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Good morning, everyone. Thank you for joining our third quarter FY 2025 analyst briefing. A very warm welcome to Yang Berbahagia Datuk Ir. Megat Jalaluddin Bin Megat Hassan, President and Chief Executive Officer of Tenaga Nasional Berhad, and Chief Financial Officer, Mr. Badrulhisyam Fauzi. I also extend a very warm welcome to each and every one of you joining us today in this hall. We also have 70 attendees joining virtually via Webex. Today's session will be covered in two parts. Our President and CEO, Datuk Megat, will first provide an overview of TNB's group strategy and outlook, followed by our Chief Financial Officer, Mr. Badrul, who will share TNB's third quarter FY 2025 performance. We will then open for Q&A before we end the session at 11:00 A.M. With that, I am pleased to invite Datuk Ir. Megat Jalaluddin Bin Megat Hassan to kick off our session.
Thank you.
[Foreign language] and a very good morning. [Foreign language] . First and foremost, thank you very much for being here, to be in the session where we share our third quarter performance, and I would like to welcome everyone to this new, I would say, development by Tenaga Nasional, which is the National Energy Centre, which is part of our UNITEN purpose, in which we would like to support the government agenda with respect to the energy transition. So this is where we hope that we can position Tenaga further with respect to the energy transition for the country as well as for the region, so I'm pleased to share some of our performance highlights for the first nine months of financial year 2025. The group delivered a strong financial performance underpinned by the continued stability of our regulated business.
We recorded a core profit adjusted for foreign transactions and MFRS adjustments of MYR 3.26 billion compared to MYR 2.87 billion in the corresponding nine months last year. This is a reflection of our underlying strength of our core business. What we have seen to date is stronger performance across all the four business pillars that we have. It's driven by all the improvements across those four business pillars. The first, under the delivered clean generation, Genco overall performance improved with higher core PAT of MYR 238.9 million compared to MYR 175.8 million in the previous year. This is supported by strong operational efficiencies as reflected by an improved Equivalent Availability Factor, or known as EAF, of 86.9%. As everybody can remember, Manjung 4 is fully operational since the beginning of the year.
Second, under the developing energy transition network fund, we deployed MYR 8.3 billion of regulated CapEx, comprising MYR 7.6 billion in base CapEx and additional MYR 0.7 billion in incentive CapEx. This intensified investment demonstrates steady progress in delivering our RP4 commitment, especially in grid investment, to ensure reliability of energy supply and to deliver those projects that relate to the demand growth for the country. So, under Dynamic Energy Solution, happy to share that we are making good progress with respect to the electrification of transport in the EV space, where we see to date, we have more than 5,000 EV charge points in the ecosystem, contributing to about MYR 5 million in revenue. Within this ecosystem, Tenaga Nasional, through our Electron brands, installed new 94 TNB charge points during the quarter, bringing the total to 160 TNB charge points in our EV network.
This is to reinforce our commitment to support the country's growing EV infrastructure. So this is where we see a good momentum and progress with respect to the electrification of transport, especially to the mass transport, in this case, the cars instead of the heavy vehicles. And lastly, under our driving regulatory evaluation, the transition from the ICPT to AFA mechanism effective 1st July 2025 marked a significant structural improvement. The AFA mechanism enables immediate cost recovery compared to the previous six months' lag in the previous ICPT regime. This helps improve TNB cash flow at least by 2% and definitely enhances our planning with respect to the working capital. So overall, this is also to reflect our resilience, operational discipline, and continued progress in advancing the energy transition while delivering sustainable value to all the stakeholders.
Moving on to our generation growth outlook, momentum remains strong, supported by the Government National Capacity Plan. Recently, we received a letter of notification for technical and commercial terms, covering a total capacity expansion of 1,262 MW across three power stations that are owned by Tenaga Nasional, namely Gelugor, Putrajaya, and Tuanku Jaafar. This, if everybody can recall, is part of the so-called RFP that has been put forward by the government under category one, where the government requests for proposals with respect to the extension of the power plant, so we are glad that we have gotten the results, and this extension strengthens system reliability and ensures that we remain well-positioned to support the Malaysian growing demand, as well as to ensure that the capacity and the revenue that is coming from this power station will continue to be part of TNB revenue in the future.
On the second category, the new generation capacity request for proposals, we are awaiting the regulatory decision, which focuses on the new generation capacity. And TNB, of course, participates in the RFP, and we hope that we can get the outcome of the results before the end of the year. So in short, these national capacity plans, both extension as well as the new generation capacity, provide a strong visibility and reinforce a favorable outlook for TNB's generation growth in the pipeline for the future. At the same time, let me update some of the progress that we are making with respect to the project that we are undertaking at the moment. On the domestic front, the project execution across our clean generation portfolio continues to progress well and firmly on track. The first one is the Nenggiri Hydropower Project.
We have now reached 53% completion, and we remain on track to meet the COD target by the second quarter of 2027. Happy to share that major civil works, including roller-compacted concrete, RCC placement for the saddle dam, are already underway. The second project that we are currently undertaking is the Sungai Perak Hydro- Life Extension Programme. It has achieved 23% overall progress. Data collection for all the units has been completed, and this is a Rehab Project. The project is on track to deliver the first unit at Chenderoh Power Station by the first quarter of 2026. At Kenyir, the plan for the Hybrid Hydro-Floating Solar project has reached 70% pre-development progress, and the commercial evaluation is currently in the final stage. This is another opportunity for Tenaga to provide clean generation to the customers directly through the CRESS program.
On the land solar projects that we are undertaking, under the Corporate Green Power Programme, or known as CGPP, all three sites continue to progress well with more than 85% completion and remain on track to achieve COD. The second project for the land solar is the awarded Large Scale Solar 5 tender. It is progressing towards achieving financial close by early 2026. At the same time, we are also taking a project in Sabah together with SESB, which is our majority-owned subsidiary, and we also expect to have a financial close by the end of this year, 2025, and lastly, the battery energy storage system at Lahad Datu, Sabah, in which our subsidiary TRe is undertaking together with SESB, has successfully achieved COD in August 2025, and it is in full operation just now.
It did help to provide the energy to the eastern part of Sabah. Overall, we have 1.2 GW currently under construction, reinforcing our clean generation growth platform that we currently have. On the international front, the third quarter update progress in the United Kingdom. We have achieved our international RE portfolio, recorded important milestones this quarter. In the United Kingdom, our greenfield solar project, both Eastfield 35 MWp and Bunkers Hill about 67 MWp , have achieved COD in July 2025, contributing a combined 102 MWp of new solar capacity to our portfolio and has started generating revenue for us. Over in Australia, momentum is equally encouraging. As part of the 1 GW Dinawan Energy Hub, the 357 MW Dinawan Wind Farm Stage One has successfully secured support under the Capacity Investment Scheme in Australia.
