This Article Was Written By Energy Watch | 03.04.23 | 3:37 PM When Tenaga Nasional Berhad (TNB), Malaysia’s national utility, incorporated its power generation-related divisions in 2019, the utility giant did so with big plans in store for it. Remoulded into TNB Power Generation Sdn Bhd (“TNB Genco”), the internal restructuring was part of TNB’s strategy to increase its competitive power in both domestic and international markets. Most recently, speculations of a US$1 billion initial public offering (IPO) for TNB Genco made headlines, but the group quelled the claims – stating it would focus on decarbonising the subsidiary first. Tasked with powering the nation as well as leading TNB’s energy transition goals, TNB Genco certainly has its work cut out for it. Energy Watch explores in detail below how the subsidiary plans to lead the transition as a vehicle of TNB’s larger vision. Green (tech) is in, coal is old A major part of TNB’s Energy Transition Plan 2050 is its commitment to scale up renewable energy and repower old coal plants with new green technology. Through TNB Genco and TNB’s Strategy and Ventures Division (“SVD”), TNB aims to make green tech the largest capacity source for the nation, while aspires to completely remove coal from its generation mix by 2045. Under this roadmap, there will be ample opportunities to introduce new technologies over the next few decades: Combined Cycle Gas Turbine (CCGT) with hydrogen-ready technology, additional hydropower plants, and carbon capture utilisation and storage systems (CCUS) are some of the promising new technologies being explored. The recent Nenggiri hydroelectric project is the latest major one to come into fruition. To achieve its coal-free vision by the target date, TNB Genco has laid out a structured repowering strategy. For plants retiring before 2030, the company has planned to repower them using natural gas – a more sustainable alternative to coal – with an added hydrogen co-firing capability. This allows for a gradual yet steady transition into cleaner energy while reducing the risks associated with low fuel supply and the energy crisis. An ongoing project to repower the retired Sultan Ismail Power Station, Paka, and the development of New Kapar using highly efficient CCGT which is hydrogen-ready, is already underway. This project is one of the pioneering initiatives that will pave the path for hydrogen-ready technology by the end of the decade. For plants retiring 2030 onwards, green tech is set to clearly lead the way. The company is also pursuing the early retirement and replacement of selected coal plants to fast-track the transition to green tech. While the early retirement is still subject to shareholders’ approval, the aggressive strategy demonstrates the force and clarity of the company’s decarbonisation vision. Powering the Nation with Hydro for a Sustainable Future Alongside the exploration of green technologies to transform its generation towards a greener capacity mix, TNB Genco is also looking at emphasising the contribution of hydropower plants in its portfolio. Hydropower plays an essential role for the company in further reducing its emission intensity, contributing to TNB’s aim of achieving a 35% reduction in emission intensity by 2035 and net zero emissions by 2050. Part of its plans includes a new hydropower plant that is currently under development in Nenggiri, Gua Musang, Kelantan. The new hydro plant is expected to commercially operate starting 2027, delivering 300MW of clean energy which will reduce an estimated 0.3 million tons of emissions per year, equivalent to approximately the emissions of 70,000 cars per year. In addition to developing new hydro plants, TNB Genco is also implementing a Life Extension Program (LEP) for its retired hydro plants including one that has recently been granted by the government, the Sungai Perak Hydro Schemes with a total capacity of 649MW. Efforts to enhance its hydropower capabilities also include exploring the pump storage technology to increase the renewable energy generating capacity from its hydro plants. The company has conducted benchmarking visits to Luxembourg and Thailand to assess the commercial and technical viability of the pump storage and has begun engaging stakeholders such as regulators and off-takers. Hydro dams and reservoir serves a multitude of benefits beyond generating electricity. Aside from creating economic growth with a variety of recreational and eco-tourism opportunities, it acts as an efficient water catchment that provides clean water supply, irrigation for agriculture and industry and most importantly for Malaysia, potential flood mitigation solution. Green Hydrogen as an attractive clean fuel Green hydrogen continues to spearhead TNB’s more innovative ventures, which are being realised through close collaborations among TNB Genco, TNB’s Strategic Venture Division (SVD), and TNB Research Sdn. Bhd. (“TNBR”). As an energy vector or carrier, green hydrogen, which is produced using electricity from renewable energy resources, is recognised as one of the emerging technologies to accelerate decarbonisation efforts. Examples of sectors where green hydrogen could have significant roles include heavy road transport, shipping, aviation, agriculture and industries such as steel and cement production. Green hydrogen, with concrete national policy and incentive support from the government, could become a vital component not only to achieve Malaysia’s energy transition goals, but also spur new economic growth for the country to become part of the global green hydrogen supply chain. TNB is currently exploring potential areas across the hydrogen value chain to develop its green hydrogen capabilities. For TNB, green hydrogen will make clear inroads through co-firing initiatives by TNB Genco. New CCGT power plants will be developed with hydrogen-ready technology, where green hydrogen could be blended with natural gas and co-fired in gas turbines, resulting in electricity production with lower carbon emission intensity. For plants whose PPAs expire after 2030, TNB Genco plans to achieve up to 30% of green hydrogen blend with natural gas in the co-firing initiative. No doubt, incorporating such innovative technology will require a crystal clear strategy, as well as an in-depth understanding of both technical and commercial aspects of green hydrogen. TNB is currently exploring potential areas across the hydrogen value chain to develop its green hydrogen capabilities. To achieve this, TNB GenCo plans to establish partnerships with established players in the green hydrogen market to grow its internal capabilities and become a leading player in the industry. TNB aims to capture a 22% market share of domestic green hydrogen production by 2050, and this effort is intended to illuminate a pathway for achieving that goal.