Tenaga Nasional Bhd. (TNB)

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Tenaga Nasional Bhd (TNB) was the Malaysian national electricity utility. In June 1992, 23 percent of TNB's shares were sold on the Kuala Lumpur Stock Exchange for US$1.2 billion. In 1992 TNB's primary shareholders include: state-owned Khazanah Nasional Bhd. (38.981%); Ministry of Finance Inc. (17.134%); Bank Negara Malaysia (8.226%), the central bank; Amanah Raya Bhd. (5.224%); and the foreign-based Cartaban Nominees S.B. (4.656%). The government also holds a golden share. In 2005, TNB’s primary shareholders were: Khazanah Nasional Berhad (36.41%), Employee Provident Fund Board (9.24%), Amanah Raya Nominees (Tempatan) Sdn Bhd (7.46%), and Bank Negara Malaysia (7.19%). Further privatization of majority of shares was planned, but only 25% of TNB was private by December 1997. TNB had enjoyed monopoly rights for all power generation, transmission, and distribution activities in Malaysia until licenses for 6 IPPs were issued in 1994. The Government of Malaysia has announced plans to restructure TNB whose sole activity would be power transmission. Under this plan, power generation assets would be transferred to Tenaga Nasional Generating, from which TNB would buy power. TNB will, however, continue to hold its 20 percent equity position in all IPPs, except for the Telok Gong power plant (Powertek IPP). In addition to generation plants owned directly by TNB, TNB also set up a wholly-owned subsidiary Tenaga Janamanjung Sdn Bhd to develop a 2100-megawatt coal-fired power station at Manjung in Perak State. The project was expected to cost US$ 1.3 billion. In July 1999, TNB signed a $680 million loan agreement with the Midland Bank of the UK. to finance the project. TNB said that about $400 million of the project could be met by equity financing and the remainder through bonds. The first 700 MW entered service in April 2003 with the remaining two units entering service in August/September 2003. Alstom Power was been awarded a $1 billion EPC contract. A PPA has also been signed for TNB to buy the power at 3 cents/kWh. In 2005, TNB had a total generation capacity of 11,498 MW from 6 thermal and 3 major hydro power plants and accounts for two-thirds of the total capacity in Peninsular Malaysia. TNB owned and operated the 132kV, 275kV and 500kV transmission network for Peninsular Malaysia, which were connected to the Singapore and Thailand networks. TNB owned and operated the Peninsular Malaysia Distribution network, providing power to roughly 6,500,000 customers (2005). Finally, TNB owned a stake in a wide range of energy sector businesses in Malaysia, including an 80% stake in Sabah Electricity (the energy utility for Sabah State). TNB purchased power from 6 IPPs for sale on to consumers: YTL Power, Malakoff Bhd, Powertek, Ranhill, Sime Darby and Genting Sanyen. Roughly 40% of TNB’s operating costs were energy purchases from IPPs. www.tnb.com.my