Malaysia has increased the monthly electricity consumption threshold eligible for household subsidies from 600kWh to 800kWh, a move announced by Prime Minister Anwar Ibrahim. This change aims to alleviate the financial burden on households amid increased electricity usage driven by persistent hot weather and haze conditions.
The revised threshold, effective until December 31, allows domestic users consuming up to 800kWh per month to avoid the Automatic Fuel Cost Adjustment (AFA), applicable retail charges, and Sales and Service Tax (SST). This adjustment comes as part of Malaysia’s efforts to ease cost-of-living pressures for its citizens.
Prime Minister Anwar emphasized the government’s commitment to continuously monitor fuel prices and energy market dynamics. The aim is to ensure that electricity tariff policies effectively balance household affordability, supply security, and the long-term sustainability of the energy sector.
The AFA mechanism, which was introduced in July 2025, plays a crucial role in adjusting electricity charges monthly based on fluctuations in fuel prices. This mechanism can result in either rebates or additional charges for consumers, depending on the market conditions.