A Proposed Model to Determine Public Acceptance on Willingness to Pay Maximum Demand (MD) Charge in Malaysia

Maximum demand (MD) is a peak load contributed by the customer to TNB system at any point in time. MD charge is important to ensure that customers is paying a fair share on the burden that they place on the electric grid. Currently, the MD charge is only being imposed on Commercial and Industrial customers. In order to achieve economic viability, electricity price should be cost-reflective. This means the MD charge should be paid by all electricity customers including the domestic sector. It is the purpose of this study to investigate if the MD charge eventually need to be paid, how willing are the public to pay market reflective energy pricing with an addition of MD charge in their electricity bill. Hence, this study aims to evaluate the relationship between determinants such as understanding of electricity bills, understanding of electricity pricing, awareness on amount electricity consumption, socio-economic.factors and public affordability on, the public willingness to pay for the MD charges using a proposed theoretical framework. For data collection purpose, a questionnaire on 5-point Likert scale will be developed and data will be collected from 50 random respondents from peninsular Malaysia. The study developed ten hypotheses that is used to validate the relationship between willingness to pay MD charge and its determinants Correlation will be analyzed