8 million households shielded from electricity surcharges amid global energy crisis

KUALA LUMPUR – About eight million households in Peninsular Malaysia remain protected from additional electricity charges amid the global energy crisis, with the government attributing higher bills for some households to increased consumption and rising fuel prices.

Answering a question to MP Machang, Wan Ahmad Fayhsal Wan Ahmad Kamal, the Energy Transition and Water Transformation Ministry said the exemption from Automatic Fuel Adjustment (AFA), Sales and Service Tax (SST) and retail charges was extended to domestic consumers using up to 800 kilowatt-hours (kWh) of electricity monthly.

The exemption, effective from Sept 1 to Dec 31, 2026, covers households with estimated monthly electricity bills of up to RM328 and benefits approximately 90% of domestic users in Peninsular Malaysia.

The ministry said the measure, announced on September 18, was in line with the Energy Commission’s assurance in April that at least 85% of domestic consumers would remain protected amid the global energy crisis.

“The government understands and is aware of the public’s concerns at present, as people feel burdened by the rising cost of living, including increases in electricity bills.

“These concerns are real, and the government does not take this matter lightly,” it said.

The ministry identified two main factors behind higher electricity bills for some domestic consumers, namely increased electricity consumption due to prolonged hot weather and a sharp rise in global fuel prices.

It said higher ambient temperatures had led to more frequent and prolonged use of high-capacity electrical appliances, particularly air-conditioners, contributing to increased household electricity consumption.

Meanwhile, rising global fuel prices had increased electricity generation costs, causing the AFA mechanism to result in surcharges.

The ministry attributed the fuel price surge to geopolitical tensions in West Asia, particularly security disruptions in the Strait of Hormuz, a critical global energy shipping route.

The strait handles approximately 20% of global crude oil and liquefied natural gas (LNG) trade, as well as serving as a key route for 40% of Malaysia’s fuel supplies.

These developments pushed coal and natural gas prices in the second and third quarters of 2026 significantly above the base prices set under the Incentive-Based Regulation (IBR) framework for the fourth regulatory period, covering 2025 to 2027.

The ministry said the government was continuing to work closely with relevant stakeholders to safeguard domestic energy supply and maintain stability amid volatile global markets.

It added that integrated monitoring and coordination measures were being undertaken to ensure the continuity of electricity supply and prevent disruptions to public welfare and economic activity. - October 14, 2026

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