INVESTOR PRESENTATION - Tenaga Nasional Berhad
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INVESTOR
PRESENTATION
COE – INVESTOR RELATIONS
01 INTRODUCTION TO TENAGA
02 REGULATORY
AGENDA 03 BUSINESS STRATEGY & DIRECTION
04 DIVIDEND POLICY
05 FY2020 OUTLOOK
06 APPENDIX
INTRODUCTION TO TENAGA
Regulatory & Shareholding Structure
REGULATORY & SHAREHOLDING STRUCTURE
PRIME MINISTER /
CABINET
Sabah Electricity
Sdn Bhd (SESB)
(83% owned by TNB)
Dependable Capacity:
Shareholders Policy Maker 1,223MW
Tenaga Nasional Bhd (TNB)
Holds
Ministry of Energy and
Ministry of Finance Natural Resources (KeTSA)
‘Golden
’ Share
a) Khazanah
b) PNB MALAYSIA
69.2% Implementor
c) EPF
d) Other Govt. Agencies ENERGY COMMISSION (Regulator)
- Promote competition
- Protect interests of consumers
Local Corp. & Retail 15.2% - Issue licenses
- Tariff regulation
Foreign 15.6% Sarawak Energy Bhd
(SEB)
Market Participant
Tenaga Nasional Berhad IPP
CONSUMERS
Note: Data / Info as at 30th June 2020 33
INTRODUCTION TO TENAGA
Regulated & Non-Regulated Business
Generation Grid/Transmission Distribution Network & Retail
Non-Regulated Business Regulated Business
TNB Generation Mix: Installed Capacity: Distribution Network Length:
Core Business
25,414MW Transmission Network Length: 683,008KM
Oil & Distillate
0.00% TNB: 14,561MW @ 57.3%
23,964KM
IPP: 10,854MW @ 42.7%
Solar 0.1%
Distribution Substations:
Generation Market Share:
Hydro 4.6%
61.5% Transmission Substations:
83,467
456
29.0% SAIDI:
Gas & LNG
Equivalent Availability Factor 48.1mins
(EAF):
88.2% Transmission System Minutes:
Customer Satisfaction Index (CSI):
Coal 66.3% Note: TNB installed capacity & Market Share 0.01 mins
are based on gross capacity 8.1
Source: TNB Data / Info as at June 2020
Main Subsidiaries
Non-Core Business
Non-Regulated Business
Operation &Maintenance (O&M) Renewables, Energy Efficiency & Other Services Education & Research
• TNB Repair & Maintenance Sdn. Bhd. (REMACO) • TNB Renewables Sdn. Bhd. • TNB Integrated Learning Solution Sdn. Bhd.
• GSPARX Sdn. Bhd. (ILSAS)
Manufacturing • TNB Energy Services Sdn. Bhd. • TNB Research
• TNB Engineering Corporation Sdn. Bhd. • University Tenaga Nasional (UNITEN)
• Tenaga Switchgear Sdn. Bhd. • Integrax Bhd.
• Malaysia Transformer Manufacturing Sdn Bhd. •
• Tenaga Cables Industries Sdn. Bhd.
Allo Technology Sdn. Bhd.
44
INTRODUCTION TO TENAGA
TNB Sectoral Sales Analysis*
Total
Unit Sold 53,535.7 GWH
0.9% 1.7% 2.1%
Total 25.0% 28.8%
Assets RM174.3bn
81.8%
Total 37.9% 32.1%
TNB: 9.3mn
Customers SESB: 0.6 mn
Total 35.3% 37.0%
Employees 35,878 17.1%
0.3%
NO O F C USTO ME R SA LES (RM) SA LES (G W H)
Industrial Commercial Domestic Others
Note: Data / Info as at June 2020
* Peninsular Malaysia only (TNB exclude SESB and other subsidiaries) 55
INTRODUCTION TO TENAGA
Electricity Demand in line with GDP Growth
GDP & TNB (Peninsula) Demand Growth TNB (Peninsula) Yearly Peak Demand
MW *
18,808
18,566
18,338
17,788 17,790
*Recorded at:
10 Mar’20
16,901 16,822 at 1630hrs
16,562
15,826
15,476
FY'11 FY'12 FY'13 FY'14 FY'15 FY'16 FY'17 FY'18 FY'19 FY'20
2QFY’20 2QFY’19 Variance (%)
Maximum
14,998.3 16,931.12 (11.4)
Demand (GWh)
Note:
i. Data / Info as at June 2020
ii. Peninsular Malaysia only (TNB exclude SESB and other subsidiaries) 66
INTRODUCTION TO TENAGA
Growing Renewable Energy Business– TNB is currently present in more than 5 countries
• 55% equity ownership in Vortex Solar Investments S.à.r.l,
