KUALA LUMPUR (May 10): Stocks of solar energy-related companies had a lukewarm response following news of the government’s plan to lift the 18-month ban on renewable energy (RE) exports, possibly waiting on Putrajaya to settle the details.

An observation of Bursa Malaysia's Wednesday (May 10) morning trade showed Solarvest Holdings Bhd rose half a sen or 0.58% to 87 sen, Cypark Resources Bhd gained two sen or 2.72% to 75.5 sen, Samaiden Group Bhd grew one sen or 1.08% to 93.5 sen, and Uzma Bhd increased half a sen or 0.83% to 61 sen.  

Citaglobal Bhd was trading unchanged at RM1.44, and YTL Power International Bhd was also unchanged at RM1.10.  

Meanwhile, VSolar Group Bhd slid half a sen or 50% to 0.5 sen, Pekat Group Bhd was down one sen or 2.47% to 40.5 sen, Mudajaya Group Bhd weakened half a sen or 2.56% to 19 sen, and Kejuruteraan Asastera Bhd dipped half a sen or 1.61% to 30.5 sen.  

In a note on Wednesday, MIDF Research commented that the government’s plan to review the current RE export ban — in place since October 2021 — is positive, seeing that Singapore aims to import up to 4GW of clean electricity by 2035 to make up around 30% of the country’s electricity supply.  

The firm said the Singapore’s Energy Market Authority (EMA) has issued another request for proposal (RFP) for 1.2GW of imports to begin in 2027, with a Dec 29 submission deadline. MIDF Research said the RFP has attracted 20 proposals from four countries, namely Malaysia, Indonesia, Laos and Thailand.

The firm added that there are attractive market prices for RE. It said Singapore’s average wholesale electricity prices stood at S$0.22/kwh (RM0.74/kwh) in January, while regulated retail tariff by EMA is set at S$0.29/kwh (RM0.96/kwh).  

“Again, these are predominantly represented by gas power plant capacity. Retail ‘green electricity’ plans, typically comprising solar and carbon neutral electricity, range from S$0.32-0.45/kwh (RM1.07-1.50/kwh). These compare well against Malaysia’s base tariff of RM0.39/kwh (essentially retail tariff) and LSS4 (Malaysia’s fourth round of large scale solar awards) tariff of ~RM0.20/kwh (essentially wholesale tariff),” MIDF Research said.  

On its coverage of YTL Power, the research house recommended a “buy” with an unchanged target price at RM1.12 as it believes the RE export ban review paves way for the group to participate in upcoming power import tenders by the Singaporean authority.  

“YTL Power has a strong advantage versus Malaysian peers, given that it is the only Malaysian company operating electricity generation and retailing in Singapore,” MIDF Research said.  

It highlighted that YTL Power acquired a 664ha land in Kulai, Johor, in September 2021 to develop the land into a large-scale solar power plant with 500MW capacity powering its planned green data centre.

“The provision of green data centre services to Singaporean multinational corporations provides higher value-added than outright electricity sales, in our opinion, but we believe YTL Power could consider alternatives for its planned power export to Singapore.

“This includes sourcing power from third parties with Seraya (electricity producer YTL PowerSeraya Pte Ltd in Singapore) focusing mainly on retailing to reduce capital expenditure requirement, or outright acquisition of new land banks for new solar farm setups,” MIDF Research said.

Read also:
Govt lifts RE export ban, details yet to be ironed out