PM vows electricity tariff hikes won’t burden ordinary Malaysians

KUALA LUMPUR – Prime Minister Datuk Seri Anwar Ibrahim has assured Malaysians that any increase in electricity tariffs will not have a significant impact on the majority of the population.

Speaking in Langkawi today, he said that the government will ensure that tariff hikes do not burden the general public.

“We will not allow electricity price increases that negatively affect the people,” the prime minister said.

“Such hikes, like those in the past, primarily impacted the affluent and industries with substantial profits. The vast majority of the public will not be affected, even though I understand that costs are rising.”

He emphasised that while cost increases are inevitable, they must not harm the financial stability of the majority of Malaysians.

“This is a policy decision. I understand the necessity for hikes, but they must not place an additional strain on the general public.”

Anwar further said that Tenaga Nasional Berhad (TNB) and Deputy Prime Minister Datuk Seri Fadillah Yusof will provide more detailed explanations regarding the tariff adjustments.

Yesterday, the state-owned utility firm announced that the new base electricity tariff for Peninsular Malaysia under the fourth regulatory period (RP4) will be set at 45.62 sen per kilowatt-hour (kWh), effective from July 1, 2025.

The regulatory rate of return remains unchanged at 7.3%, in line with the previous regulatory period (RP3).

According to Bernama, RHB Investment Bank Bhd (RHB IB) has expressed a positive outlook regarding TNB’s RP4 announcement, noting that the higher operating expenditure (opex) allowed could support essential operational and maintenance activities for the utility’s electrical infrastructure.

Analyst Sean Lim explained that under RP4, the capital expenditure (capex) allowance will increase to RM42.8 billion, which is 108% higher than the capex allowed under RP3.

“The allowed opex has also been lifted by 16% to RM20.8 billion compared to RP3,” Lim added. He also noted that the total allowed average annual capex of RM14.3 billion exceeds the investment bank’s expectations.

Lim further stated that, although TNB’s full regulatory returns are yet to be clarified, the higher capex and stable rate of return suggest potential positive surprises in the coming years. He also highlighted the ongoing development of a 500-megawatt large-scale solar photovoltaic plant, which will strengthen TNB’s green energy footprint.

Despite the adjustments to tariffs, the government has committed to ensuring that the majority of Malaysians are not unduly affected by the changes. – December 27, 2024