ACCELERATING A RESPONSIBLE ENERGY TRANSITION SAVE THE DATE 28-29 AUGUST 2023 KUALA LUMPUR CONVENTION CENTRE TNB Energy Transition Plan Powered by
2 TNB Energy Transition Plan cuts across the electricity supply value chain, anchoring on 3 key levers: decarbonisation, digitalisation & electrification. This transition calls for actionable items towards meeting TNB’s sustainability commitments while ensuring business growth ENERGY VECTORS ENERGY USAGE Renewable Energy Capacity Capture RE growth potential in domestic and international markets Embark on strategic partnership for new technology Adopt commercial capabilities in foreign markets to drive domestic RE growth Coal Generation Capacity Uplift value of existing plants Reduce coal generation capacity Increase gas and clean generation capacity Carbon Management Reduce scope 1,2,3 GHG emissions Capture emissions (CCS, CCU) Trade/offset Manage carbon pricing Smart Grid Enhance grid & network flexibility to enable higher penetration of VRE, DER & electrification Regional interconnection Expand cross-border interconnection allowing for a wider reallocation of RE resources in ASEAN power system Hydrogen Produce for applications in domestic power, industrial and mobility sectors, and for export market Energy Storage Stabilize the grid Manage grid’s peak demand Enable off-grid supply and peer-to-peer generation among prosumers Electrification Spur the development of low-carbon mobility ecosystem Energy Efficiency Provide energy audit services and integrate energy efficiency improvements on machinery, equipment & appliances Deploy energy monitoring system Prosumer Provide rooftop solar + storage solution Digital Platform Complement ET initiatives with digital platforms such as myTNB apps, EV charging platform, digital marketplace and green energy aggregation and trading platform Smart Cities Develop liveable, sustainable and resilient cities leveraging on technologies and integrated functionalities ENERGY SOURCES ENABLERS Policy Advocacy Funding for the Journey Green Supply Chain Digitalization Capability Building
Energy Sources initiatives are the key to achieve net zero in 2050, transitioning power generation to cleaner sources, with potential EBIT of RM1.4bn in 2025 Carbon Management Increase RE Capacity In 2022, TNB’s RE capacity has reached 3,767MW, a growth of 8% from 2021. For 2023 to 2025, RM8.4bn equity CAPEX is expected for acquisition and development of assets in UK/EU and APAC by New Energy Division (NED) The recent hydro projects awarded to TNB namely Nenggiri Hydro and Sg. Perak Hydro Life Extension Program (HELP) projects will add up 950MW into TNB RE capacity by 2027. Reduce Coal Generation Capacity Uplift value of existing plants through performance enhancement program, tracked and monitored by PMO IDP TNB GenCo exploring the viability of early retirement of coal plants Additional 3,600MW generation capacity in the pipeline from the repowering of Paka power plant and a new Combined Cycle Power Plant (CCGT) in Kapar TNB continue to reduce GHG emissions via energy efficiency, phasing down coalfired asset portfolio, and supply chain management TNB GenCo is collaborating with leading organizations to explore Carbon Capture & Storage technology for carbon reduction. TNB is assessing risk and opportunity on for Carbon Trading/ offset opportunities on the recent established Voluntary Carbon Market and On carbon tax, TNB will study the potential direct monetary risk impact to the business revenue and tariff mechanism. 3
Energy Vectors will spur sectoral reforms towards greener and reliable ecosystem Energy Storage Smart Grid The grid is a critical infrastructure to enable energy transition. ~RM7bn is required annually under IBR to enhance network flexibility in accommodating more VRE and DER, create a smart, automated, and digitally enabled system, and developing Green Energy Islands – Pulau Redang & Pulau Perhentian. Interconnection Taskforce has been established to study the feasible new interconnection options that will allow for a wider reallocation of RE resources and helps decarbonize ASEAN power system Hydrogen TNB has moved forward in exploring Hydrogen opportunities for decarbonization and new source of revenue TNB is collaborating with Petronas to develop the green hydrogen ecosystem and the whole value chain from the supply of green electricity, electrolyzers, compression, storage to transportation by 2030 Energy storage is a next big things after solar. TNB to play energy storage value chain empowering energy independence through GenCo, DN, Grid & Retail TNBR has an ongoing pilot project for Virtual Power Plant (VPP) technology, which utilizes software and energy storage to enable demand response 4