United 24 operational solar PV farm portfolio of 365MW (May 2017)
United Kingdom • Tenaga Wind Ventures UK Ltd, 53 operational onshore wind
Kingdom portfolio of 26.1MW (Feb 2018)
• 30% equity ownership in GAMA Enerji A.Ș. (Apr 2016)
Turkey Turkey
• Assets include 853MW (gas), 117.5MW (wind) & 131.3MW (hydro)
Pakistan
Kuwait
• 6% equity ownership in Shuaibah Independent Water &
India Saudi Arabia Power Project (IWPP)(Aug 2005)
Saudi Arabia • REMACO O&M Services for 900MW Shuaibah IWPP (Jan
2010)
• REMACO O&M for 225MW Sabiya Power Generation &
Water Distillation Plant (July 2014)
Kuwait • REMACO O&M for Shuaiba North Co-Gen 900MW Power;
204,000 m3/day water (Sept 2013)
• REMACO O&M for 240MW Doha West Water Distillation
Plant (Nov 2016)
FOCUS ON GROWING RENEWABLE • Liberty Power Ltd 235MW (Sept 2001)
Pakistan • REMACO O&M Services - Bong Hydro Plant (May 2011)
ENERGY BUSINESS IN SPECIFIC MARKETS • REMACO O&M Services - Balloki Power Plan (July 2018)
BY LEVERAGING ON ITS INTERNATIONAL
India • 30% equity ownership in GMR Energy Ltd (Nov 2016)
AND DOMESTIC EXPERIENCE, • Assets include 1,915MW coal, gas and solar plants
CAPABILITIES AND ASSETS
77
INTRODUCTION TO TENAGA
TNB Shareholding Structure Top 10 KLCI Stocks by Market Capitalization
RM bil
Khazanah Nasional Berhad 84.4 (13.1%)
Maybank
18.4 97.1
17.0 66.3
Permodalan Nasional Berhad TNB (12.1%)
(PNB) 75.4
17.5
15.5 64.1
Employees Provident Fund Public Bank (15.1%)
Board (EPF) 75.5
5.6 6.9 49.6
Kumpulan Wang Persaraan
(KWAP) 27.3
(%) 1.2 Petronas Chemicals
58.8
(15.6%)
1.2
Other Government Agencies
25.7 14.5 48.3
IHH Healthcare +0.6%
48.0
Local Corporation & Retail 18.4 15.2 Hartalega Holdings
44.0 +138.3%
18.5
Foreign Shareholding Top Glove 43.4
Pacific, Africa, +260.5%
15.6 0.1% 0.01% Corporations 12.0
42.0 +0.9%
Europe,
Maxis
Asia,
41.6
24.5%
34.5%
35.3 (30.9%)
CIMB Group
51.1
Foreign Shareholding (%) North America,
40.9%
34.2 (8.3%)
MISC
37.3
30 Jun 2020 31 Dec 2019
22.8 28.3 24.4 24.1 20.8 18.4 17.6 16.9 16.9 15.6
Aug'15 Aug'16 Aug'17 Dec'17 Dec'18 Dec'19 Feb'20 Mar'20 May'20 Jun'20
Institutional: 15.58% Note:
Individual: 0.02%
1. Top 10 KLCI ranking by Market Capitalization as at 30th June 2020
2. TNB Latest Market Cap: RM63.8bil (3rd), as at 14th Sept 2020
Source: Share Registrar, Bloomberg and IR Internal Analysis 88
01 INTRODUCTION TO TENAGA
02 REGULATORY
AGENDA 03 BUSINESS STRATEGY & DIRECTION
04 DIVIDEND POLICY
05 FY2020 OUTLOOK
06 APPENDIX
INCENTIVE BASED REGULATION (IBR)
A Mechanisms For Tariff Setting With Incentives To Improve Efficiency & Greater Transparency
Non – Regulated
Regulatory Environment: (competitive bidding environment)
1. Clear and Transparent Regulatory Framework
Clear and transparent regulatory framework governed by the Energy
Commission provides investors with confidence in TNB’s cash flow visibility
2. Consistent and Clear Returns
Regulatory WACC of 7.3% provides consistent and clear return to debt and
equity holders
3. Shield against Uncontrollable Swings
Imbalance Cost Pass-Through mechanism shields Tenaga against
uncontrollable swings in input costs, with a review every 6 months
4. Incentives for Operational Efficiencies
Incentive / Penalty mechanism provides clear incentives for TNB to achieve
operational efficiencies
Regulated
Source: Energy Commission (EC) 10
10INCENTIVE BASED REGULATION (IBR)
Regulatory Period 2
Average Tariff by Entities (sen/kwh) Fuel Parameters