This provides a long-term revenue assurance for the project and enhances overall cash stability for the future. The second project that we are undertaking in Australia, it is named Wattle Creek Energy Hub , totaling 265 MW of solar capacity and 300 MW of battery storage. We have executed the connection process agreement with the Transgrid, which is the transmission operator in Australia. This allows us to move forward with detailed grid impact studies of the connection and the best possible discussion with respect to COD. In parallel, procurement for the standalone base is also ongoing. Meanwhile, for the Mallee Wind Farm project, 400 MW Mallee Wind Farm, we are progressing connection planning outside the designated RE zone and have secured the required land easement for the transmission connection, a key enabler for the next development phase.
As you can see, the Australian project, with respect to the regulatory requirement, one of the key elements is actually to get access to the connectivity to the grid. So many of our projects are now at that so-called pre-development stage, securing the grid access. And we believe that we are making good progress with respect to those in conjunction with cooperation with the local transmission operator. So with this addition, our group's secured RE energy capacity now stands at 13.4 GW, of which 4.6 GW is already in operation, while 1.2 GW is under construction, as summarized above, and 3.6 in the pipeline stage. This continued growth reinforces TNB's position as a meaningful regional RE player while providing a diversified income stream over the long term. Next, we move to investment into the grid.
Under our second strategic pillar, Develop Energy Transition Network, we are on track to deliver our regulatory targets, having successfully utilized MYR 8.3 billion of regulated transmission and distribution CapEx. So we invest MYR 3.8 billion to maintain security supply, MYR 3.8 billion to support demand growth, and MYR 0.7 billion CapEx for energy transition projects, enhancing the grid readiness for higher RE penetration and a greater data generation embedded to make it a smart grid. Progress of key projects. Firstly, the demand growth, especially data center connection. We have invested around one billion, while we are also developing the 500 kV overhead line between Ayer Tawar and Lenggeng project at approximately MYR 0.3 billion to strengthen the backbone of the national grid. Our 100 MW, 400 MWh battery energy storage system pilot project at Santong continues to progress well, reaching 56% of overall completion.
So we remain on track to achieve the targeted completion by December 2026. Meanwhile, at the distribution space for smart meters, we have overdelivered our financial year 2025 full year 360,000 unit target, with around more than 500,000 units installed at the end of the third quarter 2025, bringing the total 5.1 million units into the system, which is about 45% of our customers. This is also reflecting our strong momentum in empowering the customer energy management, including the new tariff offering of TOU. So this is one of the, I would say, the intended outcomes of the smart meter, providing the customer with the energy management system and supported by the tariff structure of TOU. For distribution, as you mentioned, which is important for our supply reliability, we have installed the system in 2,590 substations at the end of third quarter 2025.
As of October 2025, we have achieved 75% of our 2025 target of 4,026 substations. The projects under the CapEx, both for transmission and distribution, are well on track. While our domestic investments ensure the grid is ready for rising demand as well as RE penetration, the next dimension of our strategy is regional integration. Under the ASEAN Power Grid, we are actively developing integrations that will position Malaysia as a key hub for clean electricity exchange across the region. Currently, we have about 1.4 GW of existing integration capacity with Singapore and Thailand. We have five potential pipeline interconnection projects enabling the transmission of over 6 GW of combined RE energy, including hydro, solar, as well as wind with Vietnam, Singapore, Thailand, Sarawak, and Indonesia.
This project will serve as an enabler for the regional energy transition and position Malaysia as a central hub for cleaner energy flows. On the business plan, we believe this is the foray of Tenaga to have part of the so-called regional market in our revenue. And hopefully, we can expand the third pillar in combination of the domestic and international business. Now we have the opportunity to include the regional business as part of the mainstream of Tenaga revenue. Moving to our third strategic pillar, Dynamic Energy Solutions, we see that electricity demand has continued to grow. For the third quarter 2025, the total units sold reached more than 99,000 GWh , reflecting sustained demand momentum. This growth was largely underpinned by the commercial sector, which accounts for 70% of the total units sold.
For the commercial demand, we see that the growth year on year is about 7.7%, led by three subsectors, data centers, of course, contributing 5.2%, followed by the malls, business, and accommodation services at 2.2%, and the rest of the commercial sector adding another 0.3%. So we see a strong growth with respect to the commercial sector as well as our domestic sector. In terms of the sales contributions, mall, business, and accommodation services made up 80%. Other subsectors contribute 60%, while data centers account for 30% of the total units sold in 2025. So what does it mean is that, yeah, we can see that data center is growing, but in the overall scheme of the subsector, so-called unit, now it contributes about 3%.
We still have the majority of the commercial, from the mall and business and accommodation services, adding up to the education and also the communication sector, so we are happy that overall we have a good subsector growth, not only in data centers, but the other remaining business in the commercial sector. For data center itself, it continues to anchor the structural demand growth. As of the end of the third quarter, we have 29 projects in the system, which total maximum demand of 3.8 MW. Our secure pipeline now stands at 49 projects, representing 7.1 GW total maximum demand in the system, underscoring Malaysia's role as the digital investment hub. Alongside this robust demand growth, we are also seeing positive momentum across our customer-focused energy transition initiative.
Under the EV ecosystem, we continue to advance our EV charging rollout with 160 cumulative charge points installed, including 94 in the third quarter of 2025, so we remain on track to exceed our TNB-owned targets of 250 charge points installed by the year end of 2025, supporting the government EV roadmap, and of course, expanding the charging facilities nationwide. Year- to- date, our EV charging ecosystem has generated about MYR 5 million in revenue, of which MYR 1.7 million comes from our own TNB charge point. This reflects steady adoption of our charging solutions and validates the growing demand for EV infrastructure. For the EV charging development, we have introduced the Green Lane Pathway , and for this initiative, we have completed around 7 MW of connections with a target to achieve around 8 MW of connections within this year. Interest continues to grow strongly.
We currently have 448 applications in pre-consultation, representing 130 MW of potential new connections as we move forward. Moving on to the solar rooftop through GSPARX, uptake remains steady. Since inception in 2029, we have secured more than 3,000 projects, representing 538 MWp of secured capacity. As of September 2025, we have installed a total of almost 200 MWp , generating approximately MYR 80 million in revenue for the first nine months of this year. We are seeing a strong participation from key customer segments, such as manufacturing, government, as well as from the construction sector. On energy efficiency, myTNB App is currently adopted by 8 million of our customer base, which represents 80% of the current 10 million customers that we are having. Over 2.5 million users have now subscribed to myTNB Energy Budget feature, helping save 100 GWh of energy.
