PARLIAMENT | The non-revision of the electricity tariff since 2012 has nothing to do with 1MDB's acquisition of three power plants with high cost, as claimed by the opposition, the Dewan Rakyat was told today.
This is how Energy, Green Technology and Water Minister Maximus Ongkili rebutted Tony Pua (DAP-Petaling Jaya Utara) during the winding up of 2018 Budget debate today.
"Pua claimed that the electricity tariff could not go down since the acquisition of Tanjong Energy, Genting Sanyen and Jimah by 1MDB in 2012. He said the electricity cost was borne by the rakyat.
"But the power tariff and power cost have nothing to do the acquisition because 1MDB purchased them and maintained the tariff after liberalisation as stipulated under the final sales and purchase agreement of the independent power plants (IPP).
The electricity tariff in Peninsular Malaysia was fixed under the mechanism of Incentive-Based Regulation (IBR) since 2014, according to him.
In its IPP restructuring exercise, Ongkili said the government set conditions for six major IPP to reduce their cost by fixing an RM6 per kilowatt for 48 months, which led RM1.6 billion being saved.
According to him, the company owned by 1MDB - Edra Energy, was part of the exercise and has helped to stabilize the current tariff.
"(Pua's) accusations that we signed a lopsided concession agreement at an expensive price, that gave 1MDB a lucrative profit, is incorrect," he said.
1MDB bought Tanjong Power in May 2012 for RM8.5 billion and Jimah Energy Ventures for RM1.23 billion.
The state-owned fund later sold Edra Global Energy to China General Nuclear Corp (CGN) for RM9.83 billion cash in March 2016.
During his budget debate on Oct 31, Pua said Genting Berhad had claimed it made an RM1.9 billion profit from its RM2.3 billion sales of energy assets to 1MDB.
"This shows that the actual value of Genting Sanyen is only RM400 million but 1MDB bought it at RM2.3 billion," he added.- Mkini
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