By Chan Quan Min
Tenaga Nasional Bhd (TNB) this afternoon confirmed a hike in electricity tariffs across the country starting next year.
Peninsular Malaysia will see an increase of just under 15% or 4.99 sen per kilowatt-hour (sen/kWh), bringing the new average electricity tariff to 38.53 sen/kWh.
Sabah and Labuan will be hit with a higher increase, by as much as 16.9% or 5 sen, according to reports quoting Energy, Green Technology and Water Minister Maximus Ongkili.
For domestic consumers, the rate for the ‘lifeline band’ or monthly consumption of up to 200 kWh, has been maintained at a subsidised rate of 21.8 sen/kWh, unchanged since 1997, said TNB in a note to the stock exchange.
In addition, consumers of electricity below 300 kWh per month would not experience any tariff increase, as the applicable rate for the 201-300 kWh band has been maintained at 33.4 sen/kWh.
Hence, according to TNB, there would be effectively no tariff increase to 70.7% of household consumers totalling 4.6 million customers.
Another change introduced by TNB is a reduction of tariff bands from the current nine bands to just five. TNB contends this exercise was for the purposes of “better understanding of the tariff structure.”
Meanwhile, commercial consumers will experience an average increase of 16.85% within a range of between 1.2% to about 18%.
Industrial consumers will experience an average increase of 16.85% within a range of between 0.9% to about 17%.
‘Special industrial tariff’ (SIT) consumers will experience an increase of about 19%. According to TNB, this is in line with the government’s effort to gradually reduce subsidies to industries. “Even with this increase, SIT consumers will continue to enjoy discounted tariff rates, as compared to the rates for normal industrial consumers,” TNB added.
The 10% discount on electricity bills currently enjoyed by government schools, government institutions of higher learning, places of worship and welfare homes registered with the government as well as educational institutions partly-funded by the government as been maintained.
Finally, the electricity rebate by the government for domestic consumers with a monthly bill of RM20 or lower will be maintained.
Further pricing changes are detailed in the announcement this afternoon to the stock exchange, reproduced below:
“Tenaga Nasional wishes to inform that the government today has announced that effective Jan 1, 2014 the average electricity tariff in the Peninsula will be increased by 4.99 sen/kWh or 14.89% from the current average of 33.54 sen/kWh to 38.53 sen/kWh based on four components:
-The adjustment of domestic gas price from RM13.70/MMBtu to RM15.20/ MMBtu will affect the electricity tariff by 1.52% or 0.51 sen/kWh;
-The price of imported liquefied natural gas (“LNG”) fixed at RM41.68/ MMBtu will have an impact on the electricity tariff by 10.17% or 3.41 sen/kWh;
-The adjustment of base price for coal from USD85/metric tonne to USD87.5/metric tonne CV 5500, kcal/kg will also have an impact on the electricity tariff by 0.51% or 0.17 sen/kWh; and
-The review of TNB’s base tariff which is being raised by 2.69% or 0.90 sen/kWh from the current average tariff. This base tariff will be regulated through a mechanism called ‘Incentive based regulation’ to be administered by the Energy Commission.
To enhance the promotion of renewable energy in the country, the government has also decided to revise the collection from consumers for the renewable energy fund from 1% to 1.6% effective Jan 1, 2014. The 1.6% collection will be payable by all electricity consumers, except for domestic consumers who use less than 300 kWh per month.”
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