KUALA LUMPUR, June 28 — The surcharge exemption for domestic users in Sabah and Labuan, with a monthly electricity usage of 1,500 kilowatt-hours (kWh) and below, will be maintained from July 1 to December 31.

The Energy Commission (ST), in a statement, said that this was following the government’s decision today to implement electricity tariff adjustment under the implementation of the imbalance cost pass-through (ICPT) mechanism in a targeted manner during the period.

The ST said that domestic users (DM tariff) with electricity consumption units exceeding 1,500 kWh will, however, be charged a surcharge of 2.11 sen per kWh.

In addition, it said the ICPT surcharge exemption for non-domestic users in the low voltage commercial and industrial tariff category (CM1 and ID1 tariffs) will also be maintained while other non-domestic users will experience a reduction in the surcharge rate from 10.04 sen per kWh to 2.11 sen per kWh.

It added that the tariff setting for the Sabah Electricity Sdn Bhd (SESB) is implemented through Incentive-Based Regulation (IBR), which covers two main components, namely base tariff and ICPT rate.

"The base tariff is permanent during the IBR regulatory period, which is reviewed every three years. However, the ICPT rate is adjusted every six months, depending on changes in the cost of fuel for electricity generation,” the ST said.

The ICPT refers to a mechanism under the IBR, which enables fuel costs to be adjusted every six months, based on global fuel price fluctuations.

The ST said the six-month adjustment takes into account the difference between the cost of fuel and the actual cost of electricity generation, compared to the cost projected in the setting of SESB’s base tariff rate.

It added that any difference between the cost and projection during that period would, however, be released in the form of a rebate or surcharge through consumers’ electricity bill.

"If the actual cost exceeds the projected cost, then the consumer will be charged a surcharge. However, if the actual cost is lower than the projected cost, then the consumer will receive a rebate,” it said.

The ST explained that the significant increase in fuel costs caused the cost of electricity generation to increase by 13 per cent compared to what was projected in the basic tariff setting, thus impacting the cost of ICPT and electricity tariffs in general.

"In this context, the average prices of diesel and Medium Fuel Oil (MFO) increased by 58 per cent and 78 per cent compared to the fuel price projected in the basic tariff for the same period through the first regulatory period (RP1) under the IBR framework,” it said.

To reduce the impact of the targeted adjustment on consumers, the ST said the government will allocate a total of RM54.3 million as a subsidy to the categories of consumers involved.

The ST advised consumers to save electricity wisely by using energy-efficient electrical equipment, in addition to carrying out maintenance on electrical equipment periodically and switching off when not in use. — Bernama