And at the same time, if we calculate in terms of the carbon emission, we have avoided more than 75,000 tons of carbon emission as of September 2025. Additionally, as mentioned, the uptake for the Time of Use scheme has been very encouraging, with about 52,000 customers now optimizing their consumption pattern to better manage the electricity costs. This initiative reflects our progress in driving customer participation in the energy transition term and unlocking growth from the prosumer segment of our customers. So that is the overall four pillars performance as of the third quarter. Now I will pass to our CFO, Encik Badrul, to provide detailed updates on the third quarter financial performance. Please.
Thank you, Datuk, and good morning, everyone. Good to see all of you here in UNITEN today.
And since the results last Friday, seems like you guys have been doing a lot of work over the weekend. So good to see you here. So I'm pleased to report that for our nine months' performance, you've seen that we have a stronger financial performance, which mainly is still driven by regulated business. And obviously, you will see as well a result of more effective capital management. So for the first nine months of 2025, revenue, EBITDA, and PAT across the board have showed positive year on year growth. So as of nine months 2025, our revenue actually increased by 18.3% compared to previous year. And you'll notice that this is mainly driven by higher electricity sales. It's important to note that implementation of cost-reflective RP4 approved tariffs continues to support revenue, as well as affirming that it will continue to support the stability of our regulated business.
On the EBITDA side, you'll see improvement as well, supported by higher revenue, recording an increase of 4.8% year on year, increasing to MYR 15,088.2 million. EBITDA margin as well, you'll notice that it strengthened to 31.2%, showing improved efficiency across the group. So I think this is important to note that as we monitor the EBITDA margin, this shows continued progress of the company, where a lot of cost management has been put in place to ensure our stable operation continues to deliver the regulated profit. So at PAT level, you will notice that our profit grew mainly because of the improvement in the operational performance of the company. So you'll notice that we are now focusing on core profit after adjusting for FOREX translation and MYR 0.516, which is a much better reflection of the performance of the company.
That figure now is at MYR 3.259 billion, which is an increase of 13.7% year on year compared to the same period last year of MYR 2.8674 billion. I think based on that number, we would like to conclude that as far as the overall performance is concerned, lower net finance costs as well as FOREX movement actually provided an additional uplift to the performance of the company. Most importantly, core operations remain the main driver of the performance of the company. For FY 2025, we believe that the group remains on track, supported by resilient operations as well as prudent financial management. This will make sure that we continue a sustainable performance for the full year this year.
You will notice as well that as far as the group earnings are concerned, we have actually supported by two important pillars that continue to support our operation, importantly improved generation performance as well as sustained world-class network performance, so this is important. As you notice that the network reliability across transmission and distribution continues to deliver our earnings, so as far as generation is concerned, the higher equivalent availability factor of 86.9% in nine months this year is much higher compared to 80% that we achieved the same period last year. So the improvement actually reflects stronger overall plant performance and the fact that our maintenance and repair and all are delivering the expected performance from the plant.
So this is something that a lot of focus is being put across, and we continue to maintain this high availability as well as operational excellence across our plant for this year and many more years to come. For system minutes for transmission, nine months this year is actually at 0.0695 minutes, which is, as reported, quarter in and out every quarter, well below our internal threshold of 1.5 minutes. This is important because, as you notice, a core part of our revenue and profit comes from this, and this continues to underscore our commitment to make sure that our regulated business continues to perform and deliver the baseline revenue and profit. This will only make sure that we have highly reliable and stable earnings as a result of a stable transmission network.
So for SAIDI distribution minutes, you notice that the numbers for this year improved to 34.99 minutes compared to 35.72 minutes in nine months 2024. So I think this is, again, every quarter, we would like to emphasize this because this is an assurance to all of you that the stability of our regulated business ensures that we've got better services to our consumers and continue to deliver the earnings of the group. So if we move to a bit more financial metrics that we are collecting, you'll notice that we have a stable collection trend, and regulatory certainty continues to underpin our very resilient cash flow. So if you look at our trade receivables and collection, trade receivables remain stable. It has been around MYR 4.4 billion-MYR 4.7 billion year- to- date and continues to be stable.
This is actually also a reflection of a stable collection trend with an average collection period which continues to be below 70 days. So this has been at around 27-28 days, so very healthy numbers despite the jump in the revenue, which has grown significantly by 18%. So you will notice as well, as far as the AFA mechanism, which has gone into effect as of 1st July 2025, this actually enables us to recover immediately all our generation costs because it is based on forward-looking forecasts every month. So this has also helped us in the sense that coal price has now stabilized at around $90 per ton this year compared to a much higher $121 per ton as of September last year.
So we believe that the fact that fuel prices are stabilizing, we have a strong collection trend, and it is being helped further by the newly implemented AFA mechanism, which will only continue to strengthen our working capital as well as provide us a much healthier cash flow position. So in short, I think this is what you're going to see. We have put a lot more focus on our capital management, which is actually giving us the right result on the pretext of stabilizing fuel prices, strong collection, and this will continue to make sure that we have the liquidity and the strength to make sure that we have the financial resilience for us to continue investing.
So this trend that you're seeing today actually will show that we have a strong foundation enabling us to weather the market conditions and, most importantly, enable us to continue our long-term investment plan to make sure that we deliver the energy transition agenda. So if we go into more detail as far as the outcome during the quarter, you will have heard that we've got two reports that came out from both S&P and Moody's. So both international rating agencies actually have reaffirmed their ratings of the company with a stable outlook. This is something that is very important, like I said, because you have noticed that we have been investing a lot this year, and we will continue to invest in 2026 and 2027 as well. So S&P Global Ratings maintained their rating of A minus, and Moody's continued their rating of A3.
But I think most importantly, probably this one, some of us, since most of you are equity analysts, you probably don't dive into the detail as far as the credit rating is concerned. But I think we would like to highlight that for S&P Global Ratings, as a matter of fact, yes, we continue to be rated A minus, but they have a component where they have a standalone credit rating profile of Tenaga as well. So that rating before this was Triple B, so now that has been upgraded to Triple B Plus . So before this, it was standalone Triple B, but we've got two-notch rating upgrades to A minus to reflect the sovereign rating. But now, on our own, we have already been upgraded to Triple B Plus. So we are only upgraded one-notch, reflecting the sovereign nature of the country.
