Latest news with #IBR
The Star
7 hours ago
- Business
- The Star
Fairer electricity rates for 23.6 million in Peninsular Malaysia
Automatic Fuel Adjustment (AFA) will replace the ICPT mechanism, enabling monthly updates to electricity charges based on market fuel prices and forex rates, according to the Energy Commission. Over 23.6 million domestic users in Peninsular Malaysia will benefit from fairer and more progressive electricity rates with the implementation of the new electricity tariff schedule approved by the government. This tariff will take effect from July 1 to Dec 31 2027 under the Incentive-Based Regulation (IBR) framework, in line with the provisions under Section 26 of the Electricity Supply Act 1990. The electricity tariff revision for the Fourth Regulatory Period (RP4) involves the restructuring of the following three (3) components: (i) average base tariff rates; (ii) new tariff schedule; and (iii) fuel costs adjustment mechanisms. Adjustment of the average base tariff rate The average base tariff is adjusted based on the estimated cost of electricity supply for the RP4 period and set at 45.40 sen/kWh compared with 45.62 sen/kWh approved in December 2024. With this adjustment, the overall average electricity tariff cost is reduced by up to 19 per cent compared with the Third Regulatory Period (RP3). Electricity tariff structure changes cover customer categories, charges and incentives The introduction of the new tariff schedule covers the following: (i) a revision of customer categories, divided into domestic and non-domestic, based on voltage usage, whether low, medium or high voltage; and (ii) the setting of charges for the energy, capacity, network and retail components, based on their respective costs. The Energy Efficiency Incentive will be introduced to encourage 23.6 million domestic users to adopt prudent electricity consumption practices. Through this incentive, domestic users with electricity consumption of 1,000 kWh and below are not expected to be affected by the implementation of the new tariff schedule. In addition, non-domestic low voltage users with electricity consumption of 200 kWh and below will also benefit from this incentive. In addition, the Time of Use (ToU) scheme has been streamlined and expanded to offer a longer off-peak period, covering the entire Saturdays and Sundays, as well as from 10PM to 2PM on weekdays from Monday to Friday. This is to encourage more efficient consumption management based on demand periods, in line with efforts towards a more efficient and sustainable energy system. By shifting their usage to off-peak periods, consumers can reduce their electricity bills compared to using electricity during peak periods. To ensure that social and welfare needs continue to be looked after, the government has agreed to: (i) apply specific tariffs for the agriculture, water and sewerage services, as well as rail operators or traction; (ii) a 10 percent rebate will be provided for registered institutions of higher learning, schools, charitable homes, and places of worship; and (iii) continue the RM40 Electricity Bill Rebate Programme, which provides a monthly subsidy of up to RM40 for Heads of Households (KIR) categorised as hardcore poor and registered with the e-Kasih system under the Prime Minister's Department (PMD). Eligible users can check their eligibility status via official portal or by visiting their nearest electricity utility provider office. The new rates are expected to provide greater cost efficiency for everyday Malaysian households. Overall, this approach is intended to encourage energy efficiency initiatives and the use of renewable energy, delivering shared benefits through a more efficient and sustainable energy system. To support this, all users will receive their electricity bills in a new, more detailed format (itemised billing). Following the implementation of this new tariff schedule, the majority of users are expected to remain unaffected. In fact, users who practise efficient energy consumption will enjoy greater savings through the Energy Efficiency Incentive. Refinement of the cost adjustment mechanism For the energy charges component, a new and more dynamic fuel cost adjustment mechanism, the Automatic Fuel Adjustment (AFA), will replace the Imbalance Cost Pass-Through (ICPT) mechanism. This mechanism enables automatic adjustments to generation costs based on current market fuel prices and foreign exchange rates. These details will be reported monthly on the Energy Commission's website. Implementation and user support services The new tariff schedule will take effect from July 1 and this will be reflected in electricity bills based on usage from July 2025 onwards. Details of the rates and new categories (where applicable) can be checked through the following channels: The tariff schedule will be published on the website from June 21, at 12.00 noon; An estimate of future monthly electricity bills can be calculated using the electricity tariff calculator, which will be accessible from July 2025 via the abovementioned website earliest by June 23; For further enquiries, users are encouraged to contact TNB CareLine at 1-300-88-5454, email tnbcareline@ or reach out through other official TNB platforms.
