ENERGY POLICIES

AND
LEGISLATIONS
IN
MALAYSIA

Chapter 1
 CHAPTER 1.0
ENERGY POLICIES AND LEGISLATIONS IN MALAYSIA
Learning Outcome:

1.1 Students should be able to know the energy policies and

legislations use for various sectors

1.2 Students should be able to understand the energy policies and

legislations use for various sectors

1.3 Students should be able to understand the energy pricing and

electricity bills

1.4 Students should be able to apply the understanding of energy

pricing and electricity bills

1.5 Students should be able to understand the energy efficiency

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standards and labelling
 • Energy Policies and
1 Legislations

• Energy Pricing and

2 Electricity Bills

• Energy Efficiency
3 Standard and Labelling

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ENERGY POLICIES
AND
LEGISLATIONS

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ENERGY POLICIES IN
MALAYSIA
Institutional Framework
 Energy Efficiency & Conservation development in Malaysia :

By Government agencies By private sectors

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 NATIONAL ENERGY POLICIES -DTM
• To ensure adequate, secure and cost-
The Supply effective energy supply through
Objective developing and utilizing alternative
sources of energy

• To promote efficient utilization of energy

The Utilization and to discourage wasteful and non-
Objective productive patterns of energy
consumption

The • To minimize the negative environmental

Environment impacts of the energy supply chain
Objective
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ENERGY EFFICIENCY
STANDARD AND
LABELLING

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ENERGY-EFFICIENCY
STANDARDS & LABELLING
 Energy-efficiency standards are procedures and regulations
that prescribe the energy performance of manufactured
products, sometimes prohibiting the sale of products that are
less energy efficient than the minimum standard, often called
Minimum Energy Performance Standards (MEPS).
 Label Energy-efficiency labels are informative labels affixed to
manufactured products to describe the product’s energy
performance (usually in the form of energy use, efficiency, or
energy cost); these labels give consumers the data necessary
to make informed purchases.

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ENERGY EFFICIENCY LABEL
 More Stars More Saving.
 Energy efficiency label was introduced in 2006.
 Energy efficiency label provides information to consumers about
the energy consumption of an electrical appliance.
 Energy rating label shows the estimated energy consumption of
each electrical equipment based on energy efficiency rating
system.
 The star rating system has a minimum of 1 star and a maximum of
5 stars, where 1-star label is the least efficient and 5 stars is the
most efficient.
 Energy efficiency label is issued by the Energy Commission to
manufacturers of electrical appliances who comply with the
standards and requirements of energy performance test for star
rating established by the Energy Commission. 26
This label contains the estimated
total annual energy consumption in
kilowatt-hours of electricity by each
device, based on recognized
laboratory test results.

The information provided will help

the user to choose the most
energy-efficient models when
purchasing appliances

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ENERGY EFFICIENCY LABEL
 Electrical appliance approved by Energy Commission
for Energy Star ratings are :

Domestic Refrigerators.
Domestic Fans.
Television.
Air Conditioners (Single Split Wall Mounted Type).

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BENEFITS USE OF 5-STAR APPLIANCES

 Use of 5-Star appliances will reduce electricity

consumption and electricity bills at home. This will in
turn produce disposable household income or
household disposable income is higher, especially in
the long run that will improve the quality of life.
 Better savings in the long run.
 Reducing carbon footprint from electricity generation.
 Improved quality of life with more efficient
appliances.
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IMPORTANCE OF ENERGY EFFICIENCY
STANDARDS AND LABELLING

 Ensures consumers can make informed decisions and

purchase electrical appliances based on the Energy
Performance (e.g. cost, efficiency, energy use)
 Helps change mind-set of consumers to consider
long-term energy costs
 Creates demand for more efficient models and
reduces proliferation of low efficiency models

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SMALL RENEWABLE ENERGY PROGRAMME (SREP) -ST

 Promotes renewable energy for power generation

 Facilities expeditious implementation of grid
connected renewable energy resource based small
power plant
 21 year licensed, 10 MW max, 11-33 kV
interconnection
 Renewable Electricity Purchase Agreement “willing
seller willing buyer” basis
 Bumiputera share (30% min), foreign partner (30%
max)
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ENERGY EFFICIENCY INCENTIVES

