2 sen/kWh electricity rebate for all users from Jan 1-June 30, 2021 - Shamsul Anuar

Energy and Natural Resources Minister Datuk Dr Shamsul Anuar Nasarah said with the rebate, 7.5 million domestic consumers would see a reduction of between 3.6 per cent and 9.2 per cent in their electricity bills, while commercial users would experience between four per cent and 5.2 per cent reduction in their bills.

Meanwhile, industrial users will see a reduction of between 4.6 per cent and 6.1 per cent, he said.

Shamsul Anuar said the government had agreed to maintain Tenaga Nasional Bhd’s (TNB) average base tariff at 39.45 sen/kWh for 2021.

“The first rebate given since July 2018 will be enjoyed by all TNB electricity users, domestic and non-domestic.

“This measure is taken following the government’s decision to extend TNB's Second Regulatory Period under the Incentive Based Regulation (IBR) mechanism until Dec 31, 2021,” he said at the announcement of the new electricity tariff rate for 2021 here, today.

He said the government had also agreed to pass the fuel cost savings to all TNB users following the drop in coal and gas prices in the second half of the year in line with the implementation of the Imbalance Cost Pass Through (ICPT) mechanism for the period from Jan 1 to June 30, 2021.

“The government hopes that this rebate offer can help alleviate the cost of living of the people and reduce the cost to run businesses that are affected by the outbreak of the COVID-19 pandemic,” he added.

Meanwhile, in a filing with Bursa Malaysia today, TNB said the rebate is for all customers including domestic users with monthly consumption of 300kWh and below.

“This ICPT rebate is a result of a reduction in actual fuel costs for the period from July to December 2020, consistent with the reduction in actual coal and gas prices for the power sector,” it said.

During the period, the average coal price in the global market stood at US$58.6 per tonne compared to the benchmark coal price set in the base tariff at US$75 per tonne while gas price is lower at RM21 per million British Thermal Units (mmbtu) compared to the benchmark gas price set in the base tariff of RM27.20/mmbtu.

“Any shortfall or excess in the ICPT will be funded or transferred to customers via the Electricity Industry Fund (KWIE) to aid in the stabilisation of electricity tariff in the future via gradual build-up of the fund,” it said.

Any variations in the fuel costs would be addressed via the ICPT mechanism, it added.

“With this, the Third Regulatory Period is shifted by one year to start on Jan 1, 2022 and ends on Dec 31, 2024.

“This decision was made following the uncertainty in demand outlook for 2021 and the instability of the current global fuel markets following the COVID-19 pandemic,” it said.

TNB said it believed that the impact of ICPT implementation is neutral on the company and would not have any effect on its business operations and financial position.