LETTER | The Federation of Malaysian Manufacturers (FMM) welcomes the government’s decision to maintain the Imbalance Cost Pass Through (ICPT) surcharge for 1H2025 at 16 sen/kWh.

The next six months will be crucial as the global market prepares for the policy changes under the Donald Trump administration in the US and geopolitical uncertainties - especially in the Middle East which would continue to pose risks on energy price volatility as the conflict prolongs.

FMM notes that the new base tariff under the Regulatory Period (RP) 4 from 2025 to 2027 would be implemented from July 1, 2025.

We reinforce our view that base tariff review, while addressing the revenue-cost structure mismatch as the country moves towards energy transition and third-party access arrangement, must ensure the industrial tariff rate remains competitive and attractive in the region.

Additionally, the industry should be given time to understand the new tariff schedule that will be introduced. A dialogue with industry stakeholders should be carried out before implementation.

The announcement of the new tariff schedule should also be at least three months before implementation to give sufficient time for the industry to make the necessary adjustments in their operations.

FMM has also requested previously that the SMEs under the medium voltage (MV) category be given due consideration to qualify for a lower surcharge - similar to the rate given to the water services sectors at 3.7 sen/kWh.

The continued high surcharge environment would not be tenable for SMEs to remain competitive in the long run as they would also be making an adjustment for the implementation of the new minimum wage by Feb 1, 2025.

Writer is the president of the Federation of Malaysian Manufacturers.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.