POWER HIKE:Rafizi slams BN for protecting IPP cronies, warns low-income groups WILL BE HIT, inflation WORSEN

KUALA LUMPUR - MP for Pandan Rafizi Ramli has slammed the decision by Prime Minister Najib Razak to hike electricity tariffs by 15% effective January 1, 2014, warning that the move will hit across the board, with the low-income groups not spared the pain as claimed by the authorities.

Rafizi lambasted the Najib administration for protecting cronies including independent power producer firms controlled by tycoons Syed Mokhtar, Ananda Krishnan, Yeoh Tiong Lai, at the expense of the people.

"Real issue is this - if electricity tariff is expensive because national utility TNB has to buy expensive electricity from Independent Power Producers due to lopsided agreements, the natural thing to do if a government cares for the welfare of the people is to renegotiate or undo the lopsided agreement so that tariffs can stay reasonable," Rafizi told Malaysia Chronicle.

Energy, Green Technology and Water Minister Maximus Ongkili had announced at a press conference this afternoon that electricity prices in Peninsular Malaysia would be raised by 4.99 sen to 38.53 sen per kilowatt next year.

Sabah and Labuan would suffer an increase of 5sen.

Consumers, BEWARE: Inflation will WORSEN

In an email to Malaysia Chronicle, Rafizi also listed out the following points

1) The 15% hike will hit families at all levels, even if they use less than 300 kwH per month

2) Students or bachelors or working class sharing houses to make ends meet are good example of people who will be hit directly. It's normal to have 10 people sharing a house and the consumption is >300 kWH because a lot of people in the house - they will be penalised although they are low income group

3) Likewise there are 2-3 families sharing the same dwelling (grandfather and father etc) in KL and elsewhere because people can't afford separate houses - they too will be hit by this

4) Worst are consumers in Sabah/Sarawak who are already paying high because they do not have direct electricity supply but have to buy from a middleman who control the supply to their kampung, this will hit them even worse because the middleman will increase what they charge

5) So, directly there are lower income groups who will get a direct hit on this

6) Indirectly, the higher tariff means higher operating and business costs which will inevitably push businesses to revise prices to protect margin

7) This will continue the trend of increasing prices of essential products and services

8) Real issue is this - if electricity tariff is expensive because national utility TNB has to buy expensive electricity from Independent Power Producers due to lopsided agreements, the natural thing to do if a government cares for the welfare of the people is to renegotiate or undo the lopsided agreements so that tariffs can stay reasonable. - MORE TO COME - Malaysia Chronicle