NETR Is The Central Catalyst For Power Sector, Here Are The Key Beneficiaries

July 27, 2023

RHB Research (RHB) is overall, positive on the National Energy Transition Roadmap (NETR) as it paves the way to expedite energy transition here, lifting the renewable energy (RE) projects’ potential returns via energy exports.

Key successful elements are such as the diligent execution, stringent policy implementation, and ability to bridge the funding gap.

The NETR development is divided into two parts. Part 1 outlines the 10 flagship catalyst projects and impact initiatives based on six energy transition levers, namely energy efficiency, RE, hydrogen, bioenergy, green mobility, and carbon capture, utilisation & storage (CCUS).

Part 2 is likely set for end August, focusing on establishing a low-carbon pathway, energy mix and emissions reduction targets, and the enablers needed for energy transition. A pilot RE zone will be established, encompassing an industrial park, zero-carbon city, residential development, and data centre.

“We believe TNB is one of NETR’s key beneficiaries, largely from the potential earnings upside from higher transmission & distribution (T&D) assets and potential strong ramp-up in domestic RE presence,” said RHB in the recent Malaysia Thematic Report.

It plans RM35bn in investments in 2025-2030 for the grid. With the potential RE capacity expedition here, a grid upgrade charge and wheeling charges are likely to be tabulated under a new scheme to compensate TNB for utilising its T&D assets.

The company is likely to be involved in at least 3GW worth of RE projects announced, 500MW solar parks and 2.5GW hybrid hydro floating solar projects, that could uplift its current RE capacity of 3.9GW.

“Given that there is an aggressive expansion in domestic RE capacity, we see the local solar EPCC contractors such as Solarvest, Samaiden, Sunview, and Pekat as direct beneficiaries,” said RHB.

Reservoir Link, a sub-contractor and mounting structure provider, will also benefit from higher job flows in RHB’s view. Assuming an EPCC contract is valued at RM2.5m/MW, a minimum 4GW solar capacity investment could translate to RM10bn worth of job opportunities for such players in the next few years.

RHB Research (RHB) is overall, positive on the National Energy Transition Roadmap (NETR) as it paves the way to expedite energy transition here, lifting the renewable energy (RE) projects’ potential returns via energy exports.

Key successful elements are such as the diligent execution, stringent policy implementation, and ability to bridge the funding gap.

The NETR development is divided into two parts. Part 1 outlines the 10 flagship catalyst projects and impact initiatives based on six energy transition levers, namely energy efficiency, RE, hydrogen, bioenergy, green mobility, and carbon capture, utilisation & storage (CCUS).

Part 2 is likely set for end August, focusing on establishing a low-carbon pathway, energy mix and emissions reduction targets, and the enablers needed for energy transition. A pilot RE zone will be established, encompassing an industrial park, zero-carbon city, residential development, and data centre.

“We believe TNB is one of NETR’s key beneficiaries, largely from the potential earnings upside from higher transmission & distribution (T&D) assets and potential strong ramp-up in domestic RE presence,” said RHB in the recent Malaysia Thematic Report.

It plans RM35bn in investments in 2025-2030 for the grid. With the potential RE capacity expedition here, a grid upgrade charge and wheeling charges are likely to be tabulated under a new scheme to compensate TNB for utilising its T&D assets.

The company is likely to be involved in at least 3GW worth of RE projects announced, 500MW solar parks and 2.5GW hybrid hydro floating solar projects, that could uplift its current RE capacity of 3.9GW.

“Given that there is an aggressive expansion in domestic RE capacity, we see the local solar EPCC contractors such as Solarvest, Samaiden, Sunview, and Pekat as direct beneficiaries,” said RHB.

Source – Business Today

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