No guarantee power tariffs won't increase, says minister

PARLIAMENT The government cannot guarantee that power tariffs will not increase, said Energy, Green Technology and Water Minister Maximus Ongkili.

However, he stressed that the government will ensure that any increase will not burden consumers.

Explaining, Maximus said this could be done by renegotiating the Power Purchase Agreements (PPA) with independent power producers (IPP).

He said the electricity tariff in the peninsula is determined by the incentive-based regulation (IBR) framework, which comprises imbalance cost pass-through (ICPT) and basic tariff.

The basic power tariff, he added, would take into account the basic rate of fuel, operations cost and the development of utilities, which includes the return on regulated asset base (RORB).

The ICPT, he said, allows all fuels to be coordinated every six months to ensure that users pay the actual fuel amount.

"Any changes in cost will by passed on to the consumer through review once every six months.

"These two tariff components will determine the exact bill needed to be paid to TNB," he added in a parliamentary written reply.

He said the government had provided a rebate of RM2.57 billion thrice from March 2015 to June 2016.

Ongkili added that the government has also taken steps to ensure that the electricity tariff is fixed at a given rate after considering the actual costs.

The minister was responding to BN Kuala Selangor MP Irmohizam Ibrahim who asked about measures being taken by the government to ensure that power tariff will not continue to escalate. -Mkini