Due to the unstable nature of fuel prices, the government may resort to opening up the power producing industry to avoid a surge of electricity tariff hikes in the future.

The government is studying the possibility of licensing independent power producers (IPPs) to sell electricity to the government-owned power utility company Tenaga National Berhad (TNB).

This would allow debt-ridden TNB to buy cheaper electricity due to increased competition between the IPPs, said Energy, Water and Communications Minister Dr Lim Keng Yaik.

"This is a global trend that we're looking into," said Lim, adding that the model has shown success in several European countries and Australia.

At present, TNB plays three major roles in the industry - generating, transmitting and distributing electricity - coupled with another nine IPPs, owned by four major corporations, which sells electricity to TNB.

Unlike the idea being studied, the nine IPPs are not in competition as they are selling electricity at a fixed price based on their respective concession agreement.

RM30 bil debt

While reiterating that there was no tariff hikes in electricity for the time being, Lim was tight lipped as to when the plan can be realised but assured that studies are under way.

He elaborated that the plan was considered for long-term benefits and thus needed thorough discussions and studies in order to "satisfy all parties involved".

Recently, TNB had sought government permission to raise tariff by 10 percent, but the proposal was rejected in view of the March 1 30 sen fuel hike.

The state-controlled power firm, which has debts exceeding RM30 billion, has not revised power prices since 1997 despite rising operating costs, and will submit another proposal soon.

Second chances

In a separate development, Lim who is also Gerakan president said the party-sponsored Wawasan Open University would begin enrolling students as early as October this year.

Stressing that the university was strictly not-for-profit, Lim hopes to enrol between 400 to 500 students in various pre-university, business and engineering courses.

He added that entry requirements would be low, as even Penilaian Menengah Rendah holders with relevant working experience would be admitted should the applicant passes entry assessment.

"As long as they are willing and possess the ability to study, we will admit them [...] Our purpose is to give those less fortunate a second chance," said the minister at a press conference after chairing the Gerakan monthly central committee meeting.

Students would be given up to 10 years to collect enough credit points to qualify for a degree, said Lim.