2013-12-05 [FA][ ] Cypark to gain from new surcharge

source: [thestar online]

Cypark to gain from new surcharge

Cypark to benefit after the surcharge on electricity bill for RE Fund is revised from 1% to 1.6%.

PETALING JAYA: Renewable energy player Cypark Resources Bhd will be ensured a steady income flow with the revised surcharge on electricity bill for the renewable energy (RE) fund.

Cypark, the only listed renewable energy developer, is expected to benefit hugely from the revised surcharge and in tandem with the company’s growing capacity.

“Operation-wise, this won’t affect the plans of the company and its growth momentum should continue. What we see now is a stable flow of income from the enlarged fund in tandem with its renewable energy capacity that has reached 19MW as at the third quarter,” said an analyst.

He said the company had a target capacity of 60MW generated from its solar and biogas RE ventures, and expected strong earnings growth as and when this capacity comes onstream.

Attempts to contact group chief executive officer Daud Ahmad for comments was not successful.

In 2012, Cypark signed an MoU with First Myanmar Investment Co Ltd (FMI) to explore opportunities in the waste management and renewable energy sector in Myanmar. However, nothing had materialised yet.

CIMB Research analyst Faisal Syed Ahmad said the Myanmar project would not be a concern given that there were RE opportunities in Malaysia for the company to tap into.

For its nine-month financial period ended July 31, net profit rose 31% to RM26.9mil from RM20.5mil. Revenue rose to RM163.8mil from RM139.7mil previously. Its shares closed 2 sen higher at RM2.50, having appreciated by 56% year to date.

The Government on Monday revised the surcharge on electricity bill for the RE Fund from 1% to 1.6% for Peninsular Malaysia, effective Jan 1, 2014 following the review in electricity tariffs, which would affect about 25% of domestic consumers.

Sabah consumers, for the first time, would be imposed a surcharge of 1.6% in their electricity bills.

Monies collected for the RE Fund would be administered by the Sustainable Energy Development Authority Malaysia and used to pay RE players who generate electricity from RE sources through the Feed-in-Tariff (FiT) mechanism.

Currently, the amount of electricity generated from RE sources is 121MW, which is only 1% of total generated power.

The target is to generate 2,080MW by 2020.