Base tariff for RP2 COAL USD75/MT (RM14.47/mmbtu @ RM4.212/USD)
(sen/kWh) RP1 : USD87.5.MT @ RM3.100/USD
LNG RM35/mmbtu
RP1 : RM41.68/mmbtu
REGULATED RM24.20/mmbtu (Jan’18 - Jun’18)
Single Buyer Single Buyer Grid System Transmission Distribution Customer Base Tariff GAS RM25.70/mmbtu (Jul’18 - Dec’18) RP2 Forecasted Gas
Generation Operations Operator Network service/ @1,000mmscfd RM27.20/mmbtu (Jan’19 - Dec’20) Utilization: 840 mmscfd
Retail RP1 : RM15.20/mmbtu – RM22.70/mmbtu
RP2 Parameters
Average Tariff by Sectors (sen/kwh)
WACC TARIFF CAPEX
46.93 7.3% 39.45 sen/kwh RM18.8bn*
Commercial RP1 : 7.5% RP1 : 38.53 sen/kwh (approved CAPEX)
47.92
RP1 : RM15.7bn
39.45 OPEX AVG. RAB
Base Tariff (Closing CAPEX)
38.53
36.85 RM18.2bn RM54.8bn *Special project approved
Industrial (avg. RAB in 2020
36.15 (approved CAPEX) ➢ 1.5 million smart meters in homes
RP1 : RM16.9bn ➢ 367,00 LED streetlights
32.95 RP1 : RM43.6bn
Domestic ➢ Fibre Optic network development for
31.66 RP2 RP1 (Closing CAPEX) (Closing RAB) energy security & reliability
RAB : Regulated Asset Based
11
11INCENTIVE BASED REGULATION (IBR)
Interim Year 2021
Regulatory Period Timeline
INTERIM YEAR
RP2 (2018 – 2020) 2021 RP3 (2022 – 2024)
2018 2019 2020 2021 2022 2023 2024
➢ Energy Commission (EC) has agreed for RP3 to be in 2022-2024, and RP2 to be extended
(FY2021 – Interim year).
➢ TNB is in discussion with EC on the parameters for the interim year in FY2021.
➢ This is to allow TNB and EC to understand and determine:
a) The starting base of demand and CAPEX for the next RP.
b) Better fuel prices forecast to minimise huge fluctuation in the ICPT.
12
1201 INTRODUCTION TO TENAGA
02 REGULATORY
AGENDA 03 BUSINESS STRATEGY & DIRECTION
04 DIVIDEND POLICY
05 FY2020 OUTLOOK
06 APPENDIXREIMAGINING TNB
TNB's strategic aspiration – a key enabler is the corporate structure
4 STRATEGIC PILLARS
4 STRATEGIC PILLARS
Future Generation Grid of the Future Future
Winning the Customer
Sources Proof Regulations
• Upgrading existing network
• Growing TNB’s renewable
infrastructure into a smart, • Enhance experience through all • Working together with key
capacity
automated and digitally-enabled customer journeys stakeholders towards a stable and
• Expansion of capacity into
network • Growth through innovation of sustainable regulatory landscape
selected international strategic
• Optimising network’s new solutions and service
markets with strong growth
productivity, efficiency and offerings
prospects
reliability • Strengthen digital presence via
• Improving performance of
• Leveraging innovation in the digital solutions, interactions and
existing generation fleet
network to transform customer enterprise
experience
TNB Power Generation TNB Retail
Sdn Bhd Sdn Bhd
Operation Date: Operation Date:
October 2020 (completed) January 2021 14
14TO BE A LEADING PROVIDER OF SUSTAINABLE ENERGY SOLUTIONS IN MALAYSIA AND INTERNATIONALLY
Our pledge in powering the lives of our customers and communities through renewable energy,
supporting Malaysia’s commitment in reducing the GHG emission intensity and environmental impact
Government Green Development Plan TNB Sustainability Commitments
TNB RE Target of 1,700MW by 2025
Malaysia RE Target by 2025 TNB RE Capacity
As at September 2020:
20%*
Total: 837MW
of total Installed Capacity
*exclude large hydro • International – 666MW
• Domestic - 171MW
Note: 1,700MW includes domestic and international RE assets, excluding domestic large hydro.
