Letter to Editor: Consultation on next power tariff hike needed

Source: www.imoney.my

Some of the national dailies’ headlines today reported that an electricity tariff hike is imminent and it is unavoidable due to the fossil fuel price hike.

As reported in the National Energy Balance 2011 by the Energy Commission, 83.4 percent of our electricity generation comes from fossil fuels such natural gas (52.5 percent) and coal (30.9 percent). Trends of further relying on fossil fuels are even more obvious when the government has approved a few coal-fired power plants to be installed in our country.

This shows that we are still relying heavily on fossil fuels, which are not renewable and depleting fast, while the renewable energy such as solar energy have to play the catch-up game even harder to achieve grid parity.

In 2011, a mechanism known as the Fuel Cost Pass Through (FCPT) was implemented where the gas price and electricity tariff will be reviewed every six months to reflect movements in fuel prices. The first review was implemented in June 2011 and we saw an average tariff hike of 7 percent. 

After the first round, the public and the industry players have been anticipating for another round of review in December 2011, June 2012, December 2012 and June 2013. However, the review seems to have been halted after the first round. This leads to more public agony and frustrates the industry players on when the next tariff hike would happen. 

The worst-case scenario for the next tariff hike might be as high as 28 percent with reference to the first round of review and this may cause a ‘bomb’ to the whole nation.  

Instead of getting a ‘bomb’, we would like to see a gradual increase or better known as the gradual subsidy rationalisation as being told by the government. 

We would like to be informed when is the next tariff review.  

We would like to be involved in the tariff review especially during the public consultation sessions, real public consultation sessions across the whole nation which involve all the general public, community leaders, NGOs and industrial sector. 

We would like to be assured on how the government is going to cushion the impact on the public after the tariff hike. 

We would like to see the money saved from the subsidy rationalisation being invested to the renewable energy sector, energy efficiency and conservation efforts, instead of building more coal-fired plants and also nuclear power plants. 

We are looking forward for a proactive action by the government to engage with the public, work together with the community leaders and NGOs and go to the ground and explain to the people on what is main reason for the tariff hike. 

Being transparent and effective communication with the rakyat is of the utmost importance for any policy to be implemented successfully and effectively nowadays.

This letter was first published in Malaysiakini on 8 Nov 2013, a few weeks before the announcement of the electricity tariff hike.