So this is an affirmation that, as far as S&P Global Ratings is concerned, they believe that our cash flow is going to be a lot more resilient going forward, supported by two things. The first one is the AFA mechanism because this will actually stabilize our cash flow and receivables with immediate recovery of generation costs. And they have been tracking our performance in terms of the lease liability, especially the PPAs. And now they are confident that the overall regulations for Malaysia for PPA enable us to recover all the costs under the Power Purchase Agreement with the IPPs. So with those two adjustments to the cash flow forecast of the company, they believe that the cash flow strength of the company will only be better going forward. Moody's Ratings, they continue to reaffirm the A3 rating.
Obviously, the normal assessment covers the fact that we have a very supportive regulatory regime and tariff reform that has been implemented by government that enhances the revenue visibility and cash flow efficiency. So obviously, when we talk about the credit rating, usually we'll take it as a blended, more indicative ratio of gearing ratios. But I think it's important to note that as far as both Moody's and S&P are concerned, they are actually monitoring a different cash flow profile. So just to give you some perspective, S&P in particular, they monitor funds from operations as a level of debt, and Moody's, they monitor retained cash flow as a percentage of debt.
So yes, I know a lot of you guys are monitoring our overall gearing ratio in particular, but for credit rating purposes, they actually dive into more detail to make sure that the cash flows are supported by operating cash flow coming forward, especially in an environment where you continue to invest. So I think what we are putting across today is the fact that we believe that, in summary, this recent upgrade and reaffirmation continue to underscore the strength of our credit profile as well as our long-term financial outlook. So we always would like to point out that as far as S&P in particular, this reflects increasing confidence in the robustness of our fundamentals as well as the fact that we have a stronger cash flow stability and visibility with minimal risk.
Altogether, this development reinforces our financial resilience and validates our disciplined approach to financial planning in managing our balance sheet so that we continue to enable our long-term business plan. So I think we are very clear as far as we are concerned. Yes, we are pushing for growth, and we will continue to support the nation's energy transition and create continuous value for our stakeholders. With that, I'll pass back to Datuk Megat to cover on the outlook for the year.
Thank you very much, CFO, on the financial performance update. So looking forward, the forward guidance, especially for the next quarter, we anticipate the electricity growth to grow in line with the IBR position of 2.8% for the year. This reflects the overall growing economy, particularly from the commercial sector.
In terms of our group CapEx, which we probably have more say in it compared to the so-called demand, we plan to invest a total of around MYR 15 billion this year, with the estimated or projected MYR 12 billion allocated to the regulated business and another MYR 3 billion on the non-regulated business. So our investment remains in line with the national priorities, centering the grid, supporting demand growth, encouraging Malaysia's energy transition, as well as to ensure that the capacity of generation is good for the country. By year-end, we expect to strengthen our RE portfolio with an additional 212 MWp capacity, taking into account the commissioning of our 102 MWp U.K. solar assets and the upcoming COD of our CGPP projects of 110 MWp.
On the capital management, as mentioned, we remain fully committed to executing our CapEx efficiently while maintaining a healthy cash position supported by a prudent working capital management. To our shareholders, we reaffirm our commitment to honor our dividend policy and strive to provide sustainable dividends in the future. Ultimately, our focus is on ensuring long-term sustainable growth as we advance Malaysia's energy transition agenda under NETR, and this is reflected through our future investments that we are committed to deliver. So we will continue to position TNB as a leading provider of sustainable and reliable energy solutions, creating value for our customers, communities, shareholders, as well as the nation. So with that, thank you very much for listening.
Thank you, Datuk Megat and Mr. Badrul, for your presentations.
I would like to inform that we have 90 people joining us on Webex, and let us now transition to the Q&A session. We will begin by taking questions from the attendees here in the room, followed by those joining us on Webex. With that, I open the floor for questions. Please feel free to raise your hand, and our staff will pass the microphone to you, and you may proceed to ask your questions. Kindly introduce yourself and share your questions. Thank you.
Thank you very much. I have three questions. My first question—this is Jeremy from CGS. My first question is clearly on the taxes. There was the announcement in the Bursa saying that you have been allowed investment allowances.
Can we get a bit more clarity as to how much of the MYR 10.5 billion can be clawed back, over how many years, and how does that impact your effective tax rate moving forward? The second question is, can we get an update on contingent CapEx? We are now one year into RP4. What's visibility like? Are we still looking at 70% utilization for RP4? And has there been any resolution on the remuneration mechanism for contingent CapEx? And just a final question on data centers. I think the Deputy Minister highlighted there are some concerns on take-up. How should we, as analysts as well as investors, be reading this? Should we be concerned, firstly, from a Tenaga perspective, and secondly, generally, in terms of data center demand in Malaysia? Thanks.
Thank you very much for the three loaded questions to begin with.
So on the tax allowance, as everyone understands, this is a tax matter that has been in the system for many years. That is a question of the reinvestment allowance. And so from a Tenaga perspective, we are glad that the Federal Court has made a decision with respect to the clarity on the reinvestment allowance bucket. And as guided by the Federal Court decision, we have submitted the so-called reinvestment allowance claims under 7B. So recently, we have received the so-called decision on the reinvestment allowance. So at this very moment, we are still looking at the so-called calculations of the so-called reinvestment allowable allowance, and definitely we'll provide the feedback as soon as we get better clarity in terms of the details of the allowable reinvestment allowance. So on one aspect, we are happy that the company can move forward with respect to our performance.
As reflected today, the third-quarter performance or the current performance of Tenaga is basically not affected by the situation that we have on the reinvestment allowance. Anything you want to add?
I think Datuk covered everything already. Should be okay. It's a delicate subject.
The contingent CapEx 70% resolution is still on track. If you look at the three-year period, definitely we are looking at a high percent of the so-called contingent CapEx. If you look at the scheme of things with respect to the base and contingent CapEx, it is only expected that Tenaga will use the so-called base CapEx first comparatively to the contingent CapEx.
Even notwithstanding that, we are going to—we already utilized the contingent CapEx in the first months of this year because, again, the way the contingent CapEx is structured is based on the triggering of CapEx required for a certain category of demand. So if you ask me today, yeah, I think we are very much confident that we can utilize the CapEx. And one of the CapEx that has been being tasked for us to utilize is actually the contingent CapEx with respect to the smart meter installations. That's where you can see from the report just now, we have achieved more than we are targeted. But then again, that is probably for the year. But then again, that is not the actual target because the actual target now has moved from 360,000 to complete the whole smart meter installation by this period.
