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Tariff & ICPT
1. How much is the ICPT rebate to be passed through to customers for the period of 1 January 2021 to 30 June 2021?
Imbalance Cost Pass-Through (ICPT) implementation for the period of 1 January – 30 June 2021 are as follows:
a) The average Base Tariff remain unchanged at 39.45 sen/kWh;
b) ICPT rebate of 2.00 sen/kWh will be implemented to all Domestic Customers including Domestic Customers with monthly consumption of 300kWh and below
c) ICPT rebate of 2.00 sen/kWh will be implemented to all Non Domestic Customers.
* Domestic customers refer to Residential customers
* Non-domestic customers refer to commercial, industrial customers and others
2. Who will be affected by this ICPT rebate?
For period January to June 2021, the ICPT rebate is set at 2.00 sen/kWh that will be applicable for both Domestic and Non Domestic Customers.
Domestic customers with monthly consumption of 300kWh (RM77.00) will also be eligible for the ICPT rebate at a rate of 2.00 sen/kWh.
3. Why Domestic customers with monthly consumption of 300 kWh (RM77.00) are now also getting the 2.00 sen/kWh rebate?
Domestic customers with monthly consumption of 300kWh (RM 77.00) and below were not affected in the previous tariff reviews i.e:
(i) Tariff rate for Lifeline Band customers (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.
However, for period January to June 2021, Government has decided to provide ICPT rebates to all customers including those consuming below than 300 kWh. This is to assist the low income and vulnerable customers under this consumption band who are affected by the COVID-19 pandemic, and in view of the discontinuation of the BPE electricity discount in December 2020.
In addition, the government allocates another RM 40.00 electricity subsidies specifically to poor hardcore domestic customers who are registered with the E-kasih program.
What is Imbalance Cost Pass-Through (ICPT)?
ICPT is a mechanism under the Incentive Based Regulation (IBR) framework which allows TNB as the utility to reflect changes (either increase or reduction) in fuel and other generation-related costs in the electricity tariff every six (6) months in the form of rebate or surcharge.
What are the major factors contributing to the rebate given in ICPT for period 1 January – 30 June 2021?
This ICPT rebate is a result of a reduction in actual fuel costs for the period of July to December 2020, consistent with the reduction in actual coal and gas prices for the power sector.
The following are the details of the actual fuel prices for the period of July to December 2020:
- Lower average coal price in the global market at USD58.6/MT, compared to the benchmark coal price set in the base tariff at USD75/MT; and
- Lower power sector gas price at RM 21.0/mmbtu, compared to the benchmark gas price set in the base tariff of RM27.20/mmbtu.
Who is responsible for ICPT calculation methodology?
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 is Kumpulan Wang Industri Elektrik (KWIE)?
Government fund via Kumpulan Wang Industri Elektrik (KWIE) was created and enforced on 1st January 2016 is a fund administered by Suruhanjaya Tenaga (Energy Commission). The objective of it is to manage and cushion the impact of electricity tariff to the customers. Not only that, KWIE can also function to buffer electricity prices at times of financial crisis.
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, liquefied natural gas (LNG) and coal) as a result of changes in the fuel price, fuel quantity, generation mix, exchange rate 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 (SLAs) 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 for pass through to customer is calculated?
The ICPT is calculated based on an estimated actual fuel cost and generation specific costs for a particular six (6) months period against the corresponding baseline costs in the Base Tariff.
Since its implementation in 2014 until June 2018, a total of RM6.3 billion of ICPT rebate and subsidy has been passed through to electricity customers in Peninsular Malaysia. Due to the increase in average coal price and the continuous increase of RM1.50/mmBTU in the regulated piped gas which has resulted to higher fuel and generation cost from July 2018 to June 2020, a total of RM3.7 billion of ICPT surcharge has been passed through to Non Domestic Customers in Peninsular Malaysia.
How will the ICPT impact my electricity bill?
- It is a charge that is applicable for every kWh of electricity consumed. ICPT is a variable component in the electricity bill where the ICPT is charged based on your consumption of electricity on a monthly basis.
- 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
Do all customers pay the same amount of ICPT charges?
The ICPT charge on your electricity bill may differ from your neighbour's as the ICPT charge depends on your energy consumption (kWh) in a month. Therefore, this amount varies from one customer to another and from month to month, depending on the energy consumption.
To reduce the ICPT impact, the consumers are advised to implement the electricity saving measures as recommended by the Suruhanjaya Tenaga.
What is the initiative from Government for customers to anticipate the next ICPT rate?
The government has provided a user-friendly ICPT Calculation platform through the www.myelectricitybill.my portal on the Suruhanjaya Tenaga official website. The ICPT calculator will help customers to estimate ICPT rate on their monthly electricity bills beginning January 2019.
The purpose of this ICPT Calculator is to educate customers to be more sensitive and alert to the changes in fuel prices and foreign exchange rates in the market. Customers can key in the coal and gas price forecasts as well as the fuel price & forex forecast to estimate the cost of ICPT at the next tariff adjustment.