Current RE capacity inclusive of large hydro is 3,373MW: Domestic - 2,707MW; International - 666MW
The Group is committed to ensure that the revenue from the
Reduction up to coal generation plants does not exceed 25%
45% in GHGs
emission intensity
TNB has pledged not to invest in greenfield coal
of GDP compared to
2005 level by 2030 plant (Jimah East Power which was commissioned in
2019 is the last new coal plant for TNB)
15
15TO BE A LEADING PROVIDER OF SUSTAINABLE ENERGY SOLUTIONS IN MALAYSIA AND INTERNATIONALLY
Our journey towards transitioning into a cleaner and sustainable energy provider
TNB’s RE Capacity TNB’s RE Strategy
WIND International: International
• UK (TNB Wind Ventures): 26 MW
144 MW
• Turkey (GAMA): 118 MW
1) Renewable Energy Growth Strategy: Grow TNB’s Renewable Energy business
with a capacity target of 1000MW by 2021 through
Update: i. acquisitions leveraging on existing assets, capabilities & experience
Completed the acquisition of the remaining 20% stake in TNB Wind
Ventures, UK in March 2020 with a total combined capacity of 26.1 MW ii. develop greenfield RE project
2) Grow Utility in South East Asia (SEA): Grow revenue and returns through
International:
• UK (Vortex): 365 MW greenfield development and M&A across the utility value chain (RE, conventional
SOLAR • India (GMR): 26MW generation, beyond the meter business) leveraging of TNB’s core business
Domestic: experience and capabilities
527 MW
• Large scale solar: 80 MW 3) Tech Catalyst:
• Rooftop PV: Total 56 MW (secured capacity)
• Invest in new technologies that improve and value add to TNB’s core
Updates: business both domestic and international.
• Completed the acquisition of additional 5% controlling stake in Vortex
• Invest in Energy transition technologies to prepare TNB for a future
Solar, UK in September 2020
• Participated in the bidding for Large Scale Solar (LSS) 4 with maximum
decarbonized energy landscape
capacity of 50MW in Malaysia
Focus Market
BIOGAS & BIOMASS
Domestic: TNB’s growth strategy will focus on selected growth markets and regions where we
13 MW
• Biogas: 3MW have presence (UK, Europe and South East Asia such Vietnam & Singapore) and
• Biomass: 10MW specific asset classes/technology that are key to the Energy transition
International: Turkey (GAMA): 131 MW Domestic
HYDRO
MINI HYDRO + Domestic: 1) Win LSS - Largest driver which focuses on winning local LSS bids, exploration of
INTERNATONAL: 153 MW • Large Hydro: 2,536 MW new entry points through NEDA and Green Corporate PPA as well as expansion on
LARGE HYDRO: 2,536 MW • Mini Hydro: 22 MW Asset Management Services.
Updates (Upcoming Domestic Mini Hydro):
• Sg. Tersat, Kuala Berang (4MW), to be COD in Dec 2020 2) Secure Small RE - Focus on mini hydro, biogas and Waste to Energy through the
• Sg. Telom, Lemoi, Jelai Kecil (45 MW) – currently in negotiation existing Feed-In Tariff Scheme, unlock value through rooftop solar and other
• Sg. Pelus (26 MW) – currently in negotiation initiatives. 1616TRANSITIONING AWAY FROM COAL RELATED REVENUE
The Group is committed to ensure that the revenue from the coal generation plants does not exceed 25%
Breakdown of TNB's Group Revenue
0.2% 0.3% 0.3% 0.3% 0.3% 0.3% 0.3% 0.3%
2.6% 2.4% 2.7% 2.7% 2.6% 2.0% 1.8% 1.7%
12.6% 13.0% 10.8% 10.5% 11.0% 10.4% 11.4%
13.7%
17.2% 15.8% 22.1% 21.9% 21.2% 20.0% 19.5%
20.7% TNB has pledged not to invest in
any new greenfield coal plant
(Jimah East Power which was
commissioned in 2019 is the last
new coal plant for TNB)
67.4% 68.5% 64.0% 64.7% 65.5% 67.5% 67.1%
62.6%
The coal related revenue is
anticipated to reduce further as
the PPA for major coal plants are
expiring in 2030
FY2018 (A) FY2019 (A) FY2020 (F) FY2021 (F) FY2022 (F) FY2023 (F) FY2024 (F) FY2025 (F)
Other Revenue (Regulated Entities, Subsidiaries & Other Group Revenue) FY2021 forecast numbers have included the full potential of
Coal the last coal plant for TNB and Malaysia (Jimah East Power).
Gas Revenue from TNB Generation
Plants by fuel type (Domestic & FY2022 onwards, coal contribution to the Group's Revenue
Hydro will potentially diminish as new and more efficient gas plants
International)
Solar & Wind are commissioned in Malaysia. 17
17TNB’S ENVIRONMENTAL INITIATIVES
TNB Board of Directors is cognisant of the importance of ensuring sustainability is integrated in the
strategic direction of the organisation, decision making processes and operational performance
Developed Green House Gas Emission
The latest coal generation plants using Management System (GEMS), an
ultra-supercritical technology consume online system to record and analyse
less fuel per MWh electricity produced in raw emission data from TNB assets
comparison to conventional coal power
plant further contributing to lower carbon
emissions.
