Electricity tariff subsidies to cost govt RM6.51 billion this year

The government will be spending RM6.51 billion on electricity tariff subsidies this year to ensure that there is no increase in electricity tariffs to help the people deal with inflation.

Deputy Energy and Natural Resources Minister Ali Biju said this followed the announcement by Prime Minister Ismail Sabri Yaakob on June 24 that the government would maintain a rebate of two sen per kilowatt hour (kWh) for all domestic consumers and a surcharge of RM3.70 sen/kWh for all non-domestic consumer in the peninsula from July 1 until Dec 31, 2022.

"This means that all users in the peninsula will pay electricity tariffs at the same level as they have been paying since January 2022," he said during the question-and-answer session at the Dewan Negara today.

He was replying to Khairil Nizam Khirudin who wanted to know the amount of subsidies that had been and would be allocated by the government through the Energy Commission to ensure that there is no increase in electricity tariffs to help the public cope with inflationary pressure.

Ali said that from January 2021 until June, the government had allocated RM715 million to maintain a rebate of two sen/kWh for all domestic consumers even though a surcharge of RM3.70 sen/kWh should be imposed on electricity consumers in the peninsula starting January 2022.

He also said that any subsequent electricity tariff decisions would be based on the imbalance cost past through mechanism at the end of this year, which will depend on the price of fuel supply at the global level.

He said the ministry through the Energy Commission and finance ministry would study the possibility of providing targeted energy subsidies.