So looking at that, definitely the smart meter triggering has happened, and we have started to utilize it even though in the first year of the utilization. And if you look from the his tory of Tenaga , we have always in the last RP able to complete and deliver those CapEx, and we intend to do the same for this CapEx allocation that we have for this year as well as the next two years. On the third question, data center underutilized demand should be a concern. From a Tenaga Nasional perspective, we are actually aware from day one that data center demand is going to be a step demand, meaning that every month there would be a demand increase. So it is not linear or something that you can expect from the other form of demand growth.
From Tenaga, we feel that looking at the demand growth, it is very much a step approach on a monthly basis, and our retail team is monitoring that. That's where, in terms of the generation capacity, I think there are a lot of questions in the past about can the generation capacity cater for it. I think that question arises because when you look at the demand projected or being asked by the data center, they always put the end demand in mind so that we can prepare in terms of the planning. For example, they will ask in their supply applications that we want a 100 MW data center. But within those so-called projections, we actually discuss and have a good, I would say, view with respect to the demand growth within that 100 MW, which is a step demand.
So that's why we are, in terms of the generation capacity, yeah, we mentioned now there's 7.1 GW of capacity request, so if you add mathematically our generation and the demand that we have, it may be a concern to many, many people, but if you look at the growth, the 7.1 is required by a certain year. It is not today, so that's why Tenaga is confident that we can meet the demand. That's why we actually process the demand, and that's our advice to the government as well, so looking at that growth, I think we are seeing a steady growth of data center, which is part of their planning because the way data centers operate as well, that they actually operate on a modular basis, meaning that they can install the so-called CPU or GPU in a modular form based on their so-called client requirement.
So if you ask me, we are positive about this. Looking at the phased Month-over-Month growth, it is there. And it also provides us, Tenaga Nasional, as an infrastructure company, the time to build this so-called generation asset as well as our transmission and distribution asset. So we cannot ask for more from the perspective of utility. A good demand with respect to the so-called scale. And the scale is not too demanding on our infrastructure because we are given the time to actually plan and deliver it. So I think that is my summary with respect to data centers.
And in the past, I think we have so-called invited the analysts to visit some of the data centers, and we are also willing to do that if you feel that it's necessary to get the assurance from the data centers players themselves because we are having good communication with them, and we know what they are up to in that sense. And they are also always giving us the so-called heads-up with respect to what they require in the coming months. Thank you.
Thank you, Datuk. So I open the floor for the next question.
Good morning, Datuk Megat and Encik Badrul. Thank you so much for this analyst briefing. A couple of questions from me. Firstly, congrats on the extension of three power plants under the EC's RFP. Can you help us understand in terms of the implications for Genco's earnings from this extension?
Would it help Genco's earnings to grow, or would it only just help Genco's earnings to sustain at current levels? That's the question on the extension. And also, with regards to the new generation capacity, can you help us understand whether there's a limit on the number of new plants that a bidder can win in this RFP? So that's question number one. Second question is with regards to your bad debt provision. So I think in this quarter, there was a receivable that was reclassified into a bad debt around MYR 260 million. Can you give us a bit more color as to whether this is truly a bad debt, or is it just a case of the receivable having aged and you having to provide for it, and collections are still underway? And is there more potentially to come from this debtor or this receivable?
Yeah, those are my two questions. Thank you. Sorry, I'm Fong from CIMB. Yeah.
Okay, thank you very much for the questions. Three questions. I think the good one, the bad one will I leave to the... because it's a bad debt, so I'll leave it. Anything bad, I think I will give to the CFO. So the first one is actually implication for Genco with respect to the extension. As you can see, the PPAs of the power plants, normally there is a two-tier pricing mechanism. There is a period where we earn based on the first-tier tariff, and then the second- tier, normally there is a second tariff. So with the extension, basically, that will have a reset, meaning that we will move to the... we will move back to the so-called first- tier.
So it provides us both the sustainability as well as the potential upside with respect to the revenue for Genco. So that's why we are quite excited. Of course, it is dependent on our performance, but there's a potential for us to go for the upside because it becomes a reset with respect to the extension. I think the second question, new generation capacity, is there any limit for the bidder can win? I think in the RFP document, I think it is a public document, there is a MW, a range of MW specified for the new generation capacity. If I remember correctly, it is about 5,400 to 5,000 MW. So that is the capacity the country is looking at. So that's where the bids come about. So I don't think there is any limit for the bidder, but the limit is more...
If you can say that's a limit, I don't think it's a limit. It is what the industry requires. It's about 5,000 MW. So for Tenaga Nasional, as an incumbent, we feel that we have a good chance. Thank you.
On the second question, it's not bad, actually. Actually, this is, I think it's really our more proactive approach to make sure that we comply with the provision in terms of what has to be impaired and all. But in this particular one, you are right, actually, it's more of accounting treatment, and this is actually an effort in the way that reflects the true nature, and no, we're not giving up. The collection is actually being underway, so it's just trying to make sure that we follow the accounting standard.
But obviously, we are working with specific debtors to make sure that we continue to recover what is due to us. That's where you can see that to us, yes, these are specific instances. But more importantly, that's why you look at the collections receivable as well as the ICPT that continue to be in there. So that's why the collections continue to be strong for us.
Just to add, I think there is the prudent practice that TNB has been doing in the past as well. While we continue to collect, and there are various means, including the last result is, of course, collection through legal. But before that, there are two other steps that we are taking to ensure that we get the so-called collection that is due to us. So anything that we collect now becomes an upside. That's how I see it.
So it is probably a good debt provision rather than a bad debt provision. I'm not in court, so I can change anything.
Thank you, Mr. Badrul and Datuk. Maybe we can have another question from the floor.
Hi, good morning. This is Isaac from Affin Hwang . This is a follow-up question, actually, on Fong's questions. When it comes to the RFP category one, can we just have some more clarity on when have you started and how long it's the extension, whether it's optional plus one plus one, or how does it work? And number two is that when it comes to the category two, is your Paka Repowering Power Project and maybe the Pulau Indah, maybe the Kapar power plant, and have you secured all the gas turbines and whatnot? Thank you.
Yeah, so on the so-called RFP category one, there are the extension for the three power plants.
There are various dates with respect to the start of the extension. What is important is that the extensions will come with the work that for us to ensure the continuity and reliability of the system. We will have to do the so-called rehab of the plant, meaning that we will do a good check with respect to the performance, the current performance, because it is already basically ending of the PPA. So we are going to start doing those, planning to do those what are required with respect to ensure that the power plant will continue for the next five years of the extension. But the COD will start around 2028-2029, and it is different from each power plant. And in the meantime, the power plant will operate based on the current PPAs. On the second, the repowering and Kapar secured gas turbine, current status.