 Energy conservation service provider

 Energy saving/retrenchment program
 EE equipment purchase locally/import

Type of incentives
 Pioneer status 10 years
 Investment tax allowance on initial 5 years Capex (Capital
Expenditure)
 Import duty & sales tax exemption
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RENEWABLE ENERGY
INCENTIVES
 Energy generation from renewable sources
 Import PV solar equipment system
 Purchase solar heating equipment
 EE equipment purchase locally/import

 Type of incentives
 Pioneer status for 10 years
 Investment tax allowance on initial 5 years Capex
 Import duty & sales tax exemption

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ENERGY EFFICIENCY INCENTIVES APPLICATION PROCESS FLOW

Link for guideline in applying energy efficiency incentive

Refer to ST website
Refer to MESTECC website

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MALAYSIA GREEN BUILDING INCENTIVES
Qualifying expenditure to obtain Green Building Index
(GBI) certification
 Tax exemption equals 100% of qualifying expenditure
 Only for GBI certificate obtained between 24-10-09 and 31-
12-14

Purchase of GBI certified property

 Stamp duty exemption on transfer of ownership
 Stamp duty exemption on S&P between 24-10-09 and 31-12-
14
 Exemption only on additional cost incurred

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ENERGY PRICING
AND ELECTRICITY
BILLS

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THE ELECTRICITY BILL
 Kilowatt-hours (kWh) is the unit of energy used when calculating the cost of
electricity. It is calculated using the equation;

Energy transferred (kilowatt hour, kWh) = Power (kilowatts, kW) x

Time (hours,h)

 Remember a kilowatt is 1000 watts (kilo = 1000)

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TARIFF RATES
 “Domestic Consumer” means a consumer occupying a private dwelling,
which is not used as a hotel, boarding house or used for the purpose of
carrying out any form of business, trade, professional activities or services.
TARIFF CATEGORY CURRENT RATE
UNIT
(1 JAN 2014)
1
Tariff A - Domestic Tariff
.

For the first 200 kWh (1 - 200 kWh) per month sen/kWh 21.80
For the next 100 kWh (201 - 300 kWh) per month sen/kWh 33.40
For the next 300 kWh (301 - 600 kWh) per month sen/kWh 51.60
For the next 300 kWh (601 - 900 kWh) per month sen/kWh 54.60
For the next kWh (901 kWh onwards) per month sen/kWh 57.10
The minimum monthly charge is RM3.00

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BILLING
Electricity Bill Description

1 Bill & Tax Invoice Details

 Account Number
Electricity bill account number
 Contract Number
Electricity supply contract number
 Deposit
The estimated total electricity month
 Electricity Bill & Tax Invoice
The words “Tax Invoice” is clearly
 Tax Invoice Number
Tax invoice serial number

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BILLING
Electricity Bill Description
2 Customer’s Details
Customer’s name and address
3 Current Billing Amount & Payment
 Amount Payable
Total outstanding and current charges as per billing
date
 Bill & Tax Invoice Date
Shows when the bill is generated
 Due Date
The latest expected date for bill payment
 Rounding Up
The policy of rounding up amount is determined by
the Government
 Outstanding Charges
Previous month outstanding charges to be settled
immediately. Kindly ignore if payment has been
made
 Current Charges
Total charges on electricity consumption as per item
7, including credit/debit adjustment, late payment
surcharge and additional deposit 61
 Total Bill
BILLING
Electricity Bill Description

4 Previous Billing Amount & Payment

 Previous Bill
Previous billing information before current
bill
 Last Payment
Last payment made
5 Types of Meter Reading
 Actual Reading
Reading taken at customer’s premises
 Estimated Reading
Reading not taken due to inaccessibility to
TNB meter at customer’s premises
 Total Estimate (kWh)
Average of last six months consumption
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BILLING
Electricity Bill Description

