LSS5 opens up opportunities for bumiputra entrepreneurs to compete

THE announcement by the Ministry of Energy Transition and Water Transformation (PETRA) through the Energy Commission (ST) that offers a solar quota of 2,000MW through a competitive bidding process under the Large Scale Solar Farm 5 (LSS 5) program will opens up opportunities for bumiputra entrepreneurs to compete in the renewable energy (RE) industry.

Bumiputera entrepreneurs involved in the industry described it as a bold step taken by the Deputy Prime Minister who is also the Minister of Energy Transition and Water Transformation, Datuk Seri Fadillah Yusof in including the bumiputra agenda in the industry.

According to them, he dared to open a new side in the RE industry in this country by allocating a special quota to bumiputera which had never been done before.

Managing Director Gading Kencana Sdn. Bhd., a bumiputra company involved in solar farms and solar photovoltaic installations, Datuk Ir. Guntor Tobeng said, previously there had never been a special package for bumiputra in the construction of LSS.

“But with the political will he has, this decision will open up a new dimension of involvement of bumiputra entrepreneurs and the RE industry.

“The benefits from this announcement will also be enjoyed by non-bumiputra RE industry players through collaboration in implementing the packages that have been set,” he said in a statement yesterday.

ST recently announced a bid for a solar quota of 2,000MW through a competitive bidding process under the LLS 5 program also known as LSS Petra.

In the tender note issued, ST said it is offering four packages with the first one with capacity up to 10MW which are reserved only for bumiputra.

Package 2 which is from 10MW to 30MW for companies or consortiums incorporated in Malaysia with the condition of ownership of at least 51 percent Bumiputera equity holdings.

For Package 3 and Package 4 which is between 20MW to 500MW for companies incorporated in Malaysia with the condition of ownership of at least 51 percent of local equity holdings or a consortium consisting of at least one local company incorporated in Malaysia and a foreign company with equity holdings local in the consortium at least 51 percent.

According to Guntor, previously bumiputra companies with capabilities and expertise found it difficult to enter tenders because they had limitations in terms of capital.

He said, with the conditions set based on this package, bumiputra companies can find partners from among non-bumiputras which will create a win-win situation for all parties.

For Package 3 and 4, he said, it helps to internationalize local RE companies through collaboration with international players.

“To implement a 500MW solar farm project, it requires a capital of more than RM1 billion. So, international companies can invest in local companies, including bumiputra-owned companies, which will encourage the inflow of foreign capital, as well as the transfer of technology,” he said.

In fact, he said, to develop a solar farm with a capacity of 10MW, it requires capital of around RM40 million, which injection of capital from outside will certainly help local companies.

“This step is important to open space for outside investors in RE to come and invest in local companies and establish collaboration as startups to develop solar farms.

“We entrepreneurs of the bumiputra RE industry are very grateful to Datuk Seri Fadillah for taking bold steps to ensure that the bumiputra economic agenda is also raised in this industry.

“This is a bold step that has been taken for the first time by any government leadership that involves bumiputra entrepreneurs and the RE industry,” he said. – SM