Wednesday, February 11, 2009

IPPs don't want to review PPAs

Should anyone be surprised by Penjanabebas' stand that the IPPs are against TNB's proposal to the government for review of the Power Purchase Agreements (PPAs)?

Even the surrogate parent for the birth of the IPPs, Dr M has come out to call for a review of the PPAs because the huge power reserves, which means unutilised power, posed a heavy burden to TNB. Needless to say, what's bad for TNB is bad for consumers and the country.

This is the downside to rent-seeking arrangements endemic during the 1980s and 1990s privatisation drive.

My criticism of the IPPs is set out here. In particular, see my arguments here, if you care to.

In the mean time, the news is that with effect from March 1, electricity tariffs for households will be reduced by 2.54%. Commercial rates will be reduced by 2.7% while industrial rates will fall by 5%. I guess beggars can't be choosers in this economic climate.

Be that as it may, I still maintain that the IPPs should be nationalised. 

1 comment:

aash said...

Great writeup on Singapore. I love the place too, especially its local food. Though it can be abit too spicy at times. Thats singapore tourism for you. =)