Malaysia’s state-owned power firm Tenaga Nasional Bhd is said to be considering selling a minority stake in a planned renewable energy unit, Bloomberg reported on Monday.
The sale could raise $300 million to $1 billion from potential investors, which will be used to help the Kuala Lumpur-listed power firm fund its expansion into the renewable energy sector.
Tenaga’s chief new energy officer Mohd Zarihi Bin Mohd Hashim told Bloomberg that the utility firm’s renewable energy growth strategy involves establishing a pure-play entity.
The company aims to achieve net-zero emissions by 2050 and to be coal-free by the early 2040s.
In August, Reuters reported that Tenaga was planning to begin the process next year for a potential $1 billion listing of its power generation business.
The listing could be Malaysia’s largest IPO in a decade and the company, TNB Power Generation Sdn Bhd (TNB Genco), could be valued at about $4 billion.
TNB Genco started operation in October 2020 and owns 10 thermal power plants, three hydroelectric schemes, two large solar farms, and one port in Malaysia, according to its website. Its generating assets have a total capacity of 15,882 megawatts.
Tenaga has aimed at turning TNB Genco into a greener power generator as part of its ambition to grab a bigger share of the clean energy market, its president and CEO, Baharin Din, said in a statement on Aug. 2.
Tenaga is the largest electricity utility in Malaysia and a leading utility company in Asia with an international presence in the UK, Kuwait, Turkey, Saudi Arabia, Pakistan, India, and Indonesia.
It serves 9.2 million customers in peninsular Malaysia. Sabah, and Labuan.
In October, Tenaga disclosed that its wholly owned subsidiary has received a letter of intent from Malaysia’s Ministry of Energy and Natural Resources for the development of a 2,100-megawatt combined cycle power plant in Kapar, Selangor.
The firm said the project is aligned with its net zero emissions aspiration by 2050 and the government’s commitment to achieving carbon neutrality by 2050.