Kuala lumpur: Gadang Holdings Bhd announced that its 60 per cent-owned subsidiary Tenaga Aspirasi Sdn Bhd (SPP) today signed a large scale solar photovoltaic power purchase agreement (PPA) with Sabah Electricity Sdn Bhd. Gadang said in a filing with Bursa Malaysia that SPP will design, construct, test, commission, own, operate and maintain the solar photovoltaic energy generating facility with a capacity of 15 Megawatt alternating current (MWac) located at Tawau, Sabah.

According to BERNAMA News Agency, the facility is set for connection to Sabah Electricity's medium voltage distribution network at the Kubota main distribution substation to generate and deliver solar photovoltaic energy to Sabah Electricity. The PPA outlines the obligations of SPP and Sabah Electricity to sell and purchase the energy generated by the facility for a period of 25 years from the commercial operation date, which is expected on November 30, 2026.

Gadang stated that the signing of the PPA will not have any material impact on the earnings and net assets of Gadang and its subsidiaries for the financial year ending May 31, 2026. However, the PPA is anticipated to contribute positively to the future earnings of the Gadang group. The board of directors of Gadang believes that the execution of the PPA is in the best interest of the Gadang group.

Previously, Gadang accepted a letter of acceptance from SPP to undertake the engineering, procurement, construction, and commissioning of a 15 MWac large-scale solar photovoltaic power plant project in Tawau, Sabah, valued at RM52 million. The contract was secured via a consortium comprising its wholly owned subsidiary Gadang Engineering (M) Sdn Bhd and JS Solar Sdn Bhd.