in Sabah.
The group, comprising of Ong and representatives from Malaysian Nature Society, Partners of Community Organisations and WWF-Malaysia, presented the memorandum to Minister in the Prime Minister’s Department Datuk Seri Nazri Abdul Aziz, Natural Resources and Environment Minister Datuk Douglas Unggah Embas and Dewan Rakyat Speaker Tan Sri Pandikar Amin Mulia.
“The impact from this plant will include pollution of the water and air and increased shipping through coral reefs to import coal from Indonesia. A coal plant in this location could have catastrophic implications on the ecosystem,” said Ong.
She added there are other alternatives to using coal to generate electricity in Sabah. “But it seems like the government has gone for the simplest option without considering other choices like biomass,” she added.
Dompok, who oversees palm oil industries, said that he could sympathise with the NGOs. “Sabah has always been a very green state and this should be preserved,” said the Upko president. He said that gas and biomass are good alternatives to power generation in Sabah as the state produces both items without having to import coal. Currently Sabah has the largest concentration of oil palm plantations in the country.
“Sabah has 12-13 trillion cubic feet of natural gas which can be tapped for power generation. With the current technology, liquefied gas can be transported from Kimanis on land to the east coast for power generation,” said Dompok.
The minister said that although the use of bio-gas and biomass plants to generate electricity is not yet a complete solution, it can still contribute towards power production in the state. As for rural areas which are not connected to the grid, Dompok said that micro-hydro stations are a viable option.
In the report Clean Energy Options for Sabah, the University of California researchers examined the use of biomass waste, hydropower, solar, wind, geo-thermal and demand-side energy efficiency in power generation for the state.
Using the data to generate cashflow projections and taking into account Malaysia’s “Pioneer Tax Allowance” and other incentives, the report concluded that biomass waste projects at large palm oil mills were cost-competitive with coal.
“Feeding unused palm oil waste into these efficient combustion systems solves two environmental problems at once; the problem of waste disposal in open ponds and landfills and the problem of supplying Sabah’s energy demand,” said the report in its executive summary.
“Based on 2008 palm oil industry production statistics, we calculate that 700MW of theoretical baseload capacity will be available from palm oil waste by 2020 and that over 400MW of this capacity is economically feasible and achievable via a four-project per year ramp-up programme,” it added.
The report also said that hydropower and other river-hydropower options were cost competitive with coal.
According to the report, geothermal was less cost-competitive while solar options are currently 10 times as expensive as coal in Malaysia although Sabah receives strong solar radiation.