The increase in electricity tariffs is needed to cover the costs of electricity supply maintenance in Peninsular Malaysia and producing energy from gas sources, the Energy Commission said today.

NONESpeaking at a briefing session on the tariff hike in Putrajaya today, the commission's CEO Ahmad Fauzi Hasan (right) said the costs also involve plenty of repair works to energy plants and for problems with the system.

Ahmad Fauzi said the problems identified have been plaguing the commission for the past three years.

"We also face the problem of not having enough supply to supplement the energy demands in Peninsula Malaysia," he said.

"In terms of inflation, the maintenance and workforce costs have forced us to raise our tariffs."

However, Ahmad Fauzi said, said the current tariff mechanism was monitored based on incentives.

"TNB is given one year to do the maintenance works. If we follow this structure, there won't be another tariff hike for the next four years," he said.

'Tariff hike is only 2.6pct'

Ahmad Fauzi stressed that the tariff hike was only 2.6 percent compared to the existing tariff of 33.54 sen per unit, while saying that his commission also takes into account the increase in inflation rates every year.

However, he said that the commission could not guarantee if the tariff would not be hiked again in the near future because it is also related to the price of energy sources.

“But what we expect is for the price not to increase much and maybe the price would go down in the future,” he said.

He also said that the commission will revise the price of gas as supplied by the federal government.

“There will not be a price hike which we will call a smart move. We just hope that in the future with subsidy reduction, the national deficit can be eliminated by 2020,” he said.

In a press conference after that, he said that the commission would act as a supervising agency for TNB and will also monitor TNB’s effectiveness after the tariff hike in January next year.

“We are looking at the effectiveness of TNB operations from the commercial and technical viewpoints. The commission will ensure a more detailed study next year,” he said.

NONE

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