The government has announced that it will be implementing a targeted electricity subsidy between 1 January to 30 June 2023, which allows domestic users to continue enjoying a rebate of 2 sen/kilowatt hour (kWh) on their power tariff. Non-domestic users, meanwhile, will need to pay a specified amount of surcharge – depending on whether they fall into the lower, medium, or high-voltage category.

Specifically, farmers and animal breeders, as well as lower voltage (LV) non-domestic users – such as micro businesses and small and medium enterprises (SMEs and MSMEs) – will be charged the existing 3.7 sen/kWh surcharge. These include restaurants, groceries, bakeries, and small workshops.

Medium voltage (MV) and high voltage (HV) consumers, on the other hand, will see a surcharge of 20 sen/kWh being implemented from 1 January 2023 onwards. This is due to the increased cost of generating electricity following a hike in global coal prices.

Natural Resources, Environment, and Climate Change Minister, Nik Nazmi Nik Ahmad said that with this latest update to the electricity tariff, the government will continue to bear a total of RM10.76 billion in subsidy. “The actual cost of subsidy to maintain the current electricity tariff is RM14.91 billion. However, with this targeted subsidy scheme, an additional allocation of RM4.16 billion which would have gone to bear the cost of electricity subsidy can now be allocated to help the rakyat through other means,” he said.

Nik Nazmi also highlighted that RM8.74 billion will be allocated to ensure that domestic users, farmers and breeders, as well as LV non-domestic users will be exempted from any tariff increase following this latest adjustment through the Imbalance Cost Pass-Through (ICPT) mechanism.

Briefly, the ICPT is a mechanism that allows Tenaga Nasional Berhad (TNB) to review the electricity tariff every six months, ensuring that its charges reflect the changes in fuel and other generation-related costs. Meanwhile, Malaysia’s current electricity tariff (for the period of July – December 2022) offers a 2 sen/kWh rebate to all domestic electricity consumers, whereas non-domestic consumers are charged a surcharge of 3.7 sen/kWh (regardless of whether they fall into the LV, MV, or HV category).

(Source: The Edge Markets)

• TAGS:
• Electricity Bills
• Electricity Rebates
• Electricity Subsidy
• Electricity Tariff
• Nik Nazmi Nik Ahmad
• Tenaga Nasional Berhad
• TNB Imbalance Cost Pass Through (ICPT)