Electricity tariff will not be raised this year, says minister

Energy, Green Technology and Water Minister Datuk Seri Maximus Ongkili says though fuel price has gone down but electricity tariff cannot be reduced because fuel accounts for only 1% of the cost of producing energy. – The Malaysian Insider pic, March 25, 2015.Energy, Green Technology and Water Minister Datuk Seri Maximus Ongkili reiterated the electricity tariff will not be raised this year.

"The government is monitoring the price of fuels used in electricity production such as coal, piped natural gas and liquefied natural gas (LNG).

"Currently, we are giving subsidy for piped natural gas. Coal is steady and we don't expect its market price to see a big drop," he said in reply to a supplementary question from Datuk Ahmad Fauzi Zahari (BN-Setiawangsa) who asked whether the government could assure that the electricity tariff will not be raised this year if the price of fuels remain.

Earlier, to the original question from Fauzi on whether the government plans to reduce electricity tariff due to the decline in world oil prices, Ongkili said the decline did not have significant impact on electricity tariff.

"This is because fuel accounts for only one percent of overall fuel mix for producing electricity, namely coal, piped natural gas and LNG.

"The cost of producing electricity has also been reduced due to improved performance by coal-fired plants, thus reducing the dependence on other high-priced fuels."

The RM726.99 million savings via the Imbalance Cost Pass-Through (ICPT) would be given to consumers in Peninsular Malaysia via rebate of 2.25 sen/kWh from March 1 to June 30.

Ongkili said the government decision would affect all domestic consumers using 300kWj per month and all commercial users and industries.

"The ICPT mechanism has not been implemented in Sabah and Labuan but in line with the decline in crude oil prices, there are various fuel savings.

"In an effort to reduce the people's burden, the government agreed that the average tariff of 34.52 sen/kWh be reduced by 1.20 sen/kWh for Sabah and Labuan from March 1 to June 30, 2015," he added. – Bernama