6 Billing Period
 Billing Period
Duration between the current and
previous billing dates
 Tariff
Charges on electricity consumed
according to type of activities at the
premises (residential, commercial,
industrial, etc).
 Prorated Factor
Ratio between the billing period and
number of days in the month.
Example:
Billing period: 35 days
Number of days in the month (December): 31
days 63
Prorated factor: 35/31 = 1.129032
BILLING
Electricity Bill Description

7 Current Billing Details

 Tariff Block
Consumption according to blocks as
gazetted in the tariff structure.
Example: Tariff block multiplied by the
prorated factor:
200 x 1.129032 = 226kWh
 Rates
Charged for each prorated block
 Amount
Result of rate multiplied with prorated
block
 Total
Total electricity consumption charges for
the billing period 64
Electricity Bill Description
8 Current Billing Charges
 Description & Quantity
Units (kWh) of electricity consumed and charges (RM) on
the consumption.
 Consumption for the Month
Total electricity consumption charges for the billing period
excluding GST & renewable energy fund
 GST Charged
Total electricity consumption on which GST applies e.g.
above 300 units of electricity and ICPT that applies,
individual streetlight, etc
 No GST Charged
Total electricity consumption which GST is zero-rated (0%)

i.e. the first 300 units of electricity* and the ICPT that
applies
 Current Billing Charges
Total amount payable for the billing period inclusive of GST
and renewable energy fund
 Rate of GST
GST of 6% applied on the portion of consumption where
GST applies and the total amount of GST charged
*Only for billing cycles of 28 days and above
 Total
Total units (kWh) of electricity consumed and total charges
(RM) on the consumption
 Funds for Renewable Energy
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1% additional charge from the total electricity
consumption charges for the billing period. This amount is
BILLING
Electricity Bill Description
9
Meter Readings
 Meter Number
Meter Serial Number of meter
 Previous
Meter reading on previous date
 Current
Meter reading as per current
 Consumption
Total electricity consumed in the billing
period derived from the difference between
the current and previous reading
 Unit
Measurement of electricity in kWh
 Fuel Subsidy by Federal Government
Fuel Subsidy by Federal Government 66
BILLING
Electricity Bill Description

10 TNB’s Details
Supplier’s Address
TNB’s registered company address
GST Registration Number
TNB’s GST Registration Number

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USAGE COST OF ELECTRICAL APPLIANCES AT
HOME
 The electricity consumption cost per household depends on
family size, living habits, number and age of electrical
appliances and hours of usage.
 Customers can calculate the estimated electricity cost for
different appliances using the following:
 Power rating of the electrical appliance and its efficiency
 Number of hours used
 The domestic tariff rate per kilowatt - hour (kWh)
 The electricity bill calculation is based on the current domestic
tariff rate.

Electricity Consumption (kWh) = Power (watts) x Hours of Operation x 30

days ÷ 1000.
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EXAMPLE 1:

Determine total electrical 6 fluorescent lamps 38 W used for 5 hours

consumption at a residential 1 television 100 W used for 4 hours
premise if the electrical 2 wind fans 60 W used for 4 hours
appliances are used as shown 1 refrigerator 700 W used for 24 hours
beside. Based on the tariff given, 1 iron 1000W used for 30 minutes (0.5 hours)
calculate total electricity bill in 1 electrical kettle1000 W used for 15 minutes (0.25
a month at the residential hours)
premise which the prorate
factor is 1.00. TARIFF CATEGORY CURRENT RATE
UNIT
(1 JAN 2014)
1Tariff A - Domestic Tariff
.For the first 200 kWh (1 - 200 kWh) per month sen/kWh 21.80
For the next 100 kWh (201 - 300 kWh) per
sen/kWh 33.40
month
For the next 300 kWh (301 - 600 kWh) per sen/kWh 51.60
month
For the next 300 kWh (601 - 900 kWh) per
sen/kWh 54.60
month
For the next kWh (901 kWh onwards) per month sen/kWh 57.10
The minimum monthly charge is RM3.00

