Next Peninsular Malaysia electricity tariff revision in January 2018

Energy, Green Technology and Water Ministry Secretary General Datuk Seri Ir Dr Zaini Ujang said the revision pertaining to the electricity supply revision is undertaken by the Energy Commission under the Imbalance Cost Pass-Through (ICPT) policy every six months.

"The latest was for January to June 2017.

"But on June 30, the government agreed to spend RM1.303 billion to cover the rising cost of fuel and electricity supply generation in the peninsular from July to December this year," he said in an interview on Bernama News Channel's "Ruang Bicara" programme on Wednesday.

Also present was Tenaga Nasional Bhd (TNB) Vice President (Regulatory Economics and Planning) Datuk Roslina Zainal.

Zaini said the expenditure of RM1.303 billion translates to a rate of 2.54 sen/kWh, where 1.52 sen/kWh is used to maintain the power tariff rebate and 1.02 sen/kWh to cover the surcharge for the rising cost of fuel and paid directly to TNB and independent power producers such as Malakoff Corporation Bhd and YTL Power Generation Sdn Bhd.

"This means the government did away with the charge that was supposed to have been imposed on consumers and took the decision to maintain the ICPT rebate rate of 1.52 sen/kWh to ensure electricity supply at the same tariff rate,' he added.

Zaini also said the future base tariff will also be decided in January 2018.

"At present, the base tariff to be revised every three years is at a fixed 38.53 sen/kWh," he added.

The base tariff also takes into account the base price for key fuel such as piped gas, coal and liquefied natural gas.

It also takes into consideration operational maintenance costs and development for the utility companies, including the "Return on Regulated Asset Base" (RORB), and decided by the government for four years from Jan 1, 2014 to Dec 31, 2017.

Determining the electricity tariff for the peninsular is according to the Incentive Based Regulations (IBR) framework comprising two important components, namely the ICPT and base tariff.

The base tariff is to cover all costs related to the supply of electricity to consumers.