FAQs on Tariff

Key Highlights

1.    How much is the ICPT amount to be passed through to customers?


ICPT amount to be passed through to customers is – RM 726.99 million. This will be translated to ICPT quantum of - 2.25 sen/kWh (i.e. tariff reduction) – applicable for the period starting 1st March until 30th Jun 2015.


2.    Who will be affected by this tariff reduction?


This tariff reduction will be applicable to all customers except Domestic customers with monthly consumption of 300 kWh and below.


3.    Why Domestic customers with monthly consumption of 300 kWh and below are not affected by this ICPT tariff reduction?


(i) Tariff rate for Lifeline Band consumers (0-200 kWh) has been maintained at 21.8 sen/kWh since 1997; and
(ii) Tariff rate for 201-300 kWh band has been maintained at 33.4 sen/kWh since 2009.


4.    Does  Domestic customers under the Lifeline Band with monthly bill of RM20 affected with this ICPT tariff reduction?


Around 1 million Domestic customers under the Lifeline Band with  monthly bill of RM 20 and below, their electricity bill is being subsidised by the Government. Therefore they will also not be affected by this ICPT tariff reduction.

What is Imbalance Cost Pass-Through (ICPT)?

Imbalanced Cost Pass Through (ICPT) is a mechanism under the Incentive Based Regulation (IBR) framework allowing TNB as the utility to reflect changes (either an increase or reduction) of the fuel and other generation costs in the electricity tariff every 6 months.

 

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Who is responsible for ICPT calculation methodology?

The Suruhanjaya Tenaga as Malaysia’s energy regulator determines the calculation and methodology of the ICPT, subject to government approval on a 6-monthly basis.

What are the components of Imbalance Cost Pass Through (ICPT) ?

There are two ICPT key components:

  • FCPT: Fuel Cost Pass-Through component captures any variation in fuel cost (specific to piped gas, LNG and coal) as a result of changes in the fuel price, fuel quantity, generation mix and etc.
  • GSCPT: Generation Specific Cost Pass-Through component captures any variation in other generation specific costs as a result of changes in other costs associated with the power purchase agreements (PPAs & Service Level, Agreements (SLA)) and fuel procurement contracts i.e. Coal Supply Agreement (CSA), Coal Supply and Transportation Agreement (CSTA), Gas Supply Agreement (GSA) /  Gas Framework Agreement (GFA) and etc.

 

How is the ICPT amount determined?

The ICPT is calculated based on an estimated actual fuel cost and estimated actual generation specific costs against a baseline cost that is incorporated in base tariff.

What is the ICPT rate that will be passed through to customers for the year 2014?

The ICPT rate that will be passed through  to customers for the period starting 1st March 2015 to 30th June 2015 is (- 2.25 sen/kWh), i.e. a rebate of 2.25 sen/kWh.

Why is the ICPT negative for the period Jan – Dec 2014 ?

  • The change in generation mix resulting in higher utilisation of coal has been the main contributing factor to the reduction in ICPT.
  • The current down trend in coal prices as well as the improved performances of the coal plants in the second half of 2014 has resulted in more electricity generated using this cheaper fuel compared to the more expensive LNG.

How will the ICPT impact my electricity bill?

  • It is a charge that is applicable for every kWh of electricity consumed. ICPT Charge is a variable component in the electricity bill where the ICPT Rate is charged based on your consumption of electricity on a monthly basis.
  • Any reduction in monthly consumption of electricity will help in bringing down the amount in this ICPT charge.
  • The ICPT is straight “pass-through” charge and its calculation is the number of kWh consumed in a month multiplies by the ICPT Rate (in sen/kWh).  The ICPT Charge will then be added to or subtracted from your current bill amount.

Will all customers be affected by ICPT passed through ?

  • Yes, all customers will be affected by ICPT passed through except for domestic customers with monthly consumption of 300 kWh and below.
  • In this regard, domestic customers with monthly consumption of 300 kWh and below will not experience any bill increase or bill reduction resulting from ICPT.  

 

Why do domestic customers with monthly consumption of 300 kWh and below are not affected by ICPT ?

  • The tariff rate for Domestic customers with monthly consumption of 200 kWh and below have not been changed since 1997 and remains at 21.8 sen/kWh (lifeline tariff)
  • Whilst, the tariff rate for domestic customers with monthly consumption of 201 – 300 kWh have also not been changed since 2009 and remains at 33.4 sen /kWh .
  • As such any increase or reduction in bill due to ICPT will not affect the domestic customers in the tariff band of 0 – 200 kWh and 201 – 300 kWh.
  • In this regard, domestic customers with monthly bill of RM 77 and below will not experience any bill increase or bill reduction resulting from ICPT.
  •  Around 1 million Domestic customers under the Lifeline Band with  monthly bill of RM 20 and below, their electricity bill is being subsidised by the Government. Therefore they will also not be affected by this ICPT tariff reduction.

Do all customers pay the same amount of ICPT charges?

The ICPT rate is fixed for all customers *(domestic customers with monthly consumption of 300 kWh and below are excluded from ICPT).  However, the ICPT charge on your electricity bill may differ from your neighbour's as the ICPT charge depends on the number of kWh consumed in a month.  Therefore this amount varies from one customers to another, and from month to month, depending on the consumption of that month.

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