GEORGE TOWN (April 27): PBA Holdings Bhd expects to reduce its RM91 million domestic water subsidy in Penang, following the impending implementation of the water consumption surcharge (WCS) next year.

Its chief executive officer Datuk Jaseni Maidinsa said the subsidy has been progressively increasing from about RM50 million in 2008.

"Penang is a people-friendly state. However, RM91 million per year (recorded last year) in domestic water subsidies is not sustainable or sensible. By right, this money should be allocated for important water infrastructure projects to avoid water rationing. If we do not do anything now, the subsidy will increase in 2017," he told a press conference.

He noted that some percentage of the subsidy is used as rebates for large households, low income families, registered charitable homes, hostels, hospitals, orphanages, and education centres.

Last month, PBA said the WCS would be raised to RM1 from 48 sen now, after being triggered by 35,000 litres of water consumption by domestic users.

The implementation of WCS is pending approval of the National Water Services Commission (SPAN).

Jaseni said WCS was currently imposed on 25% of 504,400 domestic accounts now, therefore trade consumers would not be affected by the increase.

Domestic consumption is higher than trade usage in Penang, where households utilise 59.4% of treated water here, meaning they use more than factories, hotels and businesses combined.

He reportedly said PBA targets to bring down water consumption by 10%, and that 827 million litres of water was consumed a day in 2016.

At 12.30pm, PBA, a wholly-owned unit of licensed Penang water operator Perbadanan Bekalan Air Pulau Pinang Sdn Bhd, saw share price rise one sen or 0.81% to RM1.25 with 19,000 shares done, valuing the stock at RM413.75 million.