For Paka, yes, we have had a conversation with the manufacturers, and in particular, one manufacturer. We believe we have secured the gas turbine for the project.
Thank you, Datuk. Maybe we can have another question from the floor before we move to the Webex. Is there any question from the floor? All right. So now we will proceed to take questions from the analysts who are joining us virtually. For those on Webex, if you have any questions, kindly type your name and the company you represent in the chat box. So we have the first question from Iwani Farzana from PNB. Hi, Iwani. We have unmuted you. Kindly proceed with your questions. I think we will proceed first to Rachel Tan from UBS. We have unmuted you. Can you hear us?
Can you hear me?
Yes, we can hear you.
Okay, thank you. So I have two questions. So the first is on the news flow that you've lost in excess of MYR 5 billion from electricity theft. How does this impact earnings, and is this accounted for under the regulated business model? Second question is that your gearing ratio looks a bit low for a regulated business. Since RP4 documents are not out yet, could I check what the target gearing ratio is for the regulated business, and does this affect your returns, or will you just get 7.3% regardless of the gearing level?
Okay, thank you very much, Rachel, on the first question with respect to the so-called loss on the electricity theft. I think we have the figures being quoted for a number of years.
So, with respect to the so-called TNB perspective, of course, we have formed a task force with respect to the theft of electricity, especially handling the Bitcoin segment that has caused the losses to be much bigger than comparatively. So, the task force is working together with the regulator, Energy Commission, and also the ministry, how best we combat this so-called theft of electricity that is happening currently. And those figures that you have seen are actually part and parcel of the task force work, the figures that we have identified, and some of those figures, we actually have recovered the losses. So, there are two perspectives, yeah, figures identified, and the other one is actually that is part of the task force work that we have recovered some of those thefts of electricity.
With respect to the whole industry perspective, as far as the regulated business, this is actually an industry loss because at the end of the day, the losses are calculated as part of the tariff calculation. So it is actually, if I may use the word, it's actually being socialized to the whole industry. This is where we want to also encourage the customers, the one that is not basically involved in this is actually affected because it is, from the industry point of view, it is being socialized. So in that sense, TNB will continue to be aggressive with respect to theft of electricity. But at the same time, we want also the public to help us actually report all these cases because the industry is actually at a loss rather than the TNB from the perspective of the company itself. So that is theft of electricity.
The second question, I leave it to CFO.
Thanks, Rachel. I'm pleased when people say they think our gearing is relatively low because that's the way we should think about it. Because today, as for our gearing level, that's around 52.4%. And you were making references to the regulated industry's guideline. So under the RIG for our regulated business, the overall framework actually allows for a 55% gearing ratio. So we believe that there is still some room for us to actually push the gearing ratio to make optimum use of our capital allocations. And like I said, yes, for regulated business, that's important. But of course, we are very aware that we've got to safeguard our credit rating profiles as well, which, as mentioned earlier, does not tie to specific gearing ratio, but rather the cash flow position of the company as a percentage of that numbers.
So we are focusing on this, and you will see, hopefully, we'll be able to optimize our capital allocation as well as gearing level for both regulated and unregulated so that we can optimize the return to the shareholders. Thank you.
Thank you, Datuk and Mr. Badrul. So we have another question from Eliza Tay from Fidelity. So we have three questions here. The first question: For new gas generation capacity to be announced in 2025, when will potential plants start up? And the second question is: What was the power demand in MW from data center in 3Q 2025?
Thank you, Eliza Tay, on the questions. The first one, for the new gas generation capacity to be announced end of 2025, when will potential plants start up?
So based on the request for proposal, there is a timeline given or date given for the COD. So it is going to be end by 2028. So as far as the industry and the regulator is concerned, this is where the expectation of the new generation capacity to be taking place, which is about four years from now. So this is also in line with the so-called required construction time of a new power plant between 36-42 months. So that is the dates as far as the new generation capacity is concerned. With respect to the power demand of data center, yeah, we give some numbers with respect to the demand to show that there is a growth. So in June 2025, it was 603 MW. In September, end of the quarter, 701 MW. And I believe in October, it is already 850 MW.
So that is the growth that we are seeing. So it is on a monthly basis. And I think probably the industry thinks this is a small number. This is not 100 MW. It's a big number. Our generation capacity, for example, one of the hydropower capacity, Chenderoh, for example, is 50 MW. So it's a big number. It is not kilowatt. It's megawatt. It's big in numbers. And I think probably, and if you ask me, I've been in the industry for many, many years. And we only see this kind of growth in the early 1990s, where we do have the so-called FDI that is coming in with respect to the manufacturing industry from the overseas market, making Malaysia as the best investment hub. And this is actually big. It is not kilowatt. We are seeing a growth of 100 MW a month.
I think probably that is where electrical engineers like me appreciate it. But I think it is a big number with respect to the infrastructure that is required. And of course, it is a big number with respect to the sales that we are projecting. Thank you.
Thank you, Datuk. We have another question from Sumedh Samant from JP Morgan. Hi, Sumedh. Can you hear us?
Three questions so far. Just a housekeeping. I saw in the earnings there was a gain on financial instruments, some MYR 233 million or something. Could you please explain to us what that was, and is that a recurring feature or non-recurring? My second question is actually on the financial notes. There was a mention that Tenaga received a letter on 26 November about approval of investment allowances. Can I check if it is for the future or if it is for the past?
And perhaps the third question, again, going back to the whole provision, MYR 10.6 billion, can we check what will be the steps that Tenaga will be taking going forward to potentially reverse these, or do we think that this is all that we have to pay to the IRB anyway, and there won't be any recoupment? Thank you so much.
Maybe Datuk, I'll take the question on the provision.
Yep.
So I think you all are aware that previously, obviously, we claimed the reinvestment allowance under 7A. And after the Federal Court decision, we reviewed our position, and we submitted a claim under 7B investment allowance. So we disclosed in our announcement that we received a letter from MOF on 26 November that was for investment allowance. So it is for Schedule 7B, and of course, it's for future income.
But the investment allowance is actually from the perspective of the CapEx previously spent, originally claimed. So that's on the approval. But I think most importantly as well, as far as the amount of MYR 10.6 billion previously disclosed in our quarterly result, as far as the litigations are concerned, you would notice that in the recent announcement, we have also made a statement that we have withdrawn and concluded all the legal arrangements with the tax authorities for that matter. So all cases have been closed. So for accounting purposes, we actually disclosed as well in our PYA Note 29 that as far as the position of the company is concerned, we have actually taken a PYA adjustment to the balance sheet to retrospectively reflect the actual situation. So the tax cases were actually for prior years leading up to 2024.
