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Infrastructure & PPPs in Malaysia - Q1 2024 Update

YOG INFRA Q1 2024 insight series

MALAYSIA has seen significant investments in development of data centres in recent months, including joint venture partnerships with international players in the sector. We also see emergence of new green hydrogen and clean energy proejcts in the country, along with a possible revival of SG-KL high speed rail link based on market interest.

Read the key developments in Infrastructure and PPPs in Malaysia in our latest insight series.

 

January 2024

MALAYSIA HIGH SPEED RAIL PPP DRAWS SEVEN PROPOSALS

A total of 31 firms across 7 local and international consortia have submitted concept proposals to Malaysian finance ministry-owned MyHSR Corporation (MyHSR) for the Kuala Lumpur-Singapore High Speed Rail project. In July 2023, MyHSR issued a request for information (RFI) from the private sector for the public-private partnership project to be developed in the design-finance-build-operate-transfer mode. The findings from the RFI evaluation will be presented to the Ministry of Transport and the Cabinet for deliberation.

If the response is positive, the country will move on to the second phase with the request for proposal stage to obtain detailed proposals from the selected consortia.


POWERCHINA TO DEVELOP GREEN HYDROGEN PROJECT IN MALAYSIA 

Semarak Renewable Energy Sdn Bhd (Semarak RE) and PowerChina International Ltd's unit, China Hydropower (Malaysia) Co Ltd., have signed a RM 1.88 Bn agreement to develop Malaysia's first large-scale green hydrogen production project utilizing floating photovoltaic power generation.

The joint venture in Perak will involve the development of green hydrogen production and storage by deploying floating photovoltaic power generation, contributing to the shift towards sustainable energy. The project's key objectives include the design, procurement, and construction of floating photovoltaics, hydrogen production units, and hydrogen storage units.


 

February 2024

GDS SIGNS CORPORATE PPA FOR MALAYSIAN DATA CENTRE

GDS Holdings has signed a 22.5 MWac power purchase agreement with Malaysian renewables developer, Cenergi SEA, to buy clean electricity for its large-scale data centre campus in Johor state. The 21-year contract involves supplying power to the Nusajaya Tech Park Data Centre Campus, which was commissioned in August 2023. Cenergi's solar farm is designed to produce 29.99 MWac, and is scheduled to turn operational in the fourth quarter of 2025. GDS Holdings is among the first batch of electricity buyers under Malaysia’s Corporate Green Power Programme.

GDS Nusajaya Tech Park Data Center Campus is the company's first in Southeast Asia. The first phase of the campus, consisting of 3 data centres, has a total net floor area of 22,500 sqm and power capacity of 69.5 MW. GDS has a goal to achieve net zero carbon emissions by 2030. In September 2023, it partnered with SK Ecoplant to develop hydrogen fuel cell solutions to power its planned data centre in Singapore. Cenergi is owned by infrastructure-to-property conglomerate UEM Group.

 

MALAYSIA CLEARS PENANG AIRPORT EXPANSION PLAN

Malaysia Airports Holdings Bhd (MAHB) has gotten the approval from the Cabinet to expand Penang International Airport which is expected to begin by the second or third quarter of year 2024. The expenses of the estimated over RM 1 Bn (USD 210.7 Mn) project would be borne by the national airport operator while the rest would likely be funded using the Airport Development Fund (ADF).

The ADF is part of the Operating Agreement between MAHB and the Malaysian government. It is a development trust account under Section 9 of the Financial Procedures Act 1957 [Act 61] to receive contributions from airport users, the public and also airlines, and does not involve contributions from government funds. The government had approved RM 93 Mn (USD 19.6 Mn) to fund land acquisition and infrastructure development for the airport expansion. The Penang International Airport currently has a capacity of 6.5 Mn passengers and the expansion will increase its capacity to 12 Mn passengers yearly.

 

MALAYSIAN UTILITY TO BUILD 2.5 GW OF HYBRID HYDRO-FLOATING SOLAR

Tenaga Nasional Berhad, a Kuala Lumpur-based utility, plans to install floating solar farms at its hydropower facilities. It targeting 2.5 GW of capacity to support Malaysia’s National Energy Transition Roadmap. Tenaga Nasional Berhad is set to build 2.5 GW of hybrid hydro-floating solar (HHFS) projects at its hydropower dams. It will initially install 30 MW at its Chenderoh Hydro reservoir and follow up with work at its Temenggor and Kenyir Hydro reservoirs.

