KUALA LUMPUR (June 2): Aluminium and stainless steel kitchenware maker CAM Resources Bhd has obtained the green light to sell renewable energy to Tenaga Nasional Bhd (TNB) for a period of 16 years.

In a filing with Bursa Malaysia today, CAM said its wholly-owned subsidiary Future Atlas Sdn Bhd received approval from the Sustainable Energy Development Authority Malaysia (SEDA) for a 2.0000MW biogas plant to sell its renewable energy, commencing from May 24, 2019.

CAM said a power purchase agreement with TNB is expected to be signed in August this year at a fixed fee-in tariff (FiT) rate of 46.69 sen per kWh over the entire 16-year period.

The rate is conditional upon the use of locally manufactured or assembled gas engine technology and the use of biogas engine efficiency exceeding 40%.

The renewable energy plant, which will have an installed capacity of 2.2620MW, will be located in Taiping.

CAM said the project is expected to provide the group with a steady stream of income, while Future Atlas will also be eligible for Green Technology Financing Scheme (GTFS) application.

GTFS is a special financing scheme introduced by the government to support the development of green technology in Malaysia, the benefits of which include interest subsidies of 2% from the total interest rate charged, government guarantee of 60% on the total approved loan, and training provided to applicants to enhance their knowledge on green technology.

CAM said it will use both internally-generated funds and bank borrowings to fund the construction cost of the renewable energy plant.

CAM's share price was traded unchanged at 29.5 sen today, giving it a market capitalisation of RM55.79 million.