So it has been reflected as such in the prior year's adjustment to reflect the actual situation. As far as the approval letter, obviously, I think it's still fresh off the oven, and we are actually still assessing the actual impact of the approval together with our auditors. We should be able, hopefully, to share with you direct implications to our effective tax rate going forward, hopefully. But obviously, we are already in Q3 in December already for 2025. So I think as far as the guidance is concerned for 2025, we probably continue to guide it at the current level. You'll see that nine months, we are at around 29%. Hopefully, however, obviously, going forward, we should be able to have a better, lower effective tax rate. So bear with us.
It's coming through, but we have to take this properly step by step to make sure that we get the correct treatment.
Thank you, Mr. Badrul. So we will be moving on to the Iwani Farzana from PNB. So the first question will be, can we check for Category 2 National Energy Awards ? The announcement by year-end, will it be only for partial award to certain players or lump sum? And for the second question will be under tax. For ITA, how much exactly was approved? Total amount of 50% as guided to foreign investors. And does this approval also guarantee future ITA claim under 7A will be approved? If yes, will the guidance of approximately 30% tax be revised downwards? Additionally, for the approved ITA 2003 until 2024, since it can be deducted from future taxable income, what will the strategy allow?
Lump sum or if gradually, can you share over the span of how many quarters or years allowed? And the last question will be, any update if the contingent CapEx earnings can be recognized in RP4? Or will it be the same case as to what happened in RP3, which means it can only be recognized on P&L in RP5?
Thank you very much, Iwani. I think the question on number one, whether the project award will be to certain players or lump sum, I think that is definitely beyond Tenaga Nasional. It is the decision by the Energy Commission. So I will not want to comment or speculate on those. Thank you. And for the second question, maybe CFO wants on .
Thank you, Iwani. I think this is just further on to deliberate from what I've mentioned just now.
I think we can inform you that it's not the full amount, but it's a fair amount, and I wanted to be clear that I think Iwani has in her questions that 50% guided to foreign investors. That did not come from us. We did not guide anything, any amount of the approval to anyone. You will understand that all we can say is it's a fair amount, and that's all we can disclose at the moment, and I think what's important is, like I said, we are still assessing the impact, so I will not be able to tell you how long and all, so please bear with us just this time, and I mean, to put this into perspective, like Datuk Megat said, this has been there for the last 20 years. We are finally resolving it.
So just give us a bit more time to actually do it properly this time around. So I think that's really all that we can actually inform you at this point of time.
Yep.
So, and as mentioned earlier, this is already December. Tax rate for this year will be, hopefully, we'll be able to manage it a little bit. But in the long term, yes, we do expect the tax rate to go down progressively. But as all of you also would understand that there are, for big corporates like Tenaga, obviously, there are also non-deductible expenses on our balance sheet, including interest restrictions, as well as changes in fair value and accretion of interest under MFRS 139. So to get to 24% simply like that will take a bit more work for us to get to there.
But I think we can guide that, yes, it will improve over time as we finalize the impact of the approval by MOF. And last question on RP4 contingent CapEx, Datuk?
Yeah, on the last question on the RP4 contingent CapEx, definitely we want the contingent CapEx to be recognized and RP4 because it is a clear definition that there is a contingent CapEx. Base and contingent CapEx is clearly defined under RP4. And I think Iwani made reference to RP3. I think during RP3 period, I would like to say that the contingent CapEx come after, meaning that in the beginning of RP3, there is no definition of contingent CapEx. So that's why the CapEx, after discussion with ST, comes about in the next RP.
And I think that's the reason why when we negotiate RP4, we make sure that there is a structured way with respect to addressing the contingent CapEx. And I think we have gotten that structured way by defining both the base CapEx and the contingent CapEx with the so-called projects on BESS as well as the amount on both base and contingent CapEx. So in that sense, we want to basically make a better definition on the recovery of the CapEx. And we hope to do so in RP4. Thank you.
Thank you, Datuk and Mr. Badrul. So we have another question coming from Daniel from Hong Leong. Hi Daniel, can you hear us? Hi Daniel. I think we have unmuted.
All right. Good morning. Okay. I think my first question has already been answered.
Just want to check if Tenaga already adjusted all the accounts prior years for these tax issues. Does it mean that Tenaga has to pay in advance the MYR 10.5 billion first before able to claim the tax future, I mean the ITA in the future for offset the future income? So first question. Second question, for the capacity of Tenaga's generation is about 13 GW size generation capacity. So based on the reported earnings of Genco, about MYR 260 million, is it considered a normalized earnings? That means your full years could be roughly just a normalized MYR 400 million for this 13 GW size capacity. Third question, I noticed that you guided on the RE for Tenaga, you have another seven over gigawatts spent out. Can I get a breakdown of this seven over gigawatts of RE? That's all from me. Thank you.
Will CFO take the number one?
Yep.
Then I think, as mentioned earlier, I think let's be clear that for the last 20 years, we have claimed under 7A for reinvestment allowance for CapEx previously spent. So when the Federal Court ruled for us to claim under 7B, we make the application under 7B for the same CapEx that was spent for the last 20 years. So we talk about the approval just now, yes. So that's why as far as actually the actual tax liabilities are concerned, we can confirm that as far as payment is concerned, yes. As part of the overall application for 7B application, we actually paid all the tax amount that has been assessed to us. So that's why now we've got the approval for investment approval for future income. Obviously, if we're talking about the cash flow, yes, we have paid it.
And that's why we have actually closed all the legal proceedings with the tax authority. So then obviously, naturally, again, what was the impact going forward? That one we are still assessing, like I said. But I think it's important to recognize that the overhang in terms of what can happen to us in terms of exposures, in terms of whether it has been settled, that is finally we put a closure to it. So meaning there is no more exposure in terms of provision or hit to our P&L as far as the exposure is concerned. So exposures are closed and it reflects the retrospective adjustments to our balance sheet to reflect actually the fact that our retained earnings was built up much higher than it was supposed to for the last 20 years.
So that's why retrospectively we adjusted to retained earnings to reflect actually over the last 20 years that would have been the actual retained earnings during the years. That is also in line with the fact that we made the payment for all the tax exposures. So that was the closure to it.
Thank you, CFO. So for the tax item, I think what Tenaga has done is actually to comply with the regulation with respect to the payment. I think everybody is aware of the regulation with respect to tax and the payment of tax for the country. And we are actually in compliance with that. On the second question, the Genco earnings projection, I think the figure that we have shown is the end of third quarter figure of MYR 260 million. We hope that, of course, the figure can change towards the end of the year.
