TNB to bear RM929.37m in electricity rebates for first six months of 2018

PUTRAJAYA: Tenaga Nasional Berhad (TNB) will be bearing the RM929.37 million in rebate to maintain the current electricity tariff in Peninsular Malaysia for the first six months of the year instead of the government, according to the Energy Commission (EC), today.
EC acting CEO Azhar Omar said contrary to TNB's announcement on Dec 27, the rebate will be borne by TNB through the electricity supply system instead of the Treasury Department.
"Under the incentive-based regulations (IBR) mechanism, the sum, or the imbalance cost passed through (ICPT) rebate, will be absorbed by TNB via unused capital expenditure (capex) and operating expenditure (opex) approved by the EC during the first regulatory period of 2015 to 2017," he told reporters during a media briefing at the EC's headquarters, here, today.
Azhar said following the Regulatory Period 1 (RP1) which ended last year, TNB had saved some monies following cuts to capex and opex which will be utilised to ensure that there is a subsidy and rebate of 1.80 sen/kWh for the period of Jan 1 to June 30, 2018.
This includes 0.28 sen/kWh of surcharge from the additional cost of generation and 1.52 sen/kWh to continue the ICPT rebate for TNB customers.
However, TNB had reportedly stated that the 1.52 sen/kWh ICPT rebate will not be made available to domestic consumers with a monthly consumption of 300 kWh and below.
"For other users, this means they will pay the same rate for their electricity usage for the period of Jan 1 to June 30, 2018."
He stated that during RP1, TNB managed to save RM2.4 billion in capex and opex from EC's approved sum.
Beyond the six months, Azhar said monies from the Electricity Industry Fund (KWIE) is expected to sustain the increasing cost for electricity-generating elements such as piped gas, coal and liquefied natural gas to ensure that electricity tariff rates remain the same until 2020.