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CEO's Message
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FY07/08 marked a new chapter in Tuas Power’s history, as we became the first power generation
company to be sold as part of Temasek Holdings’ divestment strategy. The sale was the culmination
of a rigorous selection process which eventually saw Tuas Power acquired by China’s largest
generation company, China Huaneng Group (CHNG).
It gives me great pleasure to congratulate CHNG for its successful acquisition of Tuas Power Ltd.
We are deeply honoured to join this prestigious family of companies, and on behalf of the
management and staff of Tuas Power, I would like to thank our new shareholder for placing
strong trust in us to take the Company to greater heights.
Performance in FY07/08
I am pleased to report that the net profit before tax for FY07/08 was $191 million. ROE was
13.2 per cent for the year. This was achieved under tougher market conditions due to the
entry of a new competitor into the electricity market and steep increases in oil prices.
• Generation
In spite of a marginally lower generation market share as compared with last financial year, we
were able to maintain profitability. Total units generated stood at 9689 GWh. Our steam units
maintained 100 per cent reliability while our Combined Cycle Plants achieved reliability
of above 99.9 per cent.
• Oil Tank Leasing
Demand for oil storage capacity remained healthy. The upgrading of our fuel oil receiving and storage
facilities started in early 2007 and was completed by May 2007. This contributed to improved
utilisation of the facilities.
• Retail
Despite increased competition in the electricity retail market, Tuas Power’s retail subsidiary
Tuas Power Supply Pte Ltd (TPS) managed to retain more than 80 per cent of its customers
in FY07/08. TPS achieved a market share of 22.6 per cent of customers who purchase
their electricity from independent retailers in the Singapore electricity retail market.
• Trading
FY07/08 was an extremely challenging year for trading due to steep volatility in fuel prices.
With a prudent risk management framework in place, the company was able to effectively
deal with the fluctuations in the electricity and fuel markets. High plant availability
and reliability also enabled us to maximise opportunities in the spot market.
• Business Development
Tuas Power Utilities continued to explore avenues to grow the multi-utilities business in Singapore.
An important milestone was reached with the commercial launch of our first large-scale
trigeneration plant built for customer Pfizer Asia Pacific Pte Ltd. The official handover of
the 5MW plant took place in November 2007. This was followed shortly by the securing of a
new cogeneration project in January 2008.
Green initiatives
Amid the continued growth of our businesses, we kept up efforts to make our operations more
environment-friendly. Total Carbon Dioxide emissions from Tuas Power’s plants were
kept low at 414g/kWh in FY07/08.
In line with our commitment towards environmental sustainability, we sponsored an Energy Research
Project at the Prototype Glasshouse managed by the National Parks Board. The sponsorship
amounts to S$500,000 and it comprises the installation of microturbines and an absorption
chiller, which employs energy-saving technology. This technology, if proven successful, will be
further developed for commercial applications.
We are also encouraging our customers to join us in going green. The Tuas Power Green Programme,
launched in FY07/08, encourages customers of TPS to improve their energy efficiency. The
response to date has been favourable, with companies such as City Developments Limited,
YCH Group and Shangri-La Hotel, Singapore, having signed up for the programme.
The road ahead
Tuas Power will continue to concentrate on the core business of power generation and
to maintain reliability of our facilities. On the retail side, TPS will stay focused on serving the
landlord-tenant segment and providing innovative value-added solutions to our customers.
Meanwhile, we continue to devote strong attention to the multi-utilities business to expand
and grow our portfolio. We will also explore repowering options and opportunities to grow
our business utilising existing plant infrastructure and by leveraging on the in-depth expertise and
strong track record of our new parent company.
Thanks and acknowledgments
I would like to thank the Board for its wise counsel, our stakeholders for their strong support,
and all of my colleagues at Tuas Power for their hard work, great ideas and excellent team spirit.
I also take this opportunity to pledge to our new shareholder that Tuas Power will continue
to be a reliable and responsible energy provider. We will strive towards the next level of success
and, with the solid backing of CHNG, we are well-positioned for greater achievements in
the future.
Lim Kong Puay
President and Chief Executive Officer
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