his culture of devide and rule plus all the mega projects to cronies ensured we the rakyats will be left with nothing !!

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Only after 4th June when the subsidy was taken away, we complaint about the hardships i.e. no more overseas trips, cheap electricity, cheap water, etc. What I don’t understand is we can drive or travel in Europe where the cost is high but we never think that the global impact is going to hit home. Even in Singapore the cost of living there is high and yet not one of us bat an eyelid.

At the end of it, you have punished the govt through political tsunami. Let the new elected govt delivers their promises. Let them show that they can do much better than BN or UMNO or whomever the ruling party is. I want to know for each RM1 taxes that I pay how is PKR is going to do better?

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I refer to your article above and allow me to quote “Look how much has been wasted and squandered over the years. Think of all the natural gas subsidies dished out by Petronas to the Independent Power Producers (private electricity companies), which have been raking in billions in profits over the years.”

Your claim that Petronas subsidises IPPs is incorrect and this is based on legal facts (PPAs) and therefore verifiable. For your information, electricity tariff comprises of the following components:

(a) Cost of fuel which is gas.
(b) Cost of the planting up of power plants which runs into billion of ringgit forked out by IPPs including TNB
(c) Cost of maintenance of the plant during the operating period.

Note that the fuel cost component has a “pass-through mechanism” from PETRONAS-to-IPPs-to-TNB and eventually to the end users. With this pass-through mechanism, whatever the price of gas Petronas “sells” to IPPs, the IPPs do not derive any commercial benefits in it because the IPPs will then “sell” back this fuel cost component (in every unit of electricty) to TNB at at the same price Petronas sold to IPPs. So even if the price of gas is FREE or RM35/mmbtu, the IPPs do not make any money from it. It is not the case where IPPs mark-up or put-in a profit margin on the cost of gas.

However, IPPs under the PPA, are required a to adhere to a certain level of performance output to ensure that the gas is used efficiently and not wasted.

The reasons for the pass-through mechanism are obvious:

a) The electricity industry in Malaysia has only a single seller of fuel (petronas) and single buyer of electricity (tnb).
b) fuel cost accounts approximately 70% of the electricity tariff;
c) the unit price of electricity that IPPs sell to TNB (which is the single buyer) is based on a fixed price over a fixed period of time;
d) no investors and no banks will finance an IPP (whether built by TNB as in the case Janamanjung or the private sector) if the ‘pass-through’ mechanism is not present.

Therefore, the fuel cost component of of producing a unit of electricity is passed through to TNB who then passes it down to the end user via tariff adjustment. If the fuel price reduces, the end users should benefit from it and if the fuel price increases, the end user end up paying a higher tariff.

Therefore, in essence , Petronas (and the Government ) subsidise the power sector (and not TNB or IPPs ) to ensure low electricity tariff. To reiterate, the IPPs derive no commercial benefit from the gas pricing as set by Petronas and the Government.

To strengthen the structural “weaknesses” of the electricity sector, I suggest that the government should consider the following options:

The first option is to liberalise the market and introduce competition among generators (both IPPs and TNB), say, through an electricity pool.

The second option is for the government to buy over all the IPPs and nationalise the whole sector for good.

Until then, I do not see a light in the tunnel.

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MAKE A MOVE YOU HAVE THE BALL ON OUR SIDE. ITS HIGH TIME TO DEMAND WHAT IS LEGALLY FAIR FOR THE SABAHAN MALAYSIANS. I REFUSE TO ACCEPT THAT ALL OF YOU ARE PERFECT SAMPLES OF LIVING ANESTHESIA.WE HAVE THE PARLIAMENT, STAND STRONG AND ASK! UNTIL IT SHALL BE GIVEN.SEEK! AND YOU WILL FIND THE STRENGHT. KNOCK ! AND THE DOOR WILL BE OPEN .

NOW THAT WE KNOW HOW MUCH PETRONAS IS MAKING FROM HOW MUCH PETRONAS IS GIVING US SABAHANS – MAKES US VERY VERY SAD. WE ARE THE WORLD AND STILL WE ARE THE POOREST STATE. NOW THIS IS VERY VERY HUMILIATING TO MOST OF OUR YBS WHO STILL MAINTAIN THAT ZIPPER IN THEIR MOUTH. WHATEVER DIVERSION YOU DO TO MAKE YOU ALL LOOK STARING TO YOUR PEOPLE BUT KEEP YOUR SILENCE ON THIS MATTER YOU ALL ARE WORST THAN A BREATHING PIN HEAD.

SO SAD VERY SAD…..

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Learn to be thrifty, learn to manage your cash flow.
Learn to balance your asset, debt and liquidity.
Learn to networks and earn money every minutes, every hours.

Learn to read, see, hear and think. Learn to make proper judgement.
Whatever people said, whatever angers , whatever they did….
They find ways to hide, to defend with the enormous wealth .

We must find our wealth, build our wealth in the difficult time.
Many stories told repeatedly, will you get confused and tired.

Learn to live in the world , more challenging ahead.

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… Don’t forget also, the Submarines, the space tourist programme, the Russian MIG …

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