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New Straits Times
05-08-2025
- Business
- New Straits Times
Water tariff hike to boost infrastructure, offset rising costs
KUALA LUMPUR: The recent water tariff revision offers water operators greater flexibility to improve infrastructure, speed up the replacement of old pipes, and address non-revenue water (NRW) issues. CIMB Securities said the tariff adjustments also helped offset significant increases in electricity costs and other operational expenses faced by water treatment plant (WTP) operators. "For instance, the Negeri Sembilan government has seen the monthly water pumping expenses, especially for commercial and industrial sectors in the state, rising by RM700,000 since July 2024," it said in a note. The research house noted that several states have already detailed their plans for utilising the additional revenue from the revised water tariff structure. It added that the Penang Water Supply Corporation (PBAPP) anticipates generating an additional RM20 million in revenue in the second half of 2026 from the new tariffs, which it plans to reinvest in enhancing Penang's water supply infrastructure. "The projects in the pipeline include the construction of the Mengkuang Park Water Treatment Plant, the new Sg. Kerian WTP, and the construction of a new treated water pipeline from the Macallum area to Bukit Dumbar," it said. CIMB Securities said there is an urgent need to upgrade and rehabilitate ageing water infrastructure, noting that 98 out of 350 WTP nationwide are operating beyond their intended capacity, while another 120 WTP are grappling with operational issues. The firm emphasised that addressing these challenges is vital to securing the long-term sustainability of the country's water services. It also stated that the recent water tariff adjustments mark a significant step forward in enhancing water service quality under Malaysia's Water Sector Transformation Plan 2040 (AIR 2040). "This is crucial to support the country's water demand, which is growing at an average rate of 2 to 6 per cent per annum," it said. CIMB Securities noted that while water tariff increases are a step forward, the sector still needs alternative financing models involving private sector participation. This would help ease the federal government's financial burden in supporting the significant investments needed under the AIR 2040 plan. "For exposure to water-related plays, we reiterate our view that licensed water operators under Suruhanjaya Perkhidmatan Air Negara (SPAN) would be the immediate beneficiaries of the water tariff revisions. "Apart from Ranhill Utilities Bhd, PBA Holdings Bhd is the only other licensed water operator in the country that is listed on Bursa Malaysia. "Pending further updates on the private sector's role in Malaysia's water sector transformation, we maintain Gamuda Bhd as our preferred play for water-related infrastructure construction," it added. The firm said Gamuda is well-placed to win construction contracts valued at RM4 billion under the Ulu Padas and Northern Perak water supply projects. It noted that the Northern Perak scheme will be implemented through a privatisation model with a minimum concession period of 40 years. "As the main WTP contractor for Phase 1 of the Rasau Water Supply Scheme worth nearly RM2 billion, we also expect Gamuda to be in the running for more jobs under the second phase," CIMB Securities said.
The Sun
02-08-2025
- Business
- The Sun
PBAPP expects RM20m boost from tariff revision for water projects
GEORGE TOWN: The upcoming water tariff adjustment is expected to generate an additional RM20 million over six months, enabling Penang Water Supply Corporation (PBAPP) to implement seven key infrastructure projects aimed at resolving long-term water supply challenges. PBAPP chief executive officer Datuk K. Pathmanathan said the projects are part of the Penang Water Contingency Plan 2030, including the RM250 million Taman Mengkuang Water Treatment Plant (WTP), which will supply up to 114 million litres of treated water daily to Seberang Perai Tengah. Also planned is the RM402 million Sungai Kerian WTP to improve supply in Seberang Perai Selatan, along with a RM416 million, 3.9-kilometre pipeline from Macallum to Bukit Dumbar to enhance treated water distribution from the Sungai Dua WTP to the island. A compact WTP will also be installed at Sungai Kerian as a temporary measure until the whole facility is completed by 2028. PBAPP will also upgrade key assets, including main pumps at the Bukit Dumbar Reservoir and Pump Station, and build a new chemical dosing facility at Sungai Dua WTP to improve safety in chemical handling and maintenance. Efforts to reduce non-revenue water (NRW) include water meter replacements, smart meter projects and pipe and valve upgrades. The tariff revision, under the Second Implementation Period (TP2) of the Tariff Setting Mechanism (TSM), involves an average increase of 20 sen per cubic metre. Domestic users with individual meters consuming up to 25m³ monthly will pay RM6.50, up from RM6.20. Non-domestic users will be charged RM1.93 per m³ for usage up to 35m³ and RM2.31 beyond that, with a minimum charge of RM19.30. For domestic bulk meters, the flat rate is RM1.92 per m³ with a minimum of RM19.20, while places of worship and charitable institutions will be charged 67 sen per m³ with a minimum of RM6.70. The rate for shipping is RM8.01 per m³ with an RM80.10 minimum, while data centres will be charged RM5.31 per m³ with a minimum of RM53.10 monthly. - Bernama
