KUALA LUMPUR: The Energy Commission has approved the Imbalance Cost Pass-Through (ICPT) adjustment for the period of July 1 until Dec 31, 2020.
Tenaga Nasional Bhd (TNB), in a filling with Bursa Malaysia, said it received the approval from the commission via a letter dated June 30, 2020.
It said the government has approved a reduction in the ICPT for this period from the current 2.00 sen/kilowatt-hour (kWh) surcharge to 0.00 sen/kWh for non-domestic customers.
“This reduction in ICPT surcharge is due to a reduction in actual fuel costs for the period of January to June 2020 compared with the previous six months period of July to December 2019,” it said.
TNB also noted that for January-June 2020 period, average applicable coal price was at US$69.5/metric tonne (MT).
Since January 2020, the gas price was set based on the Reference Market Price (RMP), replacing the former two-tier gas pricing mechanism which comprises the Regulated Gas Price and LNG Price. For the January-June 2020 period, the average RMP price was RM26.60/ million British thermal units (mmBtu).
TNB said the benchmark fuel prices set for determination of Base Tariff for the same period were US$75/MT for coal and RM27.20/mmbtu for gas.
“The ICPT is a mechanism approved by the government and implemented by the Energy Commission since Jan 1, 2014 as part of a wider regulatory reform called the Incentive Based Regulation (IBR), which allows TNB to reflect changes in fuel and generation costs in consumer’s electricity tariff every six months.
“This mechanism is implemented according to Section 26 of Electricity Supply (Amendment) Act 2015. TNB also wishes to inform that the impact of the ICPT implementation is neutral on TNB and will not have any effect to its business operations and financial position,” it added.