Adjustment to natural gas distribution tariff

PETALING JAYA: Gas Malaysia Bhd has been authorised to raise the distribution tariff for natural gas this year.

The sole owner of natural gas distribution system in Peninsular Malaysia said the daily base average tariff has been adjusted by 0.5 sen per gigajoule (GJ) through a rebate.

“Therefore, Gas Malaysia’s allowed average tariff under the incentive-based regulation framework for all types of utilisations is RM1.568 per GJ per day for the period from Jan 1 until Dec 31, 2025,” it said in a filing with Bursa Malaysia.

In comparison, the allowed average tariff for Jan 1 until Dec 31, 2024 was RM1.528 per GJ per day.

The Energy Commission (EC) had explained that in any given year of a regulatory period, a gas transportation facility operator shall “set its regulated tariffs such that it expects to earn no more than the allowed average tariff”.

The allowed average tariff is calculated as an average and does not prohibit the adoption of differential tariffs and tariff structures for different categories of user.

“Gas Malaysia wishes to clarify that the tariff approval is not applicable to the sales of liquefied petroleum gas supplied in gas cylinders or in bulk supply.”

Gas Malaysia also noted that the distribution tariff would continue to contribute positive returns from the regulated segment of the company for the financial year ending Dec 31, 2025.

Via a statement on March 11, the EC said the change in the average gas facility tariff is expected to have minimal impact on gas users. This is because the composition of the gas facility tariff is small compared with the price of the gas molecule.