Over 23.6 million domestic electricity users in Peninsular Malaysia are set to benefit from a new, more progressive electricity tariff schedule, which will take effect from July 1, 2025, to December 31, 2027. Approved by the government and implemented under the Incentive-Based Regulation (IBR) framework, this revision aims to provide fairer rates and encourage energy efficiency.
The Energy Commission (Suruhanjaya Tenaga – ST) announced today that the Fourth Regulatory Period (RP4) tariff revision involves a restructuring of three key components: average base tariff rates, a new tariff schedule, and fuel cost adjustment mechanisms.
Lower Overall Base Tariff and New Structure
The average base tariff has been adjusted to 45.40 sen/kWh, a reduction from the 45.62 sen/kWh approved in December 2024. This adjustment leads to an overall average electricity tariff cost reduction of up to 19% compared to the Third Regulatory Period (RP3).
The new tariff schedule introduces a revised classification of customer categories, now divided into domestic and non-domestic users based on their voltage usage (low, medium, or high voltage). Charges for energy, capacity, network, and retail components will now be set based on their respective costs.
Incentives for Energy Efficiency and Social Welfare
To promote prudent electricity consumption, an Energy Efficiency Incentive (Insentif Cekap Tenaga) will be introduced. Domestic users consuming 1,000 kWh or less per month are not expected to be affected by the new tariff. Additionally, non-domestic low voltage users consuming 200 kWh or less will also benefit from this incentive.
The Time of Use (ToU) scheme has been streamlined and expanded to include a longer off-peak period, now covering entire Saturdays and Sundays, as well as weekdays from 10 PM to 2 PM (Monday to Friday). This aims to encourage more efficient consumption management during off-peak hours, potentially leading to reduced electricity bills for consumers.
The government said it will also ensure social and welfare needs are met by applying specific tariffs for agriculture, water and sewerage services, and rail operators. Providing a 10% rebate for registered institutions of higher learning, schools, charitable homes, and places of worship. And continuing the RM40 Electricity Bill Rebate Programme for eligible hardcore poor households registered under the e-Kasih system.
Dynamic Fuel Cost Adjustment and Detailed Billing
The existing Imbalance Cost Pass-Through (ICPT) mechanism for energy charges will be replaced by a new, more dynamic Automatic Fuel Adjustment (AFA) mechanism. This will allow for automatic adjustments to generation costs based on current market fuel prices and foreign exchange rates, with details to be reported monthly on the Energy Commission’s website.
All users will receive their electricity bills in a new, more detailed itemised format, providing greater transparency. The Energy Commission states that the majority of users are expected to remain unaffected by the new tariff, with efficient energy consumers poised to benefit from greater savings.
Detailed tariff schedules will be published from June 21, 2025, at 12:00 noon. An electricity tariff calculator will also be available on the same website from July 2025 (earliest by June 23, 2025) to help users estimate their future bills.
For further enquiries, users are encouraged to contact TNB CareLine at 1-300-88-5454, email [email protected], or reach out through other official TNB platforms.
The Energy Commission has emphasised its commitment to ensuring that tariff implementation is guided by principles of fairness, transparency, and sustainability, aiming to balance the interests of all energy consumers and support Malaysia’s national energy transition agenda.