New Straits Times
8 hours ago
- Business
- New Straits Times
Fairer, progressive rates
KUALA LUMPUR: More than 23.6 million domestic users in Peninsular Malaysia will benefit from fairer and progressive rates with the implementation of the new electricity tariff schedule approved by the government. This tariff schedule will take effect from July 1, 2025, to Dec 31, 2027, under the incentive-based regulation (IBR) framework, in line with provisions under Section 26 of the Electricity Supply Act 1990. The electricity tariff revision for the fourth regulatory period (RP4) involves restructuring three components, which are average base tariff rates, the new tariff schedule and fuel cost adjustment mechanisms. Average Base Tariff The average base tariff is adjusted based on the estimated cost of electricity supply for RP4 and set at 45.40 sen/kWh, lower than the 45.62 sen/kWh approved in December last year. With this adjustment, the overall average electricity tariff cost will be reduced by 19 per cent compared with the third regulatory period (RP3). Tariff Structure Changes The introduction of the new tariff schedule includes a revision of customer categories, now divided into domestic and non-domestic groups based on low, medium or high-voltage supply. It also involves the setting of charges for the energy, capacity, network and retail components, each determined according to their respective costs. The Energy Efficiency Incentive will be introduced to encourage 23.6 million domestic users to adopt prudent electricity consumption practices. Through this incentive, domestic users with electricity consumption of 1,000kWh and below are not expected to be affected by the new tariff schedule. In addition, non-domestic low-voltage users with consumption of 200kWh and below will also benefit from this incentive. Meanwhile, the time-of-use (ToU) scheme has been streamlined and expanded to offer longer off-peak periods, including Saturdays and Sundays, as well as from 10pm to 2pm on weekdays. This is to encourage more efficient consumption management based on demand, in line with efforts towards a more efficient and sustainable energy system. By shifting their usage to off-peak periods, consumers can reduce their electricity bills compared with peak periods. To ensure that social and welfare needs continue to be looked after, the government has agreed to apply specific tariffs for the agriculture, water and sewerage services, as well as rail operators or traction. A 10 per cent rebate will be provided for registered higher-learning institutions, schools, charity homes and houses of worship. The government will also continue the RM40 electricity bill rebate programme, which provides a monthly subsidy of up to RM40 for heads of households categorised as hardcore poor and registered with the e-Kasih system under the Prime Minister's Department. Eligible users can check their eligibility status via or by visiting their nearest utility branch. Overall, this approach is intended to encourage energy efficiency initiatives and the use of renewable energy, delivering shared benefits through a sustainable system. To support this, all users will receive their electricity bills in a new, detailed format (itemised billing). Despite the implementation of this new tariff schedule, the majority of users are expected to remain unaffected. In fact, users who practise efficient energy consumption will enjoy greater savings through the Energy Efficiency Incentive. Refinement of Cost Adjustment Mechanism For the energy charges component, the current imbalance cost pass-through (ICPT) mechanism will be replaced by a new and more dynamic fuel-cost adjustment system known as automatic fuel adjustment (AFA) mechanism. This enables automatic adjustments to generation costs based on current market fuel prices and foreign exchange rates. These details will be reported monthly on the Energy Commission's website. Implementation and User Support Services The new tariff schedule will take effect from July 1. Details of the rates and new categories (where applicable) can be checked through the following channels. THE new tariff schedule will be published in at noon on June 21; and AN estimate of future monthly electricity bills can be calculated using the electricity tariff calculator, which will be accessible at earliest on June 23. For further enquiries, users are encouraged to contact TNB CareLine at 1-300-88-5454, email tnbcareline@ or reach out through other official TNB platforms. Energy Commission's Commitment As the energy regulatory body in Peninsular Malaysia, the Energy Commission is committed to ensuring that the implementation of tariffs is guided by the principles of fairness, transparency and sustainability to meet the country's needs and balance the interests of all energy consumers. This comprehensive restructuring and harmonisation is an important step towards realising and strengthening a fair and inclusive national energy transition agenda.
