By Dr Mohd Safar Hasim
Electricity theft has emerged as one of the most pressing challenges for Malaysia’s energy sector. Tenaga Nasional Berhad (TNB), the country’s sole electricity provider, has reported losses of RM5.14 billion between 2020 and 2025, largely due to illegal cryptocurrency mining operations.
Syndicates bypass meters, tamper with connections, and siphon power directly from distribution lines, creating both economic and safety risks.
The implications of these losses are profound. They directly reduce TNB’s profitability, weaken
dividend payouts to shareholders, and raise the spectre of higher tariffs for consumers. In addition, they undermine investor confidence, destabilise the energy grid, and erode public trust in enforcement.
This commentary examines the scale of the problem, its implications, and proposes three solutions:
(1) stronger enforcement units, (2) whistleblower rewards, and (3) tighter laws with heavier fines and prison sentences.
The Scale of the Problem
Between 2020 and 2024, police and TNB investigations uncovered 14,489 premises suspected of illegal crypto mining, yet only 77 investigation papers were opened. This disparity highlights a significant enforcement gap. Syndicates operate with impunity, exploiting weaknesses in monitoring and legal deterrence.
The financial impact is staggering. Losses of RM5.14 billion equate to billions of kilowatt-hours stolen, undermining TNB’s ability to invest in renewable energy, infrastructure upgrades, and consumer subsidies.
Implications of the Losses
1. Lower Profit
Electricity theft directly erodes TNB’s bottom line. With billions lost, the company’s net profit margins are squeezed, leaving less room for reinvestment in modernisation, renewable energy projects, and grid resilience. Lower profits also weaken TNB’s ability to absorb shocks, such as fuel price volatility or global energy disruptions.
2. Lower Dividend
Shareholders have already felt the impact. Dividend payouts, once robust, have been trimmed in recent years. For example, after a strong 2020 payout, subsequent years saw dividends stabilise at lower levels. This reflects the financial strain caused by theft. Investors on Bursa Malaysia are understandably concerned, as reduced dividends diminish the attractiveness of TNB as a long-term investment.
3. Potential Higher Tariff for Consumers
Perhaps the most worrying implication is the potential burden on consumers. If losses continue, TNB may be forced to recover costs through tariff adjustments. This would mean ordinary Malaysians paying more for electricity, effectively subsidising criminal syndicates. Such a move would be deeply unpopular and could erode public trust in both TNB and regulators.
4. Safety Hazards
Illegal mining setups bypass safety mechanisms, increasing the risk of fires, electrocution, and grid instability. These hazards threaten not only the perpetrators but also the surrounding communities.
5. Investor Confidence and Market Stability
Losses of this magnitude raise questions about governance and enforcement. Investors may perceive TNB as vulnerable to systemic risks, leading to volatility in its share price. This undermines Malaysia’s broader energy investment climate.
1. Stronger Enforcement Unit
The first solution lies in strengthening enforcement capacity. Current efforts, though commendable, remain insufficient given the scale of theft.
Key Measures:
* Dedicated Task Force: Establish a specialised enforcement unit within TNB, working in close collaboration with police, cybercrime divisions, and anticorruption agencies.
* Smart Monitoring Expansion: Accelerate deployment of smart meters and Distribution Transformer Meters (DTM) to detect anomalies in real time.
* Data Integration: Create a centralised database of suspected premises, linking property ownership, tenancy records, and electricity usage.
* Rapid Response Protocols: Empower the unit to conduct immediate raids upon detection of irregularities.
Expected Outcomes:
A stronger enforcement unit would close the gap between detection and prosecution. By increasing the number of cases pursued, TNB can send a clear signal that theft will not be tolerated. This would also reassure investors and consumers that the company is actively protecting its assets and the
integrity of the grid.
2. Whistleblower Rewards
The second solution involves mobilising the public through whistleblower incentives. Syndicates often operate in residential or commercial areas where neighbours, landlords, or employees may notice suspicious activity.
Key Measures:
* Reward Scheme: Introduce financial rewards for individuals who provide information
leading to successful prosecution.
* Anonymous Reporting Channels: Establish secure, anonymous platforms for whistleblowers to submit information without fear of exposure.
*Community Engagement: Launch awareness campaigns encouraging landlords and communities to monitor tenants’ electricity usage.
* Protection Framework: Ensure whistleblowers are legally protected from retaliation.
Expected Outcomes:
Whistleblower rewards would expand intelligence gathering beyond TNB’s internal monitoring. By incentivising ordinary citizens to act, syndicates would face greater risk of exposure. This grassroots approach complements enforcement efforts, creating a multilayered defence against theft.
3. Tighter Laws and Higher Fines
The third solution requires strengthening the legal framework. Current penalties under the Electricity Supply Act are insufficient to deter syndicates, given the high value of cryptocurrency.
Key Measures:
- Heavier Fines: Increase fines substantially, ensuring they outweigh the profits from illegal mining.
- Longer Prison Sentences: Introduce mandatory custodial sentences for repeat offenders and syndicate leaders.
- Asset Seizure: Empower authorities to confiscate mining equipment and proceeds of crime.
- Identity Fraud Penalties: Strengthen laws against fraudulent use of property owners’ identities.
- Judicial Training: Provide specialised training for judges and prosecutors to understand the technical aspects of electricity theft.
Expected Outcomes:
Tighter laws and higher fines would create a strong deterrent effect. Syndicates would weigh the risks of imprisonment and asset seizure against potential profits, reducing the attractiveness of illegal mining.
Wider Implications
Implementing these solutions would have broader benefits:
* Economic Stability: Reducing theft would strengthen TNB’s financial position, enabling
reinvestment in infrastructure and renewable energy.
* Investor Confidence: Transparent enforcement and legal reforms would reassure shareholders, stabilising TNB’s share price.
* Consumer Protection: By curbing losses, TNB could avoid passing costs onto consumers through tariff hikes.
* National Security: Stronger enforcement would dismantle syndicates that pose systemic risks to Malaysia’s energy supply.
Electricity theft linked to cryptocurrency mining is not a minor nuisance; it is a systemic threat to Malaysia’s energy sector. TNB’s RM5.14 billion losses between 2020 and 2025 highlight the urgency of decisive action.
The implications are clear: lower profit, lower dividend, and potential higher tariffs for consumers, alongside safety hazards and weakened investor confidence.
A stronger enforcement unit would close the gap between detection and prosecution.
Whistleblower rewards would mobilise communities to expose syndicates. Tighter laws and higher fines would create a powerful deterrent, ensuring that the risks of theft outweigh the rewards.
Together, these measures would protect TNB’s bottom line, stabilise dividends, reassure investors, and shield consumers from tariff hikes. More importantly, they would safeguard Malaysia’s energy security in an era where cryptocurrency mining continues to challenge traditional regulatory frameworks.
The views expressed here are those of the author, a Council Member of the Malaysian Press Institute (MPI)