EV Early Adopters May Face 25% Hike In Electric Cost - 99% Malaysian Unaffected!

The Ministry of Natural Resources, Environment, and Climate Change has stated that the government will provide an RM5.2 billion electricity subsidy in Peninsular Malaysia from July 1st to December 31st, 2023. This subsidy is being implemented in tandem with a change in the electricity tariff.

The good news is that the recent power rate adjustment will not affect the vast majority of residential consumers (99%) or non-domestic low voltage consumers. They will keep paying the same prices as previously. Non-domestic high-voltage (HV) and medium-voltage (MV) consumers, as well as the new category of water and sanitation utilities, will see their power prices reduced.

This tariff adjustment is being made due to a modest decrease in the average fuel price, which has dropped from USD 224 per metric tonne (July-December 2022) to USD 173.50 per metric tonne (January-June 2023).

Somehow EV home charging was conveniently omitted from this calculation

To be clear, home consumers who use 1,500 kWh (RM708) or less of electricity per month will not see their electricity bill increase. This category accounts for 99% of Peninsular Malaysia's domestic consumers.

Domestic users with high levels of electricity consumption, surpassing 1,500 kWh or equivalent to a minimum monthly electricity bill of RM708, would face a 10 sen/kWh surcharge. For the time being, this segment consists of around 83,000 household consumers (1%) who utilise a substantial quantity of electricity. They would see a minimum monthly rise of RM187 as a result of a 25% increase in their electricity costs. However, because the ICPT surcharge is not totally eliminated for them, they would still receive a special subsidy of RM58 million.

Now the reason we highlighted the point for the time being is solely based on the push towards electrified mobility adoption in the consumer segment. Consumers are now enjoying a home electricity usage of RM0.571 per kWh, however with the increment they would be forking out RM0.671 per kWh. With EV home charging numbers growing given the increment in EV sales the announced 1% is a number which would grow significantly over time.

Having said that, the RM0.671 per kWh pricing is still lower than the RM0.90 per kWh rate charged at public chargers. However, with the government pushing for EV adoption towards a zero-carbon future, why are EV owners who have already paid a premium for these cars as early adopters penalised further with a higher electricity bill while petrol prices are still heavily subsidised? Is the government REALLY pushing towards electrification or is it merely just playing safe to please all quarters? Something to ponder.