The Star
8 hours ago
- Business
- The Star
Fomca lauds new 'B40-friendly' electricity tariffs
KUALA LUMPUR: The Federation of Malaysian Consumers Associations (Fomca) has expressed full support for the implementation of the new electricity tariff structure under Regulatory Period 4 (RP4). The new tariffs will take effect from July 1, 2025, to Dec 31, 2027, under the Incentive-Based Regulation (IBR) framework. Describing it as timely, progressive and beneficial for Malaysian households, Fomca chief executive officer Dr T. Saravanan said the new tariffs reflects a fairer and more transparent energy pricing system. "This initiative comes at a crucial time when many households are facing financial pressures due to inflation and the rising cost of living," he said. Saravanan said the revised tariff structure reduces the average base tariff from 45.62 sen/kWh to 45.40 sen/kWh, contributing to an estimated 19% reduction in total average electricity costs compared to the previous regulatory period. Although the rate cut may appear marginal, he said it is supported by structural reforms that provide greater protection to domestic consumers, particularly those in the B40 and M40 income groups. Saravanan said the introduction of the "Energy Efficiency Incentive" allows households that consume 1,000 kWh or less per month to avoid any tariff increase, thereby rewarding energy-efficient users and encouraging responsible consumption. "The updated structure also includes a more detailed billing system, with breakdowns of energy generation, network usage, capacity charges, and retail costs. "This level of transparency empowers consumers to understand their bills better and provides clarity on how costs are derived," he said. The expanded "Time of Use" scheme now includes weekends and off-peak weekday hours from 10pm to 2pm the next day, enabling consumers to enjoy further savings by shifting high-usage activities to these periods. Fomca also welcomed continued protection for vulnerable groups, including a RM40 monthly rebate for hardcore poor households under the e-Kasih programme, and dedicated tariffs for the agriculture, water, sanitation, and rail sectors. A 10% rebate for educational institutions, places of worship, and registered welfare homes will also remain in place. Saravanan said the replacement of the Imbalance Cost Pass-Through mechanism with the new Automatic Fuel Adjustment system would enhance price responsiveness to global fuel and currency movements. He however stressed the need for clear communication on any resulting price changes. He urged the Domestic Trade and Cost of Living Ministry to step up enforcement against unjustified price hikes in essential goods that may be triggered by the tariff adjustment. "Fomca will continue to monitor the implementation closely and advocate for ongoing consumer engagement, education and regulatory enforcement to maximise the impact of this policy reform," he said. The Energy Commission on Friday (June 20) announced that starting July 1, 2025, over 23.6 million domestic users in Peninsular Malaysia will benefit from fairer and more progressive electricity rates under the newly approved tariff schedule for Regulatory Period 4 (2025-2027). This includes changes to the average base tariff rate, the tariff structure and the fuel cost adjustment mechanism, implemented under the Incentive-Based Regulation framework. – Bernama
The Sun
8 hours ago
- Business
- The Sun
FOMCA backs new RP4 electricity tariff, calls it fair and timely
KUALA LUMPUR: The Federation of Malaysian Consumers Associations (FOMCA) has expressed full support for the implementation of the new electricity tariff structure under Regulatory Period 4 (RP4), describing it as timely, progressive and beneficial for Malaysian households. FOMCA chief executive officer Dr T. Saravanan said the new tariff, which will take effect from July 1, 2025, to Dec 31, 2027, under the Incentive-Based Regulation (IBR) framework, reflects a fairer and more transparent energy pricing system. 'This initiative comes at a crucial time when many households are facing financial pressures due to inflation and the rising cost of living,' he told Bernama. He said the revised tariff structure reduces the average base tariff from 45.62 sen/kWh to 45.40 sen/kWh, contributing to an estimated 19 percent reduction in total average electricity costs compared to the previous regulatory period. Although the rate cut may appear marginal, Saravanan said it is supported by structural reforms that provide greater protection to domestic consumers, particularly those in the B40 and M40 income groups. Saravanan said the introduction of the 'Energy Efficiency Incentive' allows households that consume 1,000 kWh or less per month to avoid any tariff increase, thereby rewarding energy-efficient users and encouraging responsible consumption. 'The updated structure also includes a more detailed billing system, with breakdowns of energy generation, network usage, capacity charges, and retail costs. 