TNB allocates RM20b in CAPEX for the next 3 years

by PRIYA VASU / graphic by MZUKRI MOHAMAD

UTILITY group Tenaga Nasional Bhd has allocated RM20 bil in capital expenditure (CAPEX) for the next 3 years with the government’s approval, said TNB’s Chief Regulatory and Stakeholder Management Officer, Datuk Wira Roslan Ab Rahman.

“The fund will be used to maintain a safe and resilient network and systems, meet customer’s demand and enable the group to support the government’s energy transition initiative in the next 3 years,” he said in a media briefing yesterday.

The government recently made an announcement to maintain the current base electricity tariff for all electricity users in Peninsular Malaysia throughout the Regulatory Period 3 (RP3) from Feb 1, 2022 to Dec 31, 2024, said the Energy Commission (EC).

The government will impose an electricity tariff surcharge of 3.7 sen per kilowatt hour (kWh) for non-domestic users for the February to June 2022 period, while maintaining a two sen rebate for domestic users, the Energy Commission said in a statement on Jan 28.

The EC delayed the Regulatory Period 2022-2024 (RP3) for the electricity industry from 2021.

Under the RP2018-2020 (RP2) extension, the base tariff remained at 39.45 sen/kwh.

There was no disclosure on the new RP3 parameters, but TNB said it will be updated soon.

Kenanga Investment Bank Bhd in a research note recently said that the 2.0 sen/kWhtariff rebate is given to domestic customers, 3.7  sen/kWhtariff  surcharge is  imposed  on  non-domestic  users  to  counter  the  rising coal  costs. 

This is positive as to clear earlier market concern of TNB having to  bear  the  extra cost of higher coal prices.

“While there are no changes to base tariff, we are still positive given the surcharge imposed on non-domestic users signifying the fuel cost pass-through mechanism is indeed in place,” said Kenanga.