Awer: Be transparent in setting power tariff

Posted on 27 June 2016

Source: The Sun Daily

The Association of Water and Energy Research Malaysia (Awer) is calling on the government to be transparent in the electricity tariff structure and fuel cost pricing with the half yearly review of the fuel cost component in the electricity tariff coming up at the end of June.

Piped gas was priced at RM15.20 per one million British Thermal Units (mmBTU), liquefied natural gas at RM41.68 per mmBTU and coal at US$87.50 a tonne for the tariff setting period from Jan 1, 2014 to Dec 31, 2017.

Under the Energy Commission’s Imbalanced Cost Pass Through mechanism, after every six months (January to June and July to December) additional costs or savings will be passed back to the electricity tariff. Savings will be reflected as rebates and additional costs as surcharges. So far, due to the reference prices of LNG and coal (which were set on Jan 1, 2014) being set higher than current market prices, rebates have been given.

Another increase in piped gas prices by the government, however, could lead to a reduction in the current rebate of 1.52 sen per kilowatt hour, Awer said.

“Therefore, Awer urges the Ministry of Energy, Green Technology and Water (KeTTHA) and the Energy Commission to disclose all the savings collected between January and June 2016. Any forward costing, for example additional costs that will be incurred by increase in piped gas prices, must be accounted for separately and not directly deducted from the savings. They must also publish savings from power purchase agreement renegotiations as well.

“These are costs that have been paid by consumers via tariff. KeTTHA and Energy Commission must disclose the information fully,” Awer said in a statement yesterday.

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