KOTA KINABALU, Oct 16 – The appointment of MSR Green Energy Sdn Bhd (MSR-GE) for a RM645 million battery energy storage system (BESS) project in Sabah went through a rigorous process before it was decided, said Sabah Electricity Sdn Bhd chairman Datuk Seri Wilfred Madius Tangau.

Faced with allegations of lack of transparency, Tangau said that the decision process was made by Tenaga Nasional Berhad as the parent company and involved more than just costs.

"As far as SESB is concerned, when the cost of the project is more than RM100 million, the decision will be brought to TNB. So, it’s not at our level. It’s at the TNB level.

"Second, this particular tender went through a very rigorous process. The tender was issued in November last year, before Christmas. Then we opened it in January until August. So, it took around eight months to decide,” he said.

Tangau said that the process had to consider more than just costs, and they had hired a consultant to understand the economics of the battery and storage energy system.

Warisan Assemblyman Datuk Junz Wong had recently brought up claims the MSR-GE tender was RM133 million more expensive than other tenders, which would ultimately result in higher costs to the consumers.

Wong also claimed that the company did not fulfil the technical and commercial requirements of the project.

Tangau said that their evaluation showed that the end total would be "about the same” and that the pricing of power was beyond SESB’s control.

He said some 21 companies attended the briefing for the tender, all which required a minimum paid-up capital of RM5 million. Six companies were shortlisted, including Sabah-based companies.

He also said that the shortlisted companies were required to be part of a consortium with international leaders.

"The selection process was really strict because this is the first such project in Malaysia,” he said.

MSR-GE, an associate company of Seal Incorporated Bhd was awarded the contract last September to develop a RM645 million battery energy storage system (BESS) project in Sabah’s east coast district of Lahad Datu.

The initiative involves the engineering, procurement and construction of a BESS with a capacity of 100 megawatts (MW) and an energy storage capacity of 400 megawatt-hours (MWh) in Lahad Datu, Sabah.

It is expected to increase the reserve margin of the Sabah grid in periods of peak demand and support the addition of new energy resources including large-scale solar.

MSR-GE later has roped in a China-based solar photovoltaic (PV) inverter and energy storage system provider Sungrow.

Construction is expected to begin soon, with the project scheduled to go into commercial operation by 30 June 2025.