Fast Energy Holdings Secures First Solar Power Purchase Agreement

Petroleum trading and oil bunkering player Fast Energy Holdings Berhad is quickly tapping into the solar business with newly formed subsidiary Fast Solar Sdn Bhd. The latest news to come out from this is the Solar Power Purchase Agreement the company had signed with Volta Energy Sdn. Bhd, Apex Office Furniture Exporter Sdn. Bhd. and Apex Office Furniture Exporter Sdn. Bhd. to procure the construction of solar photovoltaic system and electricity supply for 25 years.

Under the agreement, Volta Energy will act as the engineering, procurement, construction and commissioning contractor, undertaking the design, construction, installation and operation of the solar PV system, which will be installed on the rooftop of Apex Group’s factory while Fast Solar will fund the construction and purchase the solar PV system from Volta Energy. Following that, Fast Solar will collect all amount payable by Apex Group for the purchase of electricity for an initial period of 25 years. Upon completion, Volta Energy will be responsible for operations and maintenance of the solar PV system.

This will be the first project undertaken by the oil and gas sector company as the company looks to include more renewable energy projects into its order book. These diversification are inline with global movement where more large oil players become more resonsible towards climate change.

The solar PV system is expected to generate approximately 39.2 million kWh of clean electricity during the 25-year contract period. The solar rooftop project is targeted to be completed by this year and will contribute positively to Fast Energy’s cash flow and financial performance in the future. Based on the fixed tariff rate of RM0.30 per kWh, the estimated contract value for the purchase of electricity by Apex Group amounts to RM11.7 million over the 25-year period.

Fast Solar will play the investor role and fund the construction cost of the solar PV system for RM2.86 million and thereon sell electricity to Apex Group. This project is anticipated to provide long-term earnings visibility and recurring income for the next 25 years. The group sees prospects ahead as it looks for opportunities to enlarge its portfolio of solar PV investments. Executive Director Tan Wye Chuan cites with this model, many businesses do not need to incur heavy upfront costs to enjoy the benefits of using solar energy. S

Separately , the potential proceeds of up to RM109.1 million from the Group’s proposed 2-for-1 rights issue with free warrants will give it the financial flexibility to capture future growth in the industry.

Apex Group is a company engaged in the manufacturing and marketing of office furniture based in Malaysia. It has been in the furniture industry for more than 20 years with 6 factories in Sungai Buloh and Kuang, Selangor.

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