PETALING JAYA: There should be more discussions between the government and stakeholders concerning the latest proposed electricity tariff adjustments, says the Federation of Malaysian Manufacturers (FMM).

       Its president Tan Sri Soh Thian Lai expressed disappointment with the government’s decision to maintain the Imbalance Cost Pass Through (ICPT) surcharge for the first half of 2024 at 17sen/kWh (sen per kilowatt-hour).

       “FMM had anticipated a reduction in the ICPT surcharge following the overall declining trend in global fuel prices this year and the six-month lag.

       “In particular, there is a drop in fuel prices from the previous ICPT and the current announcement, hence even a small reduction would still be welcomed by industries.

       “FMM hopes that more details would be made available on the decision to maintain the surcharge at the current rate as the industry was not consulted prior to the announcement this time around,” he said in a statement yesterday.

       Soh added that consistent engagement with industry players could address concerns and challenges over the tariff during the period of high ICPT surcharge rate.

       Such engagement, he said, was especially important for small and medium industries (SMIs) in the medium voltage (MV) category.

       “In this regard, there should be more robust customer profiling to review the eligibility of SMIs under the MV category.

       “This would enable them to qualify for a lower surcharge at 3.7sen/kWh as industries in general, including SMIs, continue to operate under a challenging environment since uncertainties around economic growth and inflation outlook remain in 2024 amid concerns on the impact of subsidy rationalisation as well as geopolitical risks,” he added.

       On Friday, the Energy Commission announced that the ICPT surcharge for non-domestic users in the commercial and low voltage industrial, specific agriculture, water and sewerage categories remains at 3.7sen/kWh.

       Apart from the categories above, a surcharge of 17sen/kWh will continue to be imposed on non-domestic users.

       Small and Medium Enterprises Association of Malaysia president Datuk William Ng said industry players were concerned with the uncertainty posed by the ICPT mechanism.

       “Energy costs remain a major concern for small and medium enterprises, and while we support the energy transition roadmap, we must be careful that any incremental costs are gradual and supportive of growth,” he told Bernama.

       He added that the ICPT was meant to be a temporary measure to address a spike in operational cost and not a mechanism to guarantee the national energy company’s profitability.

       The ICPT refers to a mechanism under the Incentive-Based Regulation which allows Tenaga Nasional Bhd to incorporate changes in fuel and other generation-related costs in the tariff every six months.