When Tan Chin Jeen learns that another one of his staff has found another job at a different power station he knows that competitors are pinching his experienced staff again. Taking it positively, he feels proud to have provided the good training and experience that helped a young Cambodian move up in life.
Tan serves as General Manager of Cambodia Utilities Pte. Ltd, a 35 megawatt oil-fired power plant in the southern part of Phnom Penh along National Route 2.
The power station is located on the original site of an old steam-fired power plant that had been owned by Electricity de Cambodge (EDC).
Today, operator of the site is Cambodia Utilities Pte Ltd. (CUPL) which became the first independent power plant in Cambodia, starting construction in 1995 with an operational station by late 1996.
Inside the power station, which is noisy and requires hearing protection, are seven Italian-made engine and generator units of 5 megawatts each.
CUPL has an 18-year build, own and transfer (BOT) agreement with the Eletricity du Cambodge (EDC) which ends in May, 2015. After that, the power plant will belong to EDC.
BOT agreements are popular methods around the world of financing infrastructure, in which the a private group makes an agreement with a government entity to finance a project, built and operate it long enough to get a return and some profit on their investment, and then return it to the government or semi-government client.
“So far we have been able to perform very well,” Tan said. “We are very lucky because this is formerly a steam plant with the fuel delivery facility in place for our fuel oil coming in from Vietnam on barges.”
An underground tunnel connects the plant with the Bassac River, enabling swift and easy access to water and fuel oil by barges.
“A few years ago we managed to overcome technical problems with the help of our manufacturers and our own experienced team; I consider this a very successful project.”
Tan doesn’t know what EDC will do with the power station when they inherit it in 2015, but he’s confident of continued success during the next four years until then.
CUPL’s parent company is Leader Universal Holdings Berhad of Malaysia, is a cable manufacturer that specializes in manufacturing cables for electricity transmission, distribution and telecommunication.
Leader Universal is currently building a 100 megawatt coal-fired power station in Sihanoukville, which is expected to come online in 2013.
“Because of high oil prices, the Cambodian government is switching from oil to coal and hydro power plants which are bigger in size and more economical.”
Tan estimates that the Cambodia National Electricity Grid, which is now under development, will meet the much higher power demand in the coming years. Currently the Phnom Penh Grid is delivering about 350 megawatts of power.
Electricity costs rise when fuel prices increase, according to a method called a “pass-through” cost.
“If there are any changes the price of oil, the cost is passed to the user. As a bunker fuel oil plant, our biggest cost is fuel. Coal prices are also going up. Even with bio fuel, the prices in future keep going up and up. Nothing is getting cheaper,” Tan said, noting that he has seen unbelievable increases in the price of the bunker oil used by the power station since commencement of operations in 1994.
“When we started in1994, the price was $90 per metric ton. Today, the price is $780 per metric ton. That’s exponential growth,” he said. “I never thought the fuel price would increase so much.”
CUPL is currently buying its bunker oil from Sokimex, which arrives by barges on the Bassac River.
To the oil seller, Cambodia oil market is not very big. A lot of oil comes from Singapore via Sihanoukville or via Mekong or Bassac River from Vietnam.
Coal for power plants generally comes from China, Indonesia or Australia and can arrive by ship at Sihanoukville or up the Mekong from Vietnam.
Tan says the Cambodian government already has a detailed plan for electricity generation in the future, with three or four hydroelectric plants and some coal-fired power plants before 2015 and a few more of these plants coming online by 2020.
CUPL’s electricity is injected into the Phnom Penh grid and the EDC sends it where it needs to go, Tan says.
Other than the Cambodian EDC diesel power plants, Cambodia’s other electric power players are KEP and CEP, both of which have six each 7.5 megawatt Wasilla diesel units (made in Finland), as well as Colben Energy of Singapore. Another player is Thai-owned Souvanah Phum power station, a small coal-fired plant that generates ten megawatts.
Tan says Cambodia does not have a national electricity grid at the present time, but the government has one in the planning stages that is hoped to be implemented in the next three to five years or slightly longer. The electricity regulatory authority in Cambodia is called the Electricity Authority of Cambodia (EAC).
Tan is proud to be a Malaysian in Cambodia, part of the nation that was for several years the biggest investor in Cambodia.
“As a Malaysian I am proud of this investment in Cambodia. I see with the growth of power demand as a good indicator of moving economy. I can definitely say that the people of Cambodia now have a brighter future.”
Perhaps once his assignment here is complete, Tan will return to Malaysia for a while and figure out what to do next.
“Maybe I’ll relax for a couple of years thinking about what is the next phase.”
Tan has three grown children, two daughters and a son either working or still studying in Malaysia. . His wife Meelan keeps the home in Penang.
“She plays a very big role in my family,” Tan says.
Tan was born Penang in 1958 the eldest of 3 brothers.
He attended Perak Polytechnic and studied automotive and became an engine man. His first job was with Tenaga, the Malaysia national power authority, which he joined in 1982
“My first job was very similar to what I’m doing now – operating diesel fuel plants generating 50 megawatts,” he said.