Energy Usage pillar helps to empower customers by giving them greater convenience & control, and unlocking new beyond kWh businesses for TNB Smart Cities Electrification TNBX has successfully commissioned and launched TNB Electron, the DC fast charging station at 3 location – R&R Ayer Keroh, R&R Tapah, and R&R Paka (LPT2) TNB is investing ~RM22 million in 2023 to spur the development of EV ecosystem, including deployment of 40 EV charging stations along Peninsular highway roads and trunk roads Prosumers GSPARX is providing the ‘extra’ push on renewable energy penetration while growing TNB’s revenue source. In 2022, GSPARX has managed to cumulatively secure 248MWp solar rooftop capacity, a growth of 115% CAGR as compared to 2019 For 2023, GSPARX aims to secure additional 145MWp solar rooftop capacity TNB Platinum complex is built using Building Information Modelling (BIM) technology and is environmentally friendly with Green Building Index (GBI) Platinum rating In enhancing TNB’s ESG positioning, REV is assessing to develop 600 acres landbank as Smart City Sandbox - integrating TNB’s existing smart infrastructure and solutions. 5
In driving towards successful value creation of our Energy Transition plan, 5 key enablers play critical roles Green Supply Chain Policy Advocacy TNB is continuously advocating for policies on incentivize emissions reduction, new renewable energy market beyond traditional PPAs, thirdparty access to RE, electrification, and adoption of new green technologies To enable successful energy transition inclusively, education is key and TNB commits to Malaysia Energy Literacy Program (MELP), launched by NRECC’s Minister on 1st Mar 2023 Funding the Journey Group Finance is preparing sustainable financing framework which embeds the use of proceeds and sustainability-linked funding, and a committee to evaluate and select eligible projects. Tax Department is exploring full potential of tax incentives on Energy Transition related initiatives P&SC has established supply chain pathway to promote responsible and ethical sourcing from ESG compliant vendors in a Sustainable Supply Chain Ecosystem. Next step is to help our supply chain managing emissions reduction – reduction of scope 3 emissions
In driving towards successful value creation of our Energy Transition plan, 5 key enablers play critical roles Digitalization Our digitalization landscape currently helps embracing energy transition across business entities through creation/collaboration of platforms on GHG emissions management system, EV charging platform, virtual power plant, and RE asset monitoring system TNB is working with partners to establish ESG data universe and digitalized ESG dashboard Capability Building Group HR is working closely with BEs in assessing the capability gaps and resource capacity requirements, to ensure that capable ET talents are in place to deliver our energy transition plan 7
The Energy Transition Conference should cement TNB’s position and intention to be at the forefront of the energy transition in Malaysia and APAC Position TNB as leader in Energy Transition at regional level ▪ Enhance TNB’s brand value for Energy Transition / ESG ▪ Provide platform for leaders in TNB to strengthen strategic alliance and partnerships amongst key energy players Position TNB as the driver of the Energy Transition agenda in Malaysia and Asia Pacific by featuring • Customer-driven sustainable solutions • Energy regulatory policies • Technological possibilities in transitioning into a greener energy ecosystem Stimulate local and regional market for energy transition ▪ Create market opportunities for TNB’s current or future sustainable solutions ▪ Provide platform for insight and ideas sharing on technological possibilities among technical experts Influence shareholders and regulators for policy change to shape energy transition in Malaysia Provide platform to deliberate on regulatory policies to support Malaysia and TNB to reach sustainability commitments among regional leading members of policy makers, financiers and industrial leaders Objective Expected Outcome
9 TNB’s inaugural biannual event, The Energy Transition Conference 2023, scheduled on 28 – 29 August 2023 at Kuala Lumpur Convention Center 1500+ Number of Participants 7,500 sqm Exhibition Gross Area 30 Plenary and Breakout Sessions 60+ Speakers 30+ Exhibitors Building Long-Lasting Connections with Key Opinion Leaders, Decision-Makers and Industry Captains
10 Our conference promotes cross-sectoral discussions on energy transition to accelerate responsible energy transition and effective collaboration. Future of Energy How can we enhance the flexibility and resilience of the grid infrastructure? What can we do to empower consumers and ease their adoption of a smarter and greener lifestyle? Green Mobility What are the main challenges and opportunities of transitioning to cleaner and sustainable fuel sources to power vehicles? What role do electric vehicles and other emerging technologies play in facilitating the shift to amore sustainable transport system? Sustainable Cities What does it take to create a sustainable city? How can cities reduce their carbon footprint and promote smart and efficient use of technology? Digitalisation How do digitalization and crossindustry collaboration fast track the energy transition? What are the key advantages of embracing digital technologies in energy efficient practices ?