SANDAKAN – The state government must consider that Sabah Electricity Sdn Bhd (SESB) is financially troubled before taking over the company, said SESB chairman Datuk Seri Wilfred Madius Tangau.
He said to acquire SESB, Sabah would have to purchase 80% of the shares from Tenaga Nasional Bhd.
“The federal Finance Ministry is holding the golden share as a government institution that is providing RM1 billion allocation in the form of Tariff Support Subsidy and fuel subsidy.
“SESB is fully dependent on the subsidy from the federal government to operate. SESB is technically bankrupt considering that the electricity tariff sold to the users (RM0.34 per unit) is lower than the cost (RM0.43 per unit) used to purchase or generate electricity.
“In other words, SESB is making a loss of almost RM0.10 per unit of electricity sales to users. To cover this loss, the federal government has been providing a subsidy, which amounts to RM800 million to SESB just last year alone.
“Hence, the Sabah government must also consider, overcome, and think about this challenge in the effort of taking over SESB,” he said in a statement today.
Tangau, who is also Upko honorary president, said he was confident that the Sabah government was capable of acquiring the company in seven years if the SESB Transformation Plan were to be implemented successfully.
Yesterday, Chief Minister Datuk Seri Hajiji Noor said the state government was aiming to fully own SESB seven years from now, since the federal government would no longer provide the subsidy after that.
Tangau welcomed the delegation of power to administer the electricity supply from Putrajaya to the Sabah government after three bills were passed at the state assembly’s special sitting yesterday.
He said the three bills – the Sabah Energy Commission Enactment 2023 (Amendment 2024), the Electricity Supply Enactment Bill 2024 and the Sabah Renewable Energy Enactment Bill 2024 – were passed right on time in the process of power decentralisation. – January 4, 2024