We hope it's going to be a better figure. The third quarter, sorry, the third question, RE capacity breakdown of 7.6 GW in the pipeline. So we have a number of pipeline gigawatts in our stable. First is the domestic front. As mentioned, part of the pipeline is the hydro floating solar. We have yet to start construction, but it is in our pipeline. So we are talking about 2,000-2,500 MW. We have also pipeline with respect to our investment in the U.K.. There are a number of potential bid or even securing the land and also the capacity in the U.K.. And we have also the pipeline capacity in Australia. As everyone remember, our investment in Australia, we buy a company that has a right to build RE generation over there.
A combination of Malaysia, Australia, as well as the U.K. provide those so-called RE pipeline of 7.5-7.6 GW for Tenaga Nasional. So meaning that this is part of the foundation for us taking into account the objective of Tenaga in terms of meeting the ESG commitment that we have for the company as well as for the country.
Thank you, Datuk and Mr. Badrul. And we have a question from Zi Xun from Apex. Hi Zi Xun. Can you hear us? Hi Zi Xun. I think we have unmuted you.
From Apex Securities. Yeah, so actually only two questions from me. So I'm going to bore you again with tax question.
So regarding the investment IA claims, right, since we don't know how much is the amount now, but let's say if, I mean, the amount not approved, right, by Ministry of Finance, will it be straight away booked as a tax expense in fourth quarter or how does it work? So that's the first question. And second question is regarding the operating expense, right? So just want to know if for the fourth quarter, whether the operating expense will be more or less stable from third quarter because I think there were precedents where the fourth quarter expense went up a lot. Could be, I think it was due to the insurance costs and maybe a bit of repair maintenance costs. Yeah, that's all for me.
I guess I'll take this one, Datuk. Yep. I think yes.
That's why I think it's important to understand that as far as the taxes are concerned now, the 7A and 7B, we actually took the position and this is agreed with our auditor that we have to treat the two things separately. So it's important to note that as far as the previous exposures are concerned, irrespective of whether the approval comes or not, those are already put to closure in terms of the right accounting treatment for it. In which case was that we have incorrectly filed our tax return for the last 20 years. So we have corrected that one through prior year adjustment of MYR 10.6 billion to our retained earnings. So that is to making sure that as far as exposures and liabilities arising from the previous treatment is already put to closure.
And this is consistent with the fact that we have already paid the tax assessment as well. So meaning it's settled in terms of that. There is no more future exposures or anything. So it's done for that part. So the approval letter that we got from MOF is actually, yes, in respect of the CapEx that we have spent in the past, but it's being approved for us to utilize it as investment allowance. So going forward, when we have our income, we would be able to utilize this allowance to actually improve our effective tax rate going forward. So there is no question about the amount is not approved or anything like this because it is already approved for previous CapEx that we have spent under the form of investment allowance.
So now going forward, it will be this is what we are assessing in terms of how do we treat the recognition of the investment allowance that was approved by MOF against our future income, so basically to put it simply, downside has all been settled. Now it's only upside that we are still assessing the impact for Tenaga. So for the second question on OpEx, most of you have covered Tenaga very long time, so you would know that usually, yes, there is a slight uptick in our quarter for OpEx. Lilian was already nodding her head, so because she has seen that so many times over the many years.
So, but of course, I think we want to make sure that seasonality is adjusted over time, but at the same time, we want it to reflect the actual operation as well as nature of the expenditure on the ground. But by nature, however, the fact that all of us humans operate on yearly cycles. Obviously, quarter four, we want to make sure that everything is the I's are dotted and the T's are crossed across all our expenditure. Naturally, you should expect slightly higher, but nothing unusual. It's just the normal cycle of the reporting of the company.
Yeah, on the question number two, sometimes we also probably have to look from the other lens saying that normally in the quarter four, many things get done because this is where the so-called KPIs for the company.
Yeah, so you're actually going to see both the delivery become heightened in quarter four. And of course, we may require OpEx to be part of the delivery. And it should be also worked in tandem. I think that's what we are trying to do, yes. There could be an increase in the so-called operating expenses, but we have to make sure that it is also coupled with a better delivery in quarter four. And normally that's what happens because the cycle of yearly cycle of KPIs takes effect towards the end of the year.
Thank you, Datuk and Mr. Badrul. Due to the time constraints, I think we can have one last question from the floor. Since there is no question from the floor, ladies and gentlemen, at the moment, I believe we have addressed all the questions from the analysts.
That is all the time that we have for the Q&A. I would like to thank you for your questions. Now I will pass to Datuk Ir. Megat Jalaluddin Bin Megat Hassan, President and CEO of TNB, for his closing remarks.
Thank you very much, Azim. Ladies and gentlemen in this room as well as over the online. Thank you very much for the questions. As always, please reach out to our Investor Relations team for any further clarifications. We hope that we have provided a good answer moving forward for the company. To summarize today's session, the group's third quarter performance continued to reflect the stability of our regulatory business and the steady momentum from the commercial sector demand, particularly data centers, business services, as well as our retail customers. We are also seeing strong progress across our strategy initiative right to the ASEAN Power Grid corporations.
I think all of you will hear more, especially on the APG next year as we move into the execution mode to strengthen Malaysia's position as the regional clean energy hub. As we charge forward under the National Energy Transition Roadmap, we see significant opportunities in RE energy generation, grid modernization, and customer-driven energy solutions. We remain focused on capturing these opportunities responsibly while supporting Malaysia's pathway towards net zero 2050. So in conclusion, we reaffirm our commitment to driving sustainable growth and enhancing grid readiness and shaping Malaysia's long-term energy transition. To continue the trust and support, we remain confident in our ability to build a stronger, greener, and resilient energy future for the nation. Rewarding our shareholders remains the top priority, and we truly value your continued confidence in us. Once again, thank you very much and have a pleasant day ahead. [Foreign language] .
[Foreign language] .
Thank you, Datuk Megat. Ladies and gentlemen, we have come to the end of our session. On behalf of Tenaga Nasional Berhad, we thank you for your participation in today's briefing. For any questions that remain unanswered, rest assured that we will promptly address them following this event. If you require further clarification or inquiries, feel free to contact our Investor Relations officers or email us at tenaga_ird@tnb.com.my. To all our attendees, whether present physically or virtually, we appreciate your time and engagement. As you leave the hall, we warmly invite all analysts to help themselves to a light refreshment available at the back. Thank you once again, and we look forward to seeing you in future sessions. Take care and have a wonderful day.