The company has signed partnerships with state agencies to ensure that the HHFS development is carried out successfully and responsibly. The rollout will support Malaysia’s National Energy Transition Roadmap, which was released in year 2023. Using bodies of water for solar installation can conserve land usage, preserve land natural habitats, and reduce water evaporation.

 

BRIDGE DATA TO BUILD ITS LARGEST DATA CENTRE IN MALAYSIA

Bridge Data Centres (Bridge Data) is expanding its presence in Malaysia by acquiring new land in Selangor to build its third data centre, MY02, in Cyberjaya.  The new data centre is expected to be the largest among the 3 developments. In partnership with Cyberview Sdn Bhd (Cyberview), the expansion will increase Bridge Data's IT capacity by about 87 MW across 3 phases. Each phase involves constructing a three-story data centre.

Bridge Data's strategic investment will not only boost the growth of supporting businesses but will also have the potential to inspire innovation in various industries. By investing in key sectors, Bridge Data aims to drive economic growth and enhance competitiveness. This investment marks a significant step towards sustainable growth, job creation, and fostering a skilled workforce. In 2023, Cyberjaya witnessed a surge in data centre investments, solidifying its position as a global technology hub. It is currently home to 15 commercial and captive data centres including hyperscale, as well as the location for 90 per cent of Malaysia's co-location data centres.

 

March 2024

MALAYSIAN RAILWAY DEVELOPER LAUNCHES ISLAMIC FINANCING

Malaysia Rail Link has established an up to MYR 10.2 Bn (USD 2.2 Bn) Islamic Commercial Papers and Islamic Medium Term Notes Programme, with an option to issue Sustainable and Development Goals (SDG) Sukuk. The programme offers an investment opportunity to join a partial financing for the construction of the 665 km-East Coast Rail Link (ECRL) project. The programme encompasses 3 revolving credit facilities and is supported by 10 participating financial institutions.

The railway project, a joint venture between Malaysia Rail Link and China Communications Construction (CCCC), will cost MYR 50.3 Bn (USD 10.6 Bn) and is financed by a combination of soft loans by the Export-Import Bank of China, and Sukuk issuance by local financial institutions. The railway line, from Kota Bharu to the Integrated Transport Terminal Gombak, is scheduled to be completed by end-2026. Full completion from Gombak to Port Klang is scheduled by end-2027.

 

TNB AND SELANGOR GOVERNMENT COLLABORATE ON RENEWABLE ENERGY INITIATIVES IN MALAYSIA

TNB, in partnership with the Selangor State Government, is advancing towards renewable energy (RE) and sustainable projects, aligning with Malaysia’s net-zero emissions target by 2050. This collaboration was solidified with the signing of a Memorandum of Understanding (MoU).

Under the National Energy Transition Roadmap (NETR), TNB is leading 3 key projects, including five Centralised Solar Parks (CSP) across Peninsular Malaysia. The CSP initiative involves TNB Renewables, SMEs, State Entities, and Cooperatives, aiming to engage Bumiputera SME entrepreneurs in RE endeavors. The first CSP project, situated in Mukim Ulu Bernam, is set for completion by early 2026. Expected to offset 95,053 metric tons of carbon dioxide annually, this equals removing 21,152 vehicles from the road.

 

List of key transactions - Malaysia Q1 2024

Source: YOG INFRA analysis

 

ABOUT YOG INFRA

Our objective is to drive economic growth and make positive social impact through sustainable infrastructure development.

​YOG INFRA is an infrastructure focused financial advisory firm. We work with Developers and Development Finance Institutions (DFIs) and help them make informed investment decisions across infrastructure development lifecycle.

With our offices in Singapore, India and UAE, we work on projects globally, and the team brings strong experience in supporting development of infrastructure projects.


For more information about us, our service offerings and team, please visit www.yoginfra.com Contact us at info@yoginfra.com

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