Do you remember the hit song from ABBA?
That song could be adapted for Malaysia's IPPs going from the table of profits.
You can get the full article from the article in malaysiakini:
"MPs query 'extreme profits' for IPPs"
It is good that a BN MP has been able to ask the question but ever so politely.
The Deputy-Minister's reply was not that satisfactory and he justified the subsidy to the IPPs by suggesting that with the subsidy the power rates had been kept low.
"Because of this, the ‘subsidies’ or gas price discounts... actually do not benefit the IPPs but the end-users in the form of low electricity tariffs," said Devamany.
I guess he forgot to mention, or does not realise that TNB is required to buy whatever the IPP supplies and thus the IPP can keep building excess power plants and then TNB is required to buy even if its own plants are running below optimum levels. In other words, there is no cap on the IPP's profits as they have a cheap supply of gas.
YTL Power's profits too may not all come from electricity. I believe a major portion of the profit is from a successful water company in the UK.
To me IPPs should not be the only companies to be placed under the microscope. Water and toll companies should also be tightly scrutinised as they impact directly the costs of living.
Toll companies as they have been kept too secret for so long and water companies as water is Nature's gift and any company that is given the concession should not be allowed obscene profits. Furthermore I feel water companies should be state-owned like what Ranhill Utilities was at the beginning of the IPO about 6 years ago. They had noble intentions but quickly gave way to corporate greed and today not many Johoreans own a share in the company as they did not pay a single sen in dividend for 3 years after the IPO and yet the company made impressive profits.
I don't think plantation companies should be subject to windfall tax as they create wealth through hard work and research development. Perhaps they should be required to provide better facilities for their workers. Some of the smaller companies are quite poor in this respect and that is why only foreign workers take up jobs in estates.
Graphics: thanks to malaysiakini