KOTA KINABALU, Oct 14 — Sabah Electricity Sdn Bhd (SESB) needs to be a strong company and able to finance its own costs to ensure that the handover of electricity supply regulatory powers from the federal government to Sabah, on January 3 next year, goes smoothly.

Commenting on the handover as announced by Prime Minister Datuk Seri Anwar Ibrahim when tabling Budget 2024 yesterday, SESB chairman Datuk Seri Wilfred Madius Tangau said the company still needs help from the government.

He said SESB is currently operating at a loss as the purchase of power from independent power producers (IPPs) is at a rate of RM0.43 per unit, but sold to consumers at RM0.34 according to the tariff set by the Federal Government.

"SESB is not able to cover its own operating costs due to several factors causing the company to bear the extra cost. It can only generate and own 20 per cent of the basic electrical load requirement in Sabah.

"The balance is generated by IPPs before being sold to SESB. We need the ability to generate 70 per cent of the basic electrical load in order to resolve disruptions in Sabah,” he told reporters after officiating the Darau Main Distribution Substation (PPU) groundbreaking ceremony here today.

Yesterday, Anwar said that although regulatory authority is being handed over to the Sabah state government, the Federal Government will continue to support Sabah in strengthening the electricity supply industry through subsidies to Sabah Electricity Sdn Bhd (SESB) until the successful implementation of the SESB Transformation Plan within a seven-year period, extending until 2030.

Meanwhile, Madius said the construction of the Darau PPU, which is scheduled to be completed in January 2025, is expected to solve the problem of power outages in the Inanam area and its surroundings.

He said the PPU was built last May to increase the efficiency of power distribution as well as protect the electric power system, besides meeting the electricity supply demand in the Inanam, Kolombong and surrounding areas.

He said the project was financed by SESB and hoped that all parties involved, especially contractors, would carry out the construction works according to the schedule and specifications set.

"It is also important that SESB, as the Main Project Division, carry out periodic monitoring to ensure that the progress and quality of this project are according to plan,” he added. — Bernama