8 million households to be exempted from selected electricity charges

KUALA LUMPUR: About eight million domestic consumers in Peninsular Malaysia will be exempted from selected electricity bill charges from Sept 1 to Dec 31, the Dewan Rakyat heard today.

Energy Transition and Water Transformation Minister Datuk Seri Fadillah Yusof said consumers using up to 800 kilowatt-hours (kWh) a month, equivalent to an estimated bill of RM328 or less, would be exempted from Automatic Fuel Adjustment (AFA) surcharges, Sales and Service Tax (SST) and retail charges.

He said the measure covered 90 per cent of domestic consumers in Peninsular Malaysia, exceeding the Energy Commission's (ST) assurance in April that at least 85 per cent would remain protected.

Meanwhile, consumers using less than 1,000 kWh a month are also eligible for rebates under the Energy Efficiency Incentive scheme, introduced under the new tariff structure on July 1, 2025, to encourage efficient electricity use.

Fadillah said rising global fuel prices amid the geopolitical crisis in the Middle East had contributed to higher electricity bills.

"The surge in world fuel prices is closely related to the geopolitical crisis in the Middle East, specifically security disruptions in the Strait of Hormuz, which is one of the world's most important energy routes," he said in reply to a question from Azli Yusof (PH-Shah Alam).

Fadillah said the strait handled about 20 per cent of global crude oil and liquefied natural gas trade and was a key route for 40 per cent of Malaysia's fuel supply.

The disruption pushed gas and coal prices in the second and third quarters of 2026 above the base prices set under the Incentive-Based Regulation (IBR) framework for the 2025-2027 regulatory period.

Under the AFA mechanism, fuel cost changes are reflected in monthly adjustments based on global market prices. Consumers receive rebates when generation costs fall below the projected base price, while surcharges apply when costs exceed it.

Fadillah said higher fuel prices had increased electricity generation costs in Peninsular Malaysia, resulting in AFA surcharges on consumers' bills.