TNB intends to implement an increased base tariff for Peninsular Malaysia for the period 2025–2027, commencing in July of next year

For Peninsular Malaysia, Tenaga Nasional Bhd proposes to adopt the new pricing schedule with a base price of 45.62 sen per kilowatt-hour under Regulatory Period 4 (RP4) on July 1, 2025.

Regulatory Period 3 (RP3), which ran from 2022 to 2024, had a basic rate of 39.95 sen/kWh.

The Electricity Industry Fund (KWIE) would cover any discrepancies between January and June 2025, according to the statement. “The current electricity tariff schedule, which has been in place since 2014, will continue to be in effect, with no change in the electricity tariff rate and tariff structure until June 30, 2025,” TNB stated in a Bursa Malaysia filing today.

TNB has maintained the regulation rate of return at 7.3%, in accordance with RP3. This will allow the utility company to undertake necessary investments in the sector, guaranteeing a steady and dependable supply of power to meet the increasing demand.

During this time, coal and gas continue to be the main fuel sources for electricity generation, and generation expenses continue to account for the largest portion of the power tariff.

Any increased generation costs brought on by rising fuel prices for the delivery of electricity would be passed through the Imbalance Cost Pass-Through (ICPT) mechanism, according to TNB. “TNB remains neutral in this regard, and there will be no impact on the company’s business operations or financial position,” said the statement.

A recent government approval will implement RP4 under the Incentive-Based Regulation (IBR) framework from January 2025 to December 2027.The utility company reported that the Energy Commission (EC) sent a letter to TNB on December 24, 2024, informing them of the decision.

RM42.821 billion was the total amount of permitted capital expenditure (capex), which was made up of RM16.267 billion in contingent capex and RM26.554 billion in base capex.

“The total allowed capex for RP4 is set to bring significant economic benefits towards stimulating the nation’s economy and preparing the electricity network to facilitate the nation’s energy transition agenda,” according to TNB.

It was also said that the RM20.782 billion in allowed operating expenditures helps plan and carry out important maintenance and operation tasks for all of TNB’s electrical assets.

The government’s commitment to the IBR framework, which has served as the cornerstone of the stability and sustainability of the energy supply sector, was demonstrated by the decision to adopt the RP4, according to TNB.

“Through RP4 implementation under IBR, TNB commits to ensuring a reliable and continuous supply of electricity to our customers, enhancing customer service levels, and facilitating the nation’s energy transition agenda,” said the statement.