Singapore, 14 July (Argus) — Palm biomass mills in the eastern Malaysian state of Sabah can now produce up to 120MW of electricity, but some of the mills are too far from transmission grids to be economically viable.

The Malaysian Palm Oil Board is proposing that utility Sabah Electricity raise electricity purchase prices from about 0.21 ringgit/kWh ($0.06/kWh) to around 0.31-0.35 ringgit/kWh to make it profitable for the palm oil mills.

The electricity generated still falls short of the full potential 260MW that can be produced by all 120 mills in the state, the country's plantation and commodities ministry said. There are 428 palm mills in Malaysia producing 58mn t of palm oil effluent each year.

Sabah will be the focus of the Malaysian government's proposed roadmap for palm biomass production to help ease power supply shortages.

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