KUALA LUMPUR (Jan 16): The Energy Commission (EC) clarified today that the announced RM929.37 million rebate that the government will provide to maintain current electricity tariffs in Peninsular Malaysia will be actually be borne by Tenaga Nasional Bhd.
In December, Energy, Green Technology and Water Minister Datuk Maximus Ongkili said the government has agreed to keep the current electricity tariff rate for Peninsular Malaysia for the next three years. To do so, Ongkili said the government would provide the subsidy, which translates to a rebate of 1.80 sen per kilowatt-hour, between Jan 1 and June 30 this year, or RM929.37 million in total.
"If you ask me whether the money is coming from the government treasury, the answer is no. It is coming from the electricity supply system," EC chairman Datuk Abdul Razak Abdul Majid said at a press briefing on electricity tariff review in Peninsular Malaysia today.
The sum, or the imbalance cost pass through (ICPT) rebate, will be absorbed by Tenaga via unused capital expenditure and operating expenditure approved by the EC in the first regulatory period of 2015 to 2017 under the incentive-based regulations (IBR) mechanism, according to EC's acting chief executive officer Azhar Omar.
"There were some savings in the system — there were capex and opex reduction — meaning they (Tenaga) did not use all that had been approved to them. So with all these savings, we are using them to cushion the next impact, from January to June this year. That is why Tenaga is willing to do it, because they know that they have not spent the whole capex and opex that we approved for them," he said.
During RP1, Azhar said the approved capex was RM18.5 billion while approved opex was RM18.4 billion, but Tenaga only used RM17 billion as capex and RM17.5 billion opex.