Electricity bill protection expansion to cost RM248mil over 4 months

KUALA LUMPUR: Expanding electricity bill protection to households consuming up to 800 kWh a month is expected to cost RM248 million over four months, Deputy Prime Minister Datuk Seri Fadillah Yusof said.

Fadillah, who is also Energy Transition and Water Transformation minister, said the measure would benefit about 90 per cent, or eight million, of domestic consumers in Peninsular Malaysia.

He said the financial implications comprised three main components.

"The RM180 million Automatic Fuel Adjustment (AFA) cost will be jointly borne by the government and Tenaga Nasional Bhd (TNB) for September, while TNB will fully absorb the remaining costs from October to December.

"TNB will also fully bear the RM36 million retail charge for the period from September to December, while the government will absorb the RM32 million in Sales and Service Tax exemptions for the same period," he said in a written parliamentary reply yesterday.

He was responding to Lim Guan Eng (PH-Bagan), who asked about the cost of electricity bill protection for domestic consumers under the existing 600 kWh monthly threshold, equivalent to about RM220, and the proposed expansion to 800 kWh.

Lim also asked who would bear the costs and whether the threshold could be raised to 1,000 kWh, equivalent to about RM367 a month, following increased electricity consumption due to hot weather and haze.

On the proposal to raise the threshold to 1,000 kWh a month, Fadillah said he welcomed suggestions for improvements, but stressed that the proposal needed to be examined thoroughly.

He said the assessment would take into account the financial implications, the number of consumers who would benefit, the funding source and the measure's effectiveness in helping households affected by higher electricity consumption.

Meanwhile, Fadillah said the ministry, together with the Energy Commission, TNB and the Single Buyer, was reviewing the AFA mechanism to identify improvements for implementation from 2027.

"The review takes into account consumption patterns and levels by consumer category, changes in fuel and generation costs, and the impact on domestic and non-domestic bills.

"A fairer and more targeted approach to cost distribution, including the causer-pays principle, is also being evaluated to ensure additional generation costs are shared more equitably," he said.

He said the government was also considering consumers' affordability, the industrial sector's competitiveness and the financial sustainability of the electricity supply industry.

Any decision on extending the protection would be made only after the review was completed, he added.