Promoting green energy by introducing optional
green tariff (myGreen+) and tradable RE
Certificate (MGATS)
50MW Large Scale Solar (LSS), cut Total Subscription 319,600 kWh with a
total of 146 customers as at 25th October
emissions by approx. 57,174 tCO2e/year,
2020
additional 30MW LSS to further reduce
emissions about 35,840 tCO2e/year after Renewable Energy Certificates of
COD in Dec 2020 1,568,488.197 tradable units as at
September 2020
Development on microalgae initiative
to reduce carbon dioxide (CO2)
Note : tCO2e (tonnes of carbon dioxide equivalent ) 18
1801 INTRODUCTION TO TENAGA
02 REGULATORY
AGENDA 03 BUSINESS STRATEGY & DIRECTION
04 DIVIDEND POLICY
05 FY2020 OUTLOOK
06 APPENDIXDIVIDEND POLICY
Distribution of dividend is based on 30% to 60% dividend payout ratio, based on the reported Consolidated
Net Profit Attributable to Shareholders After Minority Interest, excluding Extraordinary, Non-Recurring items
Current dividend policy effective FY2017
25% 27% 25% 50% 50% 56% 59%
140.0
4.3% 3.9% 3.8% 5.0%
2.3% 2.6% 2.2%
120.0 1.9% 3.0%
100.0 1.0%
80.0 -1.0%
50.0
60.0 -3.0%
40.0 44.0 23.0 20.0 -5.0%
20.0 19.0 19.0 22.0 -7.0%
30.3 30.0 22.0
10.0 10.0 10.0 17.0
0.0 -9.0%
FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020
Interim dividend per share (sen) Final dividend per share (sen) Dividend Payout ratio (%) based on
adjusted Group PATAMI
Special dividend per share (sen) Dividend Yield (%) - exclude special dividend
2001 INTRODUCTION TO TENAGA
02 REGULATORY
AGENDA 03 BUSINESS STRATEGY & DIRECTION
04 DIVIDEND POLICY
05 FY2020 OUTLOOK
06 APPENDIXFY2020 OUTLOOK
• Due to the MCO and Covid-19 pandemic, demand for Apr’20 fell by 15.7%.
• Since the implementation of Conditional Movement Control Order (CMCO), demand has started to
pick up as more businesses were allowed to operate.
Electricity • Moving forward, demand and sales are expected to further improve due to the implementation of
Demand Recovery Movement Control Order (RMCO).
• For the full year, we expect the overall electricity consumption to drop between 7-15% Y-o-Y.
• Nevertheless, earnings of our regulated revenue cap entities are guaranteed at demand growth of
1.8% - 2.0% as stipulated by the IBR guidelines in RP2.
• Our cash flow is resilient supported by the recent capital drawdown. Furthermore, we commanded
good rates in the exercise due to our robust and strong balance sheet.
• For 1HFY’20, the allowance for doubtful debt is RM137.7mil.
• As part of our capital management, the recent 2 programs (IMTN : RM10bil - 50 years program, ICP :
RM2bil - 7 years) announced in June 2020 will provide us further flexibility to raise fund when
Cash Flow required. On 12th August 2020, we have issued RM3.0 billion Sukuk Wakalah in relation to the IMTN
Program.
• We expect the collection to improve as the country navigates through the recovery phase highlighted
under PENJANA six-phase approach. We continue to prudently monitor the collection on a regular
basis.
22
22FY2020 OUTLOOK
• For 2020, we will be executing a strategy aimed at either protecting or creating value from
existing assets.
• Part of this strategy involves executing a growth strategy focusing on growing TNB’s
international Renewable Energy (RE) business leveraging on existing assets, capabilities and
experience.
International • Our immediate strategy is to grow TNB’s international RE business through :
1. acquisitions of operational assets
Business 2. greenfield development.
• The 2020 lockdown recession was expected to hugely impact energy industry in terms of demand
and supply shifts. Within this new setting, we see RE being a resilient energy source, where it has
increased its market share during the lockdown period. The resilience of RE is contributed by
market model dynamics and RE’s low marginal costs.
CAPEX RM9.5 – 10.0 bil • Regulated Recurring : RM5.0 – 5.5bil
• Others : RM4.0 - 5.0bil
We will continue to honour our dividend policy of 30% to 60% dividend payout ratio, based on the
Dividend reported Consolidated Net Profit Attributable to Shareholders After Minority Interest, excluding
Policy Extraordinary, Non-Recurring items.