New Straits Times
01-08-2025
- Business
- New Straits Times
Penang delays new water tariff until July 2026
GEORGE TOWN: Penang has decided to postpone the implementation of the new water tariff under the Tariff Setting Mechanism (TSM) for the Second Implementation Period (TP2) scheduled from today until July next year. Chief Minister Chow Kon Yeow said the one-year delay was expected to benefit approximately 715,957 consumers across the state. "The decision was made to allow more time for further preparation and adjustments," he said today. Chow said, under the revised tariff, the majority of domestic users in Penang would see a moderate increase in their monthly water bills. Specifically, 79.88 per cent of the 613,660 residential consumers who use up to 35 cubic meters (m³) of water per month will face an increase ranging from RM0.30 to RM2.55. Meanwhile, 95.38 per cent of the 98,155 non-domestic users (businesses) consuming up to 200 m³ of water per month will see their bills rise by between RM3.60 and RM35.70 monthly. "This new tariff structure is expected to generate an additional RM20 million for the Perbadanan Bekalan Air Pulau Pinang (PBAPP) over a six-month period next year. "The additional revenue will be allocated towards ongoing water supply service upgrades, with more details to be announced in the future," he said. This move highlights the government's commitment to improving water supply services while managing the impact on consumers. It was reported that new water tariff rates for Peninsular Malaysia and Labuan had been gazetted, and would come into force today. With the exception of Perak and Labuan, the domestic tariff rates had gone up in all states. It was reported earlier this year that the Penang government planned to delay the implementation of a proposed water tariff revision by at least six months.
The Star
01-08-2025
- Business
- The Star
Penang defers implementation of new water tariffs to July 2026
GEORGE TOWN: Penang will defer the implementation of new water tariffs to July 1, 2026, says Chow Kon Yeow. The second phase of the Tariff Setting Mechanism (TSM), originally scheduled to take effect today (Aug 1), will be withheld until then to ease the impact on consumers, said the Penang Chief Minister in a statement on Friday. The deferment will benefit 715,957 registered water accounts in the state. Under the revised tariffs, 79.88% of the state's 613,660 domestic accounts – those using up to 35 cubic metres of water a month – would have seen their monthly bills increase by between 30 sen and RM2.55. This also meant 95.38% of Penang's 98,155 non-domestic (commercial) accounts – those using up to 200 cubic metres of water a month – would have faced bill increases of between RM3.60 and RM35.70. The Penang Water Supply Corporation (PBAPP) was expected to collect an additional RM20mil in revenue over six months with the new tariffs in force.
New Straits Times
01-08-2025
- Business
- New Straits Times
Penang delays new water tariff until July 2016
GEORGE TOWN: Penang has decided to postpone the implementation of the new water tariff under the Tariff Setting Mechanism (TSM) for the Second Implementation Period (TP2) scheduled from today until July next year. Chief Minister Chow Kon Yeow said the one-year delay was expected to benefit approximately 715,957 consumers across the state. "The decision was made to allow more time for further preparation and adjustments," he said today. Chow said, under the revised tariff, the majority of domestic users in Penang would see a moderate increase in their monthly water bills. Specifically, 79.88 per cent of the 613,660 residential consumers who use up to 35 cubic meters (m³) of water per month will face an increase ranging from RM0.30 to RM2.55. Meanwhile, 95.38 per cent of the 98,155 non-domestic users (businesses) consuming up to 200 m³ of water per month will see their bills rise by between RM3.60 and RM35.70 monthly. "This new tariff structure is expected to generate an additional RM20 million for the Perbadanan Bekalan Air Pulau Pinang (PBAPP) over a six-month period next year. "The additional revenue will be allocated towards ongoing water supply service upgrades, with more details to be announced in the future," he said. This move highlights the government's commitment to improving water supply services while managing the impact on consumers. It was reported that new water tariff rates for Peninsular Malaysia and Labuan had been gazetted, and would come into force today. With the exception of Perak and Labuan, the domestic tariff rates had gone up in all states. It was reported earlier this year that the Penang government planned to delay the implementation of a proposed water tariff revision by at least six months.
