Sarawak Govt to buy Bakun Dam from Federal Govt

Good deal for KL, bad deal for S'wak people?

MIRI (Star) - The Federal Government has agreed to sell the multi-billion ringgit Bakun hydroelectric dam in Belaga to Sarawak. The decision also means that the proposed multi-billion ringgit undersea power transmission cable between Sarawak and peninsular Malaysia is now shelved.

Minister for Energy, Green Technology and Water Datuk Seri Peter Chin Fah Kui said Putrajaya and the Sarawak government would begin negotiations to determine the amount the state would have to pay for the dam.

“The Cabinet agreed recently to the Sarawak government’s proposal to buy the Bakun dam.

"We are now negotiating with the Sarawak government about the price, principally, with the Sarawak Energy Bhd (a subsidiary of the state government),” he told reporters here at the Sarawak United People’s Party premises here Friday.

Chin said the Federal Government would not make any profit out of the Bakun dam.

On the 670km-undersea cable project that would have cost RM9bil, he said it was off for now, since electricity from Bakun would be retained in Sarawak.

“Maybe in 10 or 15 years from now, when Sarawak has excess energy, the undersea cable will be constructed. This also means that since the power from Bakun will no longer be transmitted to peninsular Malaysia, we will have to build more power generation plants in the peninsula to make up for the “deficit’’ from Bakun.

“My ministry has already drawn up plans for at least two more coal-fired plants to be built in the peninsula,’’ he added.

The Bakun dam project, which is under the Ministry of Finance Incorporated, is now completed and ready for flooding. Its construction started in 1996 and the physical construction was ready this month.

The flooding of the dam reservoir measuring the size of Singapore island is scheduled to start next month.

Asked if Putrajaya was asking RM8bil for the dam, Chin said “the amount is not for my ministry to disclose as the project is under the Ministry of Finance”.

The overall cost of Bakun was officially put at RM7.3 billion, but due to cost overruns, compensation for delays and interests, the final cost of the dam is said to have escalated.

On the possibility of the peninsula now facing a power shortage, he said his ministry would try to prevent that from happening.

“If the peninsula had been assured of the power from Bakun, we would have at least 1,600 MWs to meet the needs of the industries and the people. To make up for the amount, we will have to rely on new power plants as soon as possible.

“The peninsula states cannot afford to build large dams. Therefore, my ministry has no choice but to approve two new coal-fired power plants that will produce 1,000 MWs each,’’ he said.

One of the plant will be in Manjong, Perak.

On a related matter, he said his ministry had enacted the “Renewable Energy Act 2010’’ to be tabled in Parliament soon.