23
2301 INTRODUCTION TO TENAGA
02 REGULATORY
AGENDA 03 BUSINESS STRATEGY & DIRECTION
04 DIVIDEND POLICY
05 FY2020 OUTLOOK
06 APPENDIXAPPENDIX
Electricity Demand by Sector - Lower electricity demand mainly from sluggish industrial and commercial sectors
2Q main contributors for the drop
Commercial
Industrial
Industrial:
Y-o-Y (15.3%) Y-o-Y (14.6%)
• Iron and steel
• Cement products
• Electric & electronic (0.1%) (28.3%)
(7.5%) (22.7%)
Commercial:
• Retails
• Educational
10,375
10,200
10,084
9,759
• Accommodation
9,769
7,435
10,509
11,359
12,037
11,458
11,549
9,302
Unit Sales (GWh) Growth 1Q 2Q 3Q 4Q
1Q 2Q 3Q 4Q
2019 Y-o-Y
Q-o-Q *includes Agriculture,
2020 Others* Mining & Public Lighting
Domestic
Y-o-Y (6.4%)
Y-o-Y 11.8%
Sector Mix (%) 1HFY’20 vs 1HFY’19
(9.2%) (3.4%)
5.8% 17.6%
32%
34%
37% 40%
8,302
559
6,707
7,093
7,060
6,973
6,526
577
636
578
600
614
1HFY’19
2% 24% 1HFY’20
1Q 2Q 3Q 4Q
1Q 2Q 3Q 4Q 29%
2%
Note: Data / Info as at June 2020 25
* Peninsular Malaysia only (TNB exclude SESB and other subsidiaries)
Industrial Commercial Domestic Others 25APPENDIX
Incentive Based Regulation (IBR) – Imbalance Cost Pass-Through (ICPT) Mechanisms Ensures TNB Remain Neutral
Base Tariff under IBR framework comprises of:
a) Opex, Depreciation of Regulated Assets & Tax Expenses of
Business Entities
- transmission, grid system operation,
Single Buyer operation, distribution
network and customer services
Base Tariff:
b) Power purchase cost charged by generators to the Single Buyer RP1 - 38.53 sen/kWh
RP2 – 39.45 sen/kWh
c) Return on regulated assets (rate base) of Business Entities
▪ Reviewed every 3 years
39.45
Imbalance Cost Pass-Through (ICPT):
a) ICPT is 6-monthly pass-through of variations in uncontrollable fuel
costs and other generation specific costs (imbalance cost) incurred
by utility for the preceding 6-month period
▪ Reviewed every 6 months
Principle for ICPT Calculation
Cost components comprise of
• The ICPT is calculated based on an estimated actual fuel cost and generation specific costs for a particular six (6)
months period against the corresponding baseline costs in the Base Tariff.
Source: Energy Commission (EC) 26
26APPENDIX
Incentive Based Regulation (IBR) – Imbalance Cost Pass-Through (ICPT) Comprises Two Components
Imbalance Cost
Pass-through (ICPT)
Fuel Cost Pass Through (FCPT) Generation Specific Cost
Adjustment (GSCPT)
Changes in Gas/LNG and Coal Costs Changes in:
PPAs Power Purchase Agreements • Other fuel costs such as distillate and oil
SLAs Service Level Agreements • All costs incurred by SB under the power procurement
CSTA Coal Supply and Transportation Agreement agreements (PPAs, SLAs and etc.) and fuel procurement
CPC Coal Purchase Contract agreements (CSTA, CPC,
GFA Gas Framework Agreement • Renewable energy FiT displaced cost
GSA Gas Supply Agreement
RP2
ICPT Surcharge Implementation Period
Jul – Dec’18 2.15sen/kWh Jan – Jun’19
Jan – Jun’19 2.55sen/kWh Jul – Dec’19
Jul – Dec’19 2.00sen/kWh Jan – Jun’20
Jan – Jun’20 0.00sen/kWh Jul – Dec’20
Source: Energy Commission, company presentations, company fillings
27
27APPENDIX
Incentive Based Regulation (IBR) – New Features in Electricity Tariff Review for RP2 (2018-2020)
*
Source: Energy Commission (EC) 28
28APPENDIX
Incentive Based Regulation (IBR) – IBR Entities
1
1
In RP1, these 2 entity are grouped as Price –Cap entity
Source: Energy Commission (EC) 29
29APPENDIX
Incentive Based Regulation (IBR) – Generation and Customer Mix
Generation Mix RP1 vs RP2 Changes in Customer Mix (%) in RP1 (2015-2017)
RP1 Base RP1 Actual
43.6% 40.8%
Coal Coal
44% 49%
35.1%
RP2 1% 1% 0.1% 34.1%
4%
Coal
Gas 20.6% 22.3%
33% Hydro
61%
RE Base IBR RP1 Average Actual IBR RP1
LTM Domestic Commercial Industrial
LSS
Made possible by improved coal plants performance and RP2 Forecasted Demand Growth: 1.8 – 2.0%
additional commissioning of coal plants.
Note:
LTM – Laos, Thailand & Malaysia Interconnection; LSS – Large Scale Solar Source: Energy Commission (EC)
30
30APPENDIX
International Acquisition - Four International Acquisitions to Support Aspiration
30% 30%
Equity interest of GAMA Enerji A.S. Equity interest of GMR Energy Limited.
Assets include a 853MW natural gas-
Assets include 1,915MW coal, gas and
fired plant, 117.5MW wind plants and
solar plants.
