In an announcement to Bursa Malaysia today, Jentayu Sustainables Bhd and Telekosang Hydro One Sdn Bhd (TH) said the prerequisite tests, overseen by Sabah Electricity Sdn Bhd, were for the commercial operation of the power plant.

The TH1 is Malaysia’s largest privately-owned cascading ROR hydropower plant. It is also the first such project to be financed by a greenfield mini-hydro SRI sukuk, the companies said in the announcement.

“Based on the tariff rate of 24 sen per kWh under the renewable energy power purchase agreement, TH expects an estimated cash flow of more than RM65 million per year over the next 21 years,” it said.

Jentayu Sustainables is due to complete its acquistion of TH later this year, and the commencement of commercial operation of the hydropower plant was a prerequisite for the takeover.

The CEO of TH, Beroz Nikmal Mirdin, said the project is expected to provide a long-term sustainable revenue stream and profitability to Jentayu Sustainables.

“It will put us on a stronger financial footing as we continue to expand our footprint in the sustainable energy sector,” Beroz, who is also executive chairman of Jentayu Sustainables, said.