ABSTRACT
On his return from Malaysia, Alan Whitworth reported a less promising picture of Pergau than that indicated by the High Commission on the telephone. Although the demand forecast for electricity underlying the case for Pergau now looked reasonable, the case for early implementation rested crucially on the ability to build it at or around the cost (£140 million at 1986 prices) estimated in the SMEC feasibility study. The consortium had indicated a figure of £316 million in current prices (i.e. allowing for future cost escalation), which – on Whitworth’s calculation – worked out at 48 per cent higher than the SMEC price. SMEC had done a sensitivity analysis, which showed that, with a 20 per cent higher price, Pergau would remain economically viable. Whitworth was doubtful whether, with a 48 per cent higher price, this would still be the case; but without more analysis and direct access to TNB’s planning model, he was unable to give a firm view. He noted that there was a wish on the part of the Malaysian government on security grounds for some diversification away from fossil fuels. Some extra cost for hydro might be tolerable on these grounds – but only within a limited range. 1