131.3MW hydro plants
Vortex Solar UK Tenaga Wind Ventures
55% 100%
Equity interest of Vortex Solar Equity interest of GVO Wind Limited &
Investments S.a.r.l. Blumerang Capital Limited
Assets include 24 operational solar PV Assets include 53 operational onshore
Farm across England and Wales with net medium wind turbines with a total
installed capacity of about 365MW combined capacity of 26.1MW
31
31APPENDIX
Existing - TNB’s Renewable Energy (RE) Assets
Others
Domestic (Peninsular Malaysia) International
Mini Hydro (22MW)
⚫
Kelantan
⚫ GSPARX Rooftop Solar (56MW) United Kingdom
(Total secured) Large Hydro
⚫ SJ Pergau (600MW)
Solar
⚫ TNB Vortex Solar (365.0MW)
Kedah Terengganu
Wind
Large Scale Solar Large Hydro ⚫ TNB Wind Ventures (26.1MW)
⚫ TNB Bukit Selambau (30MW) ⚫ SJ Kenyir (400MW)
⚫ SJ Hulu Terengganu (265MW)
Turkey
Perak Pahang Wind
Large Hydro ⚫ GAMA Wind (117.5MW)
Large Hydro
⚫ SJ WOH (150MW)
⚫ SJ Temengor (348MW)
⚫ SJ Bersia (72MW)
⚫ SJ JOR (100MW) Hydro
⚫ SJ Ulu Jelai (372MW) ⚫ GAMA Hydro (131.3MW)
⚫ SJ Kenering (120MW)
⚫ SJ Chenderoh (41MW)
Biomass
⚫ JV with Felda (10MW)
⚫ SJ Sg. Piah (67MW)
India
Selangor
Johor
Solar
Large Scale Solar ⚫ GMR Solar (26.0MW)
Biogas
⚫ TNB Sepang Solar (50MW)
⚫ JV with Sime Darby (3.2 MW)
Solar PV
⚫ Floating solar in Sg Labu WTP
(108kWp)
32
32APPENDIX
TNB’s Environmental Initiatives - Green Development
❑ UNITEN’s Smart UniverCity
❑ Expansion of Electric Vehicle Charging Network
✓ To create a sustainable ecosystem which provide competitive advantage
for TNB in moving into smart city environment. ✓ To expand the existing charging station infra (around 250 stations)
✓ The project focuses on 6 smart initiatives which are smart energy, smart under the ChargEV programme (managed by MGTC).
facilities, smart mobility, smart security, smart lifestyle and smart
education.
❑ TNB Centre of Excellence (CoE) for Solar Energy at the ❑ Maverick - Showcase of Net Zero Energy Home
Large Scale Solar (LSS) site in Sepang
✓ Showcasing Net Zero Energy Home Living in residential areas in
Cyberjaya, the project provides a physical experience for customers to
✓ The CoE will become a training centre for solar energy development and visualise how to self generate their own electricity.
technology, catering for TNB employees and external participants from public
and private sectors
❑ Smart Street Light Showcase Project at UNITEN Putrajaya
❑ Introduction of Electric Buses for UNITEN
Campus
✓ The project aims to develop a feasible business model for the operation ✓ A street lighting system integrated with communication facilities that allow it
of electric buses within the campus, such as vehicle leasing between the to perform various functions such as brightness control, surveillance and
Fleet Management and UNITEN. digital street signs.
33
33APPENDIX
TNB’s Social Initiatives
Economic & Social Education Career Development
212 households benefitted
from Projek Baiti Jannati and 700 students awarded More than RM183
Program Mesra Rakyat by YTN scholarship with a million contributed in
refurbishing or building new total amount of RM66.1 training & development
homes through a total million
contribution of RM9.96 million
RM21.2 million for
3,564 students from RM10 million spent to
TNB’s contribution of RM6 cultivate 705 youth
low-income families in the
million including sponsorships potentials through
fields of Science,
to the Malaysian Hockey PROTÉGÉ
Technology, Engineering
Confederation
and Mathematics through
Dermasiswa My Brighter
Approximately RM3.49 million Future (MyBF) Programme
has been allocated to Better 38,000 hours for
Brighter Shelter programme, Leadership Training &
provide accommodation via TNB has contributed a Total 1,085,160
dormitories whose members total of RM2.19 million training hours
are undergoing to 18 schools under the
treatment in the hospitals Pintar Schools Adoption
Programme
34
34APPENDIX
TNB’s Governance Initiatives
