Lower electricity tariffs

New Straits Times, 8 February 2009

TAMPIN: The government will announce soon a reduction in electricity tariffs that will take effect from March 1.

Energy, Water and Communications Minister Datuk Shaziman Abu Mansor said he would present a report on the proposed downward tariff revision to the cabinet on Wednesday.

Shaziman said his ministry had been in discussion with the Economic Planning Unit to revise the gas price for the power sector to facilitate for lower electricity tariffs.

"We are pushing for an early review of the price of gas that Petronas sells to the power sector, in view of the declining prices of crude oil."

Shaziman, who is also the member of parliament for Tampin, said this after opening the Olek Kampung harm reduction (methadone) programme at the district health office here yesterday.
A review was supposed to be due only in the middle of this year, which will be a year after the previous review, but the larger reduction in crude oil prices from US$140 per barrel to US$43 per barrel has prompted the authorities to make an early revision.

Electricity tariffs were raised 24 per cent last July following the rise in gas and coal prices and maintenance costs.

At present, domestic users are paying 21.8 sen per kilowatt hour (kWh) if their monthly usage does not exceed 200 kWh. However, for usage of between 201 kWh and 400 kWh, they have to pay 34.5 sen per kWh unit.

The rates increase on subsequent 100 kWh -- 30 sen for 401-500 kWh, 39 sen (501-600 kWh), 40 sen (601-700 kWh), 41 sen (701-800 kWh) and 43 sen (801-900 kWh).

A maximum of 46 sen is charged for each kWh when electricity usage reaches 901 kWh and above.

Shaziman said a comprehensive study was being carried out into industries and sectors that used a lot of energy to identify the relevant categories that were eligible for special tariff discounts.

"The incentive for electricity should ideally benefit value-added industries, for example business sectors that contribute to the country's economic growth."

Meanwhile, he said that Johor was expected to be the third state to hand over its water assets to Pengurusan Aset Air Bhd later this month, after Malacca and Negri Sembilan.

He also said he had responded to a letter written by the Selangor government, requesting for his views on whether the state should terminate the 30-year concession agreement with Syarikat Bekalan Air Selangor.