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 standards and
labelling
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 • Energy Policies and
1 Legislations

• Energy Pricing and

2 Electricity Bills

• Energy Efficiency Standard

3 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-effective
The Supply energy supply through developing and utilizing
Objective alternative sources of energy

• To promote efficient utilization of energy and to

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

The Environment • To minimize the negative environmental impacts of

Objective the energy supply chain

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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.
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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
 Total Bill
Total payable charges as per billing date
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BILLING
Electricity Bill Description

4 Previous Billing Amount & Payment

 Previous Bill
Previous billing information before current bill
 Last Payment
Last payment made
Types of Meter Reading
5 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
Prorated factor: 35/31 = 1.129032
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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

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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
1% additional charge from the total electricity consumption charges
for the billing period. This amount is transferred to Government or SEDA
& no GST applies on it.
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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 consumption at a

6 fluorescent lamps 38 W used for 5 hours
residential premise if the electrical
1 television 100 W used for 4 hours
appliances are used as shown beside.
2 wind fans 60 W used for 4 hours
Based on the tariff given, calculate total
1 refrigerator 700 W used for 24 hours
electricity bill in a month at the
1 iron 1000W used for 30 minutes (0.5 hours)
residential premise which the prorate
1 electrical kettle1000 W used for 15 minutes (0.25 hours)
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 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

Electricity Consumption (kWh) = Power (watts) x Hours of Operation x 30 days ÷ 1000.

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

Answer: 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
Bilangan x power (W) x time Electrical
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 consumption at a

5 fluorescent lamps 70 W used for 7 hours
residential premise if the electrical
1 television 200 W used for 5 hours
appliances are used as shown beside.
4 wind fans 70 W used for 6 hours
Based on the tariff given, calculate total
1 refrigerator 900 W used for 24 hours
electricity bill in a month at the
1 iron 1200W used for 40 minutes (? hours)
residential premise which the prorate
1 electrical kettle 1400 W used for 25 minutes (? hours)
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 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

Electricity Consumption (kWh) = Power (watts) x Hours of Operation x 30 days ÷ 1000.

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5 fluorescent lamps 70 W used for 7 hours TARIFF CATEGORY CURRENT RATE
UNIT
1 television 200 W used for 5 hours (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)
1 electrical kettle 1400 W used for 25 minutes (0.42 hours) 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
Prorate factor = 1.20
For the next 300 kWh (601 - 900 kWh) per month
sen/kWh 54.60
Answer: For the next kWh (901 kWh onwards) per month sen/kWh 57.10
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 efficiently.
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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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