TNB is committed to operating in an ethical, transparent and responsible manner given the critical role we play in national
development and the number of stakeholders who are impacted by our business
TNB Board Committees Governance Pillars
Board Audit Committee Leadership & Effectiveness
Board Risk Committee
Internal Audit Function
Board Finance And Investment Committee
Board Long Term Incentive Plan Committee Relations with Stakeholders
Board Tender Committee
Statement on Risk Management &
Internal Controls
Board Integrity Committee
Board Nomination And Remuneration Committee Ethics, Integrity & Trust
35
35APPENDIX
TNB’s Governance Initiatives - Composition of BOD
CHAIRMAN EXECUTIVE DIRECTOR / CEO
DATO’ SERI DIRAJA MAHDZIR KHALID DATUK SERI AMIR HAMZAH BIN AZIZAN
Independent Non-Executive Directors (Total = 7) Non-Independent
Non-Executive Directors (Total =2)
NORAINI BINTI CHE DAN ONG AI LIN GOPALA KRISHNAN A/L DATUK RAWISANDRAN A/L
K.SUNDARAM NARAYANAN AMRAN HAFIZ BIN AFFIFUDIN
Expertise: Audit & Finance Expertise: Audit & Finance Expertise: Law Expertise: Business (Khazanah)
JUNIWATI BINTI RAHMAT HUSSIN DATO' ROSLINA BINTI DATO' IR NAWAWI BIN
ZAINAL AHMAD DATO' ASRI BIN HAMIDIN @ HAMIDON
Expertise: Project Management, Corporate (MoF)
Planning and Human Resource Expertise: Business Expertise: Engineering 36
36APPENDIX
Capital Management - New drawdown & FOREX translation increased the gearing, but within the optimal level
Statistics 30th Jun'20 31st Dec'19
RM Equivalent of Loan Value (bil) 1 Total Debt (RM' Bil) 47.3 45.4
Net Debt (RM' Bil)* 35.9 31.2
76.1%
1 Gearing (%) 45.8 43.4
Net Gearing (%) 34.8 29.8
36.0 Fixed : Floating 98:2 98:2
34.5
Final Exposure 98:2 98:2
2 Effective Average Cost of Borrowing
17.4% 5.00 5.06
(based on exposure) **
5.2% * Net Debt excludes deposits, bank and cash balances & investment in UTF
1.2%
7.9 8.2
** Inclusive of interest rate swap
0.1%
1
2.4 2.5 0.6 0.6 0.1 0.0 New drawdown of RM1bil for working capital purposes
RM USD JPY GBP OTHERS
2
Dec-19 Jun-20 Reduced due to lower interest rate of the new drawdown.
Note: Closing FOREX 30th Jun’20 31st Dec’19
Debt consists of Principal + Accrued Interest USD/RM 4.28 4.09
100YEN/RM 3.98 3.77
GBP/RM 5.25 5.37
USD/YEN 107.68 105.40
37
37APPENDIX
Financial Highlights
REVENUE (RM bil) EBITDA (RM bil)
50.4 50.9
47.4 18.4
44.5
14.8 15.5
13.4
22.5 9.3
FY'16 FY'17 FY'18 FY'19 1HFY'20 FY'16 FY'17 FY'18 FY'19 1HFY'20
PAT (RM bil)
7.32 6.91
4.45
3.75
1.41
FY'16 FY'17 FY'18 FY'19 1HFY'20
Note: FY2019 is after MFRS16 implementation 38
38APPENDIX
Technical Highlights
EAF (%) Transmission System Minute (mins)
04 05
89.9 1.5
88.1 88.5 88.2
83.4
0.4
0.3
0.2
0.0
FY'16 FY'17 FY'18 FY'19 1HFY'20 FY'16 FY'17 FY'18 FY'19 1HFY'20
Distribution SAIDI (mins)
49.7 50.2
48.2 48.1
44.2
FY'16 FY'17 FY'18 FY'19 1HFY'20 39
39DISCLAIMER
All information contained herein is meant strictly for the use of this presentation only and
should not be used or relied on by any party for any other purpose and without the prior written
approval of TNB. The information contained herein is the property of TNB and it is privileged
and confidential in nature. TNB has the sole copyright to such information and you are
prohibited from disseminating, distributing, copying,
re-producing, using and/or disclosing this information.
40THANK YOU
For further enquiries, kindly contact us at:
Investor Relations Office: Investor Relations Team:
Ms. Mehazatul Amali Meor Hassan
CoE Investor Relations
+603 2108 2126
Group Finance Division
Tenaga Nasional Berhad mehazatul@tnb.com.my
4th Floor, TNB Headquarters
Ms. Sakinah Mohd Ali
No.129, Jalan Bangsar,
59200 Kuala Lumpur, MALAYSIA +603 2108 2840
sakinah.ali@tnb.com.my
+603 2108 2128
Mr. Ahmad Nizham Khan
+603 2108 2034
+603 2108 2129
tenaga_ird@tnb.com.my nizham.jamil@tnb.com.my
www.tnb.com.my
Mr. Sathishwaran Naidu
+603 2108 2133
sathishwaran@tnb.com.my
www.tnb.com.my41You can also read
