FMM calls for more electricity relief for industrial consumers

The Federation of Malaysian Manufacturers (FMM) is looking forward to more COVID-19 relief measures from energy providers in particular for the more severely affected manufacturing sub-sectors including those heavily linked to the construction and hospitality sectors.

In a statement, FMM president Tan Sri Soh Thian Lai said the industry had expected to see a drop in overall electricity tariffs given the drop in global fuel prices.

"This would provide a reprieve to manufacturers during the current challenging period as there has been very little assistance for manufacturers to mitigate the energy cost impact caused by COVID-19 and the Movement Control Order (MCO)," said FMM.

Yesterday, the Energy Commission stated that no surcharge would be imposed under the Imbalance Cost Pass-Through (ICPT) review for the period from July to December 2020.

As energy is a major cost factor for the industry, which has contributed more than 37 per cent of Tenaga Nasional Bhd’s (TNB) electricity sales, FMM has also recently engaged with the energy-related authorities to put forward several appeals.

They include extending the electricity tariff discounts by another two months, and a further discount of up to five per cent as most companies especially those categorised as non-essential did not benefit from it during April and May 2020 where usage was almost zero or minimal as production was halted due to the MCO, whereas they still had to bear the overheads and fixed costs.

FMM also appealed for the electricity bills for February and March 2020 to be apportioned out for affected companies similar to the easy payment plan offered to residential customers, as well as for the waiver of late payment charges.

FMM also asked for a review of the maximum demand (MD) charge calculation for the month of March to reflect the days in operation in view of the MCO as well as the natural gas price to reflect the decline in global fuel prices, besides a waiver of the Take-or-Pay (TOP) penalty clause in view of the possible prolonged impact of COVID-19 on businesses locally and globally - to help lower business costs and sustain operations.

FMM is also calling for Gas Malaysia Energy Services (GMES) Sdn Bhd to defer its decision to impose excess gas charges beginning from July 2020 until the economy recovers.

"FMM urgently calls for these relief measures to be duly considered expeditiously in order to support business and employment sustainability in view of the external uncertainties and long recovery period," Soh said.

The Statistics Department recently indicated that given the current global economic climate, the manufacturing sector would require some time to recover from the adverse impact of the COVID-19 pandemic as it is strongly dependent on global demand, with almost 69 per cent of the nation’s manufacturing output exported.

-- BERNAMA