YTL Power International Bhd announced recently that it is partnering with KDEB Waste Management Sdn Bhd to develop a 58 megawatt (MW) WtE plant on a 245-acre site in Rawang, Selangor. The proposed RM4.5bil plant will use municipal waste from six areas to generate electricity.
In late September, the country’s largest power generation plant using landfill gas began operations at Bukit Tagar Enviro Park (BTEP), Hulu Selangor. The plant, which will convert methane gas from solid waste into RE, is connected to the national grid and has the capacity to generate 12 MW of energy. This is enough to power 4,000 domestic homes.
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The government plans to install a WtE energy plant in every state in line with Malaysia’s aim to be a RE powerhouse by 2035.
The country generates more than 40,000 tonnes of waste daily, which can be turned into RE and sold. Currently two big concessions to build WtE are in the offing – at Bukit Payong, Batu Pahat, Johor and Sungai Udang, Melaka. According to reports both plants are required to have a minimum capacity of treating and processing 800 tonnes of municipal solid waste (MSW) per day. Rumours has it that independent power producer Malakoff Corp Bhd has won the contract for the development of the Sungai Udang plant. Malakoff has a presence in waste management via Alam Flora Sdn Bhd, which it acquired from sister company DRB-Hicom Bhd in 2019.
The group intends to expand its RE growth by achieving an RE capacity of 1,400 MW by 2031 and a recycling rate of 15% to 20% from the waste collected by Alam Flora.
One listed company big into WtE is Cypark Resources Bhd. The company had received a 25-year concession agreement in 2015 to build and operate the 20 MW Ladang Tanah Merah plant in Negri Sembilan, which began operations on 14 Dec 2022. Although the WtE segment recorded a revenue of RM9.2mil in the quarter ended June 30, (6Q23 as Cypark changed its financial year end from Oct 31, 2022 to April 30, 2023), it is still loss-making due to impairments made in relation to the WtE plant.
Meanwhile, other listed players such as Citaglobal Bhd and reNIKOLA Holdings Bhd are vying for a piece of the action. In the case of Citaglobal, it is partnering with Shanghai-based SUS Environment Co Ltd, a developer and operator of WtE plants to explore the potential and feasibility of developing such power plants in Malaysia.
Currently, there are three main concession companies dealing with MSW, including Alam Flora that manages Kuala Lumpur, Putrajaya and Pahang. SWM Environment Sdn Bhd manages the southern region (Negri Sembilan, Melaka, Johor), while E-Idaman Sdn Bhd covers the northern region of Kedah and Perlis.
Where unlisted companies go, Worldwide Holdings Bhd is undertaking the development of the Jeram Wte Project in Selangor. According to a recent press release from the company, this project will collectively process an impressive 3,000 tonnes per day of solid waste and generate about 50 MW of clean energy. WtE is widely in use in developed countries like Japan, South Korea and northern Europe.
The concept is making inroads in South-East Asia with Thailand planning to build 79 WtE plants in the coming years, while at least 17 such plants are being proposed for Indonesia.
No one mentions about the WtE plants that have folded. Some have lost more than RM100m for a plant. As in any project, the critical factors include: quality of input; technology that is robust; management of the revenue stream and operating costs that reflect the feasibility studies. Only when you get the ingredients right it becomes a goldmine.
Reference:
WtE’s space heats up, Gurmeet Kaur, The Star, 30 September 2023
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