Electricity Consumption (kWh) = Power (watts) x Hours of Operation x 30

days ÷ 1000. 69
6 fluorescent lamps 38 W used for 5 hours TARIFF CATEGORY CURRENT RATE
UNIT
1 television 100 W used for 4 hours (1 JAN 2014)
2 wind fans 60 W used for 4 hours 1Tariff A - Domestic Tariff
.For the first 200 kWh (1 - 200 kWh) per month sen/kWh 21.80
1 refrigerator 700 W used for 24 hours
1 iron 1000 W used for 30 minutes (0.5 hours) For the next 100 kWh (201 - 300 kWh) per
sen/kWh 33.40
1 electrical kettle1000 W used for 15 minutes (0.25 month
hours) For the next 300 kWh (301 - 600 kWh) per sen/kWh 51.60
month
For the next 300 kWh (601 - 900 kWh) per
Answer: month
sen/kWh 54.60

For the next kWh (901 kWh onwards) per

sen/kWh 57.10
Bilangan x power (W) x time Electrical month
operation (h) consumption (Wh) The minimum monthly charge is RM3.00

6 lamps x 38 W x 5h 1140
1 TV x 100 W x 4h 400 Total electrical consumption for 1 month:
2 fans x 60 W x 4h 480
19.57 kWh x 30 days = 587.1 kWh
1 refrigerator x 700 W x 24h 16800
1 iron x 1000 W x 0.5h 500 Total electricity bills:
1 kettle x 1000 W x 0.25h 250 For the next 300 kWh (301 - 600 kWh)
For the first 200 kWh (1 - 200 kWh)
587.1 kWh – 300 kWh = 287.1 kWh
19570 Wh 200 kWh x RM 0.2180
Total electrical consumption 287.1 kWh x RM 0.5160
19.57 kWh RM 43.60
RM 148.14
For the next 100 kWh (201 - 300 kWh)
Total bill is:
100 kWh x RM 0.3340
RM 33.40
RM 43.60 + RM 33.40 + 148.14
RM 225.14
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EXAMPLE 1:

Determine total electrical 5 fluorescent lamps 70 W used for 7 hours

consumption at a residential 1 television 200 W used for 5 hours
premise if the electrical 4 wind fans 70 W used for 6 hours
appliances are used as shown 1 refrigerator 900 W used for 24 hours
beside. Based on the tariff given, 1 iron 1200W used for 40 minutes (? hours)
calculate total electricity bill in 1 electrical kettle 1400 W used for 25 minutes (?
a month at the residential hours)
premise which the prorate
factor is 1.20. TARIFF CATEGORY CURRENT RATE
UNIT
(1 JAN 2014)
1Tariff A - Domestic Tariff
.For the first 200 kWh (1 - 200 kWh) per month sen/kWh 21.80
For the next 100 kWh (201 - 300 kWh) per
sen/kWh 33.40
month
For the next 300 kWh (301 - 600 kWh) per sen/kWh 51.60
month
For the next 300 kWh (601 - 900 kWh) per
sen/kWh 54.60
month
For the next kWh (901 kWh onwards) per month sen/kWh 57.10
The minimum monthly charge is RM3.00

Electricity Consumption (kWh) = Power (watts) x Hours of Operation x 30

days ÷ 1000. 71
5 fluorescent lamps 70 W used for 7 hours TARIFF CATEGORY CURRENT RATE
1 television 200 W used for 5 hours UNIT
(1 JAN 2014)
4 wind fans 70 W used for 6 hours 1Tariff A - Domestic Tariff
1 refrigerator 900 W used for 24 hours .For the first 200 kWh (1 - 200 kWh) per month sen/kWh 21.80
1 iron 1200W used for 40 minutes (0.67 hours)
For the next 100 kWh (201 - 300 kWh) per
1 electrical kettle 1400 W used for 25 minutes (0.42 sen/kWh 33.40
month
hours)
For the next 300 kWh (301 - 600 kWh) per sen/kWh 51.60
month
Prorate factor = 1.20 For the next 300 kWh (601 - 900 kWh) per
sen/kWh 54.60
month
Answer: For the next kWh (901 kWh onwards) per
sen/kWh 57.10
month
Bilangan x power (W) x time Electrical The minimum monthly charge is RM3.00
operation (h) consumption (Wh)
Total electrical consumption for 1 month:
5 lamps x 70 W x 7h 2450 Total electricity bills:

