ABOUT eight million domestic electricity users in Peninsular Malaysia will remain shielded from additional electricity charges until the end of the year, as surging global fuel prices and reduced power generation capacity drive up electricity costs.
Deputy Prime Minister Datuk Seri Fadillah Yusof said households consuming up to 800 kilowatt-hours (kWh) a month, equivalent to an estimated bill of RM328 or less, were fully exempt from Automatic Fuel Adjustment (AFA) surcharges, sales and service tax (SST) and retail charges from Sept 1 to Dec 31.
He said the government had expanded the protection on Sept 18 to prevent the full impact of the global energy crisis from being passed on to consumers.
“The government has taken seriously the increase in electricity bills for some domestic consumers in Peninsular Malaysia, which is due to a chain of factors I have outlined,” he said during Minister’s Question Time in the Dewan Rakyat today.
Fadillah was responding to Azli Yusof (PH-Shah Alam), who asked about the factors behind the recent sharp rise in household electricity bills and how the situation aligned with assurances by the Energy Commission (ST).
Fadillah, who is also Energy Transition and Water Transformation (PETRA) Minister, said global gas and coal prices in the second and third quarters of 2026 had risen well above the baseline prices set under the Incentive-Based Regulation (IBR) framework for the fourth regulatory period (RP4), covering 2025 to 2027.
The increase, driven by geopolitical tensions in West Asia, particularly security disruptions in the Strait of Hormuz, had raised electricity generation costs in Peninsular Malaysia and translated into higher AFA surcharges on electricity bills.
He cited prolonged hot weather, which had increased the frequency and duration of air-conditioner use, as another factor pushing up household electricity consumption.
At the same time, lower hydropower generation due to extended hot conditions and scheduled shutdowns at coal-fired power plants had increased reliance on imported liquefied natural gas (LNG), which was more costly during the crisis.
“As a result, the cost of purchasing fuel for electricity generation during the crisis has been higher than projected for the RP4 period,” he said.
Fadillah said the exemption covered about 90 per cent of domestic electricity users in Peninsular Malaysia, exceeding the Energy Commission’s assurance in April that at least 85 per cent of households would remain protected.
Consumers using less than 1,000kWh a month could also qualify for rebates under the energy-efficiency incentive scheme introduced as part of the new electricity tariff structure that took effect on July 1, 2025.
The incentive was intended to encourage more efficient electricity use.
“User-Pay” Principle
Separately, Fadillah said the government was studying options for next year’s electricity tariff structure, including a possible “user-pay” principle under which charges would reflect consumption levels.
The review would examine energy-intensive users, particularly industrial consumers and data centres, as well as possible differences between domestic and industrial tariff rates to ensure household interests remained protected.
“The approach is still under consideration by the government and has not been finalised,” he said. - October 15, 2026