(Reuters) -Malaysian utility Tenaga Nasional Bhd (TNB) said on Wednesday it was aiming for capital expenditure of about 20 billion ringgit ($4.48 billion) annually till 2050 to fast track its energy transition plans.
The investments will help Tenaga reach net zero emissions by 2050 and “open opportunities in more than doubling its earnings before interest and taxes (EBIT)”, Baharin Din, its president and chief executive officer, said in a statement.
Tenaga, which counts sovereign wealth fund Khazanah Nasional as its biggest shareholder, aims to grab a bigger share of the Malaysian clean energy market that it estimates to be worth between 65 billion ringgit and 80 billion ringgit by 2050.
Tenega plans to have its power generation unit TNB Genco account for 40 billion ringgit of it.
Last week, Reuters reported that Tenaga planned to begin the process next year for a potential $1 billion listing of the unit, citing sources close to the matter.
On Thursday, Tenaga said it estimates a two to three years preparation period for TNB Genco’s listing and will assess the suitability and timing for the IPO. Analysts have expected TNB Genco to be listed in two to three years.
“There are various other factors that TNB needs to consider to decide on the IPO,” Tenaga said in a statement to Reuters. “At the moment we are focused on improving operational performance and delivering on our Nenggiri hydroelectric plant.”
TNB Genco aims to achieve EBIT of 2.5 billion ringgit in 2025 and 3.4 billion ringgit in 2030, Tenaga said. The unit recorded an EBIT of 2.4 billion ringgit last year, it added.
Tenaga is also exploring gas and hydropower projects in Southeast Asia, with a target capacity of 800 megawatts by 2050, Baharin added.
Its new energy division will expand its renewable portfolio by targeting capacity of 14.3 gigawatts by 2050 with an equity investment of $7 billion, Baharin said.
Tenaga will also invest 90 million ringgit over the next three years on projects to spur domestic adoption of electric vehicles (EV), he said, adding that the company plans 500,000 cars by 2030, bringing in annual EV revenue of 1.25 billion ringgit.
($1=4.4630 ringgit)
(Reporting by Rhea Binoy in Bengaluru and Yantoultra Ngui in Singapore; Editing by Uttaresh.V, Clarence Fernandez and Rashmi Aich)
