Malaysia's economic growth created a dramatic rise in electricity demand. To address the situation, in 1990 the Government corporatised the National Electricity Board to form Tenaga Nasional Berhad - and paved the way for independent power producers (IPPs) to enter the market
The first IPP licence was granted to the infrastructure group YTL Corporation Berhad. In November 1993, its subsidiary YTL Power Generation Sdn Bhd began construction of two power plants, with a combined generating capacity of 1212 MW, at Paka, Terengganu and Pasir Gudang, Johor.
The turnkey contractor was a joint venture between Syarikat Pembenaan Yeoh Tiong Lay Sdn Bhd (SPYTL) and Siemens AG - one of the world's largest turbine manufacturers and power plant suppliers.
For the operation and maintenance of the plants, Siemens and YTL jointly established YTL Power Services - the first time Siemens had become directly involved in power plant O&M after construction, commissioning and handing over to the client.
YTL Power Services was incorporated in October 1993. During the construction phase the company rapidly built up its infrastructure - recruiting, developing procedures and systems, and training staff intensively. By October 1994, less than a year after the start of construction, commercial production of electricity in open cycle began at both stations.
For its scale, the project was one of the fastest ever built. With just 22 months from start to finish, it set a world record even for Siemens. Such rapid progress added to the challenge of O&M mobilisation, but YTL Power Services kept pace with this performance, and began commercial operation seven months ahead of the original schedule.