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25MW for biomass, biogas operators

ENCOURAGING LOCAL KNOW-HOW: Govt raises bonus tariff to 5 sen/kWh from 1 sen/kWh

PUTRAJAYA: The government has allocated 25MW (megawatt), or 39 per cent, of this year’s 65MW renewable energy (RE) quota to biomass and biogas operators, said Sustainable Energy Development Authority (Seda) chief executive officer Badriyah Abdul Malek.

Up until last year, biomass and biogas made up 37 per cent of the 536MW RE quota. Oil palm biomass and biogas plant operators, which had successfully bid for the RE quota and accorded licences by Seda, will receive 32 sen/kWh (kilowatt per hour) under the feed-in tariff (FiT) when they hook up to the national grid.

In encouraging the use of local engineering know-how, the government has raised the bonus tariff to five sen/kWh from one sen/kWh, Badriyah said after Seda’s public briefing on the RE licence bidding process, here, yesterday.

This means a qualified biomass operator supplying RE to the power grid should be able to receive 37 sen/kWh if he uses local gas engine technology, Badriyah explained.

She highlighted to prospective RE producers that online bidding for the right to apply for RE quota opens on May 2 from 4pm onwards.

The FiT essentially guarantees RE producers a premium selling price over that generated from depleting and finite sources such as oil, gas and coal. Power generated from sustainable sources that will benefit from FiT include that of oil palm biomass, biogas, small hydro and solar. 

Like previous years, a prospective RE producer will have to bid for the right to apply for the FiT and this is done via online so as to ensure a transparent application process. The online FiT application is available from May 2.

RE producers need to go online and bid for the relevant FiT rate as the FiT rate differs for different RE technologies and installed capacities.

RE producers then apply for a licence from Seda through its website at seda.gov.my. In applying for a FiT approval, the prospective RE producer needs to submit the work plan for the RE installation/plant.

Once the FiT is granted, Seda will closely monitor each RE installation until commencement date is achieved. This is to prevent the applicant from monopolising the RE quota. 

Once a FiT application has been approved, a portion of the RE fund will be automatically allocated to the approved applicant. To avoid any monopolisation of the RE quota, Badriyah noted Seda’s online system will track the RE installation/plant’s milestones via the submitted work plan. 

If any delays are detected, a notice will be sent to the applicant to request for an explanation for the delay. If the applicant fails to respond satisfactorily, then the application will be revoked.

When that happens, the fund committed to the applicant will be released, and this will return the allocated quota to the system. “This is to prevent any abuse of the FiT system and to allow other interested parties to apply for it,” Badriyah said.

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