Thursday, October 2, 2008

Does Sarawak really need 12 dams and 7,000MW of power?

PETALING JAYA: Sarawak plans to build 12 hydroelectric dams to meet its future industrialisation needs. [The Star, 23/7/08]

The mega project will include the construction of new dams on the rivers of Ulu Air, Metjawah, Belaga, Baleh, Belepeh, Lawas, Tutoh, Limbang, Baram, Murum and Linau. The existing Batang Ai dam, on the other hand will undergo an extension.

With the Bakun dam already under construction, these dams will push Sarawak's output to 7,000MW by 2020; an increase of 600% from the current capacity.

However, Sarawak currently only consumes about 750 MW of power.

Image taken from Malaysiakini

Preliminary work on a RM3 billion dam in Murum in Sarawak has again put the spotlight on the government’s controversial scheme to build a string of 12 dams in the next decade to tap cheap electricity in the state. [Malaysiakini, 29/9/08]

The proposed Murum dam, which will cost RM3 billion to construct, had raised questions over the need for the state to have another hydroelectric power plant. On July 23, the Sarawak state government announced that they were planning to build 12 hydroelectric dams to meet future industrialisation needs.

Sarawak Energy Berhad (SEB), which the state government has a 65% stake, will fund the construction of the Murum dam. SEB has been in negotiations with Cahaya Mata Sarawak (CMS) and the multinational Rio Tinto Alcan to supply 900-1200 MW of electricity to power an aluminium smelter. Both CMS and Rio Tinto Alcan are in a consortium and is planning to build a US$2 billion aluminium smelter, not far from the Bakun and Murum dams.

CMS is in fact controlled by Sarawak Chief Minister Taib Mahmud's (image) family. The company shareholders include the chief minister's daughters, Jamilah Hamidah and Hanifah Hajar, son-in-law Syed Ahmad Alwee Alsree, and family-owned Majaharta Sdn Bhd, each with a 14% stake.

Taib's wife currently holds an 11% stake while both his sons, Sulaiman Abdul Rahman and Mahmud Abu Bekir own 9% each. On the other hand, the Chief Minister's brother-in-law, Aziz Husain is the managing director of CMS.

Was the Murum dam being built simply to power an aluminium smelter partially owned by the Sarawak Chief Minister's family or was it honestly intended to supply the state with cheap renewable energy?

Nonetheless, the question lies in the government's justification of turning Sarawak into a ginormous power plant. As reported, Sarawak does not need a surplus of electricity as the state's power consumption is well within it's current capacity.

The Bakun dam is expected to churn out 2,400 MW of electricity. With the huge output, the dam is theoretically capable of powering 3 Sarawaks, if based on the state's current power consumption. Hence, Bakun's output alone is already sufficient to satisfy Sarawak's need for power, well into the next decade.

The Bakun dam project was scheduled to be completed by September last year but was recently given an extension till June 2010 by the government. The delay had incurred extra costs of up to RM1.02 billion; mostly paid as compensation to contractors for the failure of the project to meet its dateline. The initial cost of the Bakun dam was RM4.5 billion.

The average cost of a dam would be, say RM3 billion. By the year 2020, the government would need to fork out about RM36 billion to fund all 12 dams in Sarawak - that is if all remaining dams are completed in time.

Sarawak's new mega project is definitely electrifying.