KUALA LUMPUR: Ranhill Utilities Bhd's subsidiary, Ranhill Solar I Sdn Bhd (RSI), has signed a large-scale solar 4 @ Mentari (LSS4@Mentari) photovoltaic power purchase agreement (PPA) with Tenaga Nasional Bhd for the construction and operation of a 50MWa.c. solar photovoltaic energy generating facility in Batang Padang, Perak.
Randhill said the energy produced by the facility would be sold under a long-term PPA, directly to TNB for 21 years from the commercial operation date.
Further, the company viewed this project as a step in the right direction as Ranhill pursue the development of renewable energy in helping to contribute to the country's energy transition to cleaner and greener Malaysia.
Ranhill president and chief executive Tan Sri Hamdan Mohamad said the company was identified as the shortlisted bidder for the LSS4@Mentari programme earlier this year to develop large scale solar plants.
"This showed that we are fully committed to our venture into the solar energy sector.
"Ranhill focuses on sustainability in all our business operations, and that has led us to actively pursue the cause to continuously reduce our carbon footprint as a company by growing our renewable energy portfolio," he said.
The company is delighted to sign the PPA with TNB to be the developer and operator for the solar photovoltaic energy generating facility under the government's LSS4@Mentari initiative for 21 years.
"This contract will provide us with a recurring income until 2042, which will contribute positively to our projected earnings and subsequently strengthening our company's bottom line for the foreseeable future," he added.
The 21 years concession is expected to contribute positively to Ranhill's bottom line, and the facility's construction is expected to start before the end of 2021.
Under the contract, RSI will design, construct, own, operate, and maintain solar photovoltaic energy generating facility with a capacity of 50MWa.c.
The successful tender of LSS4@Mentari was Ranhill's first venture into asset ownership of a large scale solar project.
Ranhill subsidiaries Ranhill Bersekutu Sdn Bhd (RBSB) and Ranhill Worley Sdn Bhd (RWSB) have previously developed photovoltaic solar projects.
RBSB will now be the engineering, procurement, construction and commissioning (EPCC) contractor and operate and maintain the facility.
Ranhill has been the owner and developer of an independent power producer since 1998, owning and operating two combined-cycle gas turbines in Kota Kinabalu Sabah.
This venture into renewable energy aligns with Ranhill added focus towards sustainable development and its environmental, social and governance (ESG) objectives.