TNB Got Screwed - Just Like The Public.
Yup! No gimmicks here. TNB got right royally screwed by the government then, and we are paying the price for that now.
Says who? Says former TNB executive chairman Tan Sri Ani Arope, who headed the national utility from 1990 to 1996! You can't get a better person than the boss of TNB at that time to spill the beans. Why he has come clean now or why The Star, an otherwise pengecut newspaper dared to publish it needs a little thinking. More on that later.
About the deal with the IPPs he says:
TNB had plans in place to pump out more energy by building plants in Pasir Gudang and Paka. Financing was no problem and our credit standing was very high. We had the land acquired and were ready to move in and plant up. But we were told by the Economic Planning Unit (EPU) that it had its own plans. Then it surfaced that it wanted to privatise the power plants.
When the generous terms were given to the IPPs, all my other peers around the world asked what was happening. They said they would like to have a share in the IPPs. They said (the contracts to IPPs) were “too darn generous.'' (The terms) were grossly one sided.
****Now this is interesting. To a question 'how was the Malaysian model of IPPs created?' he replied - Ask our previous Prime Minister.
What does he mean ask the former PM? Simple. It was an order from the top. TNB was asked to sign a practically 'blank' letter. He elaborates - There was no negotiation. Absolutely none. Instead of talking directly with the IPPs, TNB was sitting down with the EPU. And we were harassed, humiliated and talked down every time we went there. After that, my team was disappointed. The EPU just gave us the terms and asked us to agree. I said no way I would.
It gets a little dicey here.
Question: What about the pricing and terms of the contracts?
Answer:It was all fixed up. (They said) this is the price, this is the capacity charge and this is the number of years. They said you just take it and I refused to sign the contracts. And then, I was put out to pasture.
Question: How were you affected by the process of awarding the IPP contracts?
Answer: I felt sick. It was morally wrong and not fair. If it is legal and not fair, I will not do it. If it is fair and illegal, I still won’t do it. It has to be legal and fair.
We work for the consumers, workers and shareholders. TNB is morally obligated to these three, but the consumers come first, otherwise we won’t be around. It is then the workers and the shareholders.
When I said that, they said ‘Dia ingat bapak dia-punya’ (He thinks this is his father’s company). This job is an amanah (trust). You are entrusted with this responsibility and you carry it out to the best of your ability. I do not want somebody to come and urinate on my grave. In the Malay culture, that is about the worst insult they can do to a man.
****There have been allegations time and again that Mahathir directly interfered in the working of many departments including the ACA (Remember the former DG of ACA and his open admission in court that Mahathir ordered him not to investigate a senior civil servant who was later appointed as governor of Bank Negara?) This is another such accusation. To my earlier question why now and why The Star? Again this is just speculation. Now that Mahathir is beginning to be a pain for the government what with his constant complaints and tirades perhaps it is someone in the government who is indirectly responsible for 'leaking' such damning information; first by giving Ani the green light to start 'singing' and second by providing a much needed 'backbone' to The Star for publishing it.
Well whatever the reason one thing is crystal clear. We along with TNB got shafted pretty good.
(You can read the full report in Starbiz)
Says who? Says former TNB executive chairman Tan Sri Ani Arope, who headed the national utility from 1990 to 1996! You can't get a better person than the boss of TNB at that time to spill the beans. Why he has come clean now or why The Star, an otherwise pengecut newspaper dared to publish it needs a little thinking. More on that later.
About the deal with the IPPs he says:
TNB had plans in place to pump out more energy by building plants in Pasir Gudang and Paka. Financing was no problem and our credit standing was very high. We had the land acquired and were ready to move in and plant up. But we were told by the Economic Planning Unit (EPU) that it had its own plans. Then it surfaced that it wanted to privatise the power plants.
When the generous terms were given to the IPPs, all my other peers around the world asked what was happening. They said they would like to have a share in the IPPs. They said (the contracts to IPPs) were “too darn generous.'' (The terms) were grossly one sided.
****Now this is interesting. To a question 'how was the Malaysian model of IPPs created?' he replied - Ask our previous Prime Minister.
What does he mean ask the former PM? Simple. It was an order from the top. TNB was asked to sign a practically 'blank' letter. He elaborates - There was no negotiation. Absolutely none. Instead of talking directly with the IPPs, TNB was sitting down with the EPU. And we were harassed, humiliated and talked down every time we went there. After that, my team was disappointed. The EPU just gave us the terms and asked us to agree. I said no way I would.
It gets a little dicey here.
Question: What about the pricing and terms of the contracts?
Answer:It was all fixed up. (They said) this is the price, this is the capacity charge and this is the number of years. They said you just take it and I refused to sign the contracts. And then, I was put out to pasture.
Question: How were you affected by the process of awarding the IPP contracts?
Answer: I felt sick. It was morally wrong and not fair. If it is legal and not fair, I will not do it. If it is fair and illegal, I still won’t do it. It has to be legal and fair.
We work for the consumers, workers and shareholders. TNB is morally obligated to these three, but the consumers come first, otherwise we won’t be around. It is then the workers and the shareholders.
When I said that, they said ‘Dia ingat bapak dia-punya’ (He thinks this is his father’s company). This job is an amanah (trust). You are entrusted with this responsibility and you carry it out to the best of your ability. I do not want somebody to come and urinate on my grave. In the Malay culture, that is about the worst insult they can do to a man.
****There have been allegations time and again that Mahathir directly interfered in the working of many departments including the ACA (Remember the former DG of ACA and his open admission in court that Mahathir ordered him not to investigate a senior civil servant who was later appointed as governor of Bank Negara?) This is another such accusation. To my earlier question why now and why The Star? Again this is just speculation. Now that Mahathir is beginning to be a pain for the government what with his constant complaints and tirades perhaps it is someone in the government who is indirectly responsible for 'leaking' such damning information; first by giving Ani the green light to start 'singing' and second by providing a much needed 'backbone' to The Star for publishing it.
Well whatever the reason one thing is crystal clear. We along with TNB got shafted pretty good.
(You can read the full report in Starbiz)
posted by The Malaysian. at 6/06/2006 04:33:00 PM
2 Comments:
The Tan Sri has confirmed what a lot of Malaysians have known for a long time - the IPP deal is a rotten one. Jeff Ooi posted a paper by Stanford University, which is an interesting background read to understand "The IPP Investment Experience in Malaysia".
When business is conducted in an environment that doesn't take into account real-world free market economics, a blow-up like this is no surprise.
Ultimately, it's the common consumer that has to bear the brunt.
pls, ani arope, dun throw stones and hide ur hand. we all know tnb isnt the best managed of all companies, so dun put the blame on somebody else (tho this looks fishy alrite). a black out we had last year, remember?
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