1 TV x 200 W x 5h 1000 Prorate factor = 1.20 28.122 kWh x 30 days = 843.66 kWh
200 kWh x 1.2 = 240 kWh
4 fans x 70 W x 6h 1680 240 kWh x RM 0.218 For the next 300 kWh (301 - 600 kWh)
1 refrigerator x 900 W x 24h 21600 RM 52.32 603.66 kWh – 120 kWh = 483.66 kWh
300 kWh x RM 0.5160
1 iron x 1200 W x 0.67h 804 843.66 kWh – 240 kWh RM 154.80
603.66 kWh
1 kettle x 1400 W x 0.42h 588 For the next 300 kWh (601 – 900 kWh)
28122 Wh For the next 100 kWh (201 - 300 kWh) 483.66 kWh – 300 kWh = 183.66 kWh
Total electrical consumption Prorate factor = 1.20 183.66 kWh x RM0.5460
28.122 kWh 100 kWh x 1.2 = 120 kWh RM 100.28
120 kWh x RM 0.3340
RM 40.08 Total bill is:

RM 52.32 + RM 40.08 + RM154.80 + RM 100.28

RM 347.48
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USAGE COST OF ELECTRICAL APPLIANCES
AT HOME
 Electricity consumption usually increases due to the following reasons:
Additional electrical appliances as family members grow
Electrical loading or size of the appliances
Modern lifestyles tend to use more electrical appliances
Longer usage of appliances
Appliances that can be adjusted at to maximum capacity e.g. air condition,
fan, water heater, etc, result in high load factor.
Replacement of smaller appliances to bigger capacity
Faulty appliances can lead to inefficiencies in the way they run e.g.
refrigerator with faulty thermostat, shortage of refrigerant, or defective
door gasket.
 There are many ways to improve the efficiency of electricity used in home.
 Wise and efficient use of electricity can save money and assist in protecting
the environment.
 Monitoring consumption can help identify where energy can be used more 73
efficiently.
EXAMPLE

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Energy Efficiency Tips

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Energy Efficiency Tips

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FEED-IN TARIFF (FiT)
A feed-in tariff (FiT, standard offer contract) advanced
renewable tariff or renewable energy payments is a policy
mechanism designed to accelerate investment in renewable
energy technologies.
 The FiT is Malaysia’s new mechanism under the Renewable
Policy and Action Plan to catalyse generation of RE, up to 30
MW in size. This mechanism allows electricity produced from
indigenous renewable energy resources to be sold to power
utilities at a fixed premium price for a specific duration.

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FEED-IN TARIFF (FiT)
 The basic concept of feed-in tariff is that the Distribution
Licensee pays the Feed-in Approval Holder a premium tariff for
clean energy that is generated.
 This allows owners to sell their clean energy to the distribution
licensee for a fixed number of years; the duration is dictated
by the type of renewable energy used for power generation.
 The incentive provides a fixed payment from the electricity
supplier for every kilowatt hour (kWh) of electricity generated
and a guaranteed minimum payment for every kWh exported
to the grid.

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 NET ENERGY METERING
(NEM)
Energy produced from the solar PV system installed will be consumed first, and any excess to be
exported and sold to the distribution licensee (such as TNB /SESB ) at the prevailing Displaced
Cost prescribed by the Energy Commission.  

This scheme is applicable to all domestic, commercial and industrial sectors as long as they are
the customers of TNB (Peninsular Malaysia) or SESB (Sabah and FT Labuan).

Net metering is different from the current Feed-in-Tariff (FiT) system since it allows anyone which
can generate electricity to sell it back to the grid rather than having to bid for a Feed-in-Tariff
quota in order to be eligible to sell back electricity to the grid.

Benefits using NEM:

- By generating their own clean energy, consumer will contribute to the reduction of CO2
emission, hence reducing the carbon foot print and mitigating climate change.
- More energy you generate from RE system, the more you save on electricity bills because you
will need to import less from the utility
- If your installed system incorporates with the energy storage system, power is available even
when the grid fails
- User will be able to hedge any future increase in electricity tariff
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 FEED-IN TARIFF (FiT)

Criteria for renewable resource

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