Two incentives to lighten financial burden of water companies

The Environment and Water Ministry has announced two incentives to reduce the financial burden of water companies during Movement Control Order (MCO), to ensure continuous water supply.

Its Minister Datuk Tuan Ibrahim Tuan Man said the National Water Services Commission (SPAN) is giving exemption on the annual licence fee to individual licence holders by as much as 30 per cent of their total revenue.

The move, he said would provide a saving of RM24 million to the licence holder while realising a revenue loss to SPAN.

Besides that, he said the Water Asset Management Company (PAAB) is suspending its existing water asset lease payment for three months beginning April 2020, involving a total sum of RM100 million in payment suspension.

"The suspension is only applicable to lease agreement on state government water supply loan, taken over by PAAB through the restructuring of the country's water services industry," he said in a statement today.

Tuan Ibrahim said MCO has affected water companies financially as there was a 60 per cent decrease in demand for water by the industrial and commercial sectors, besides having to bear escalating operating cost, especially the cost of chemicals such as chlorine and electricity bill.

This is due to SPAN's directive to water operators to increase the chlorine content of treated water from 0.2 parts per million (ppm) to 0.5 ppm to destroy COVID-19 virus as advised by the World Health Organisation (WHO).

Other costs include electricity, which is 50 per cent of the operation cost to produce one cubic metre of clean water, he said.

Tuan Ibrahim said the ministry through SPAN will continue to monitor water supply during MCO and apply the necessary measures to protect the needs and well-being of Malaysians.

-- BERNAMA