'This level of transparency empowers consumers to understand their bills better and provides clarity on how costs are derived, thereby enhancing trust and enabling more responsible consumption decisions,' he said. The expanded 'Time of Use' (TOU) scheme now includes weekends and off-peak weekday hours from 10 pm to 2 pm the next day, enabling consumers to enjoy further savings by shifting high-usage activities to these periods. FOMCA also welcomed continued protection for vulnerable groups, including a RM40 monthly rebate for hardcore poor households under the e-Kasih programme, and dedicated tariffs for the agriculture, water, sanitation, and rail sectors. A 10 percent rebate for educational institutions, places of worship, and registered welfare homes will also remain in place. Saravanan said the replacement of the Imbalance Cost Pass-Through (ICPT) mechanism with the new Automatic Fuel Adjustment (AFA) system would enhance price responsiveness to global fuel and currency movements, but stressed the need for clear communication on any resulting price changes. He also urged the Domestic Trade and Cost of Living Ministry (KPDN) to step up enforcement against unjustified price hikes in essential goods that may be triggered by the tariff adjustment. 'FOMCA will continue to monitor the implementation closely and advocate for ongoing consumer engagement, education and regulatory enforcement to maximise the impact of this policy reform,' he said. The Energy Commission today announced that starting July 1, 2025, over 23.6 million domestic users in Peninsular Malaysia will benefit from fairer and more progressive electricity rates under the newly approved tariff schedule for Regulatory Period 4 (2025–2027). This includes changes to the average base tariff rate, the tariff structure and the fuel cost adjustment mechanism, implemented under the Incentive-Based Regulation framework.
The Sun
9 hours ago
- Business
- The Sun
FOMCA backs fairer, transparent electricity tariff reform
KUALA LUMPUR: The Federation of Malaysian Consumers Associations (FOMCA) has expressed full support for the implementation of the new electricity tariff structure under Regulatory Period 4 (RP4), describing it as timely, progressive and beneficial for Malaysian households. FOMCA chief executive officer Dr T. Saravanan said the new tariff, which will take effect from July 1, 2025, to Dec 31, 2027, under the Incentive-Based Regulation (IBR) framework, reflects a fairer and more transparent energy pricing system. 'This initiative comes at a crucial time when many households are facing financial pressures due to inflation and the rising cost of living,' he told Bernama. He said the revised tariff structure reduces the average base tariff from 45.62 sen/kWh to 45.40 sen/kWh, contributing to an estimated 19 percent reduction in total average electricity costs compared to the previous regulatory period. Although the rate cut may appear marginal, Saravanan said it is supported by structural reforms that provide greater protection to domestic consumers, particularly those in the B40 and M40 income groups. Saravanan said the introduction of the 'Energy Efficiency Incentive' allows households that consume 1,000 kWh or less per month to avoid any tariff increase, thereby rewarding energy-efficient users and encouraging responsible consumption. 'The updated structure also includes a more detailed billing system, with breakdowns of energy generation, network usage, capacity charges, and retail costs. 'This level of transparency empowers consumers to understand their bills better and provides clarity on how costs are derived, thereby enhancing trust and enabling more responsible consumption decisions,' he said. The expanded 'Time of Use' (TOU) scheme now includes weekends and off-peak weekday hours from 10 pm to 2 pm the next day, enabling consumers to enjoy further savings by shifting high-usage activities to these periods. FOMCA also welcomed continued protection for vulnerable groups, including a RM40 monthly rebate for hardcore poor households under the e-Kasih programme, and dedicated tariffs for the agriculture, water, sanitation, and rail sectors. A 10 percent rebate for educational institutions, places of worship, and registered welfare homes will also remain in place. Saravanan said the replacement of the Imbalance Cost Pass-Through (ICPT) mechanism with the new Automatic Fuel Adjustment (AFA) system would enhance price responsiveness to global fuel and currency movements, but stressed the need for clear communication on any resulting price changes. He also urged the Domestic Trade and Cost of Living Ministry (KPDN) to step up enforcement against unjustified price hikes in essential goods that may be triggered by the tariff adjustment. 'FOMCA will continue to monitor the implementation closely and advocate for ongoing consumer engagement, education and regulatory enforcement to maximise the impact of this policy reform,' he said. The Energy Commission today announced that starting July 1, 2025, over 23.6 million domestic users in Peninsular Malaysia will benefit from fairer and more progressive electricity rates under the newly approved tariff schedule for Regulatory Period 4 (2025–2027). This includes changes to the average base tariff rate, the tariff structure and the fuel cost adjustment mechanism, implemented under the Incentive-Based Regulation framework.
