Electricity consumers can take heart that they will be partly compensated by Tenaga Nasional (TNB) for future outages that result from the power utility's own fault.

Although the mechanism for determining liability and the amount of the rebate that would be offered are not yet known, two important principles have been affirmed by this action of the Ministry of Energy, Water and Communications - that restitution must be made if the public suffers a wrong, and that a national power company owes a duty of care to ensure that it performs its functions as efficiently as possible.

It is not known if TNB has been given a time frame to propose a suitable compensation system, but the minister Datuk Seri Dr Lim Keng Yaik can be expected to impress on it the need for a fairly urgent response.

There is much good that is inherent in such a penalty, as it will encourage efficiency, compensate for losses, satisfy aggrieved consumers and discourage abuse of the utility's monopoly position.

And apart from happier domestic consumers, it will also have a positive influence on business confidence.

The penalty system is already commonly practised in many other areas, often with great success. Consumer credit and trade financing rely greatly on such clauses to ensure repayment discipline.

Public works are completed in double-quick time because delays attract a hefty surcharge. No shows for flights are kept to a minimum because of the hefty cancellation surcharge that is in place. Airlines routinely compensate passengers for luggage lost or flights cancelled, and in efficiency-conscious countries, public transport delays entitle the commuter to a full refund on tickets.

Fast food restaurants ensure speedy delivery, which is the essence of their business concept, by imposing a strict penalty on themselves for failure to meet self-imposed targets.

Indeed, this concept could very easily be extended to many other providers of public goods and services. Local councils can lead the way by refunding rate-payers for delays and shortcomings in their delivery system.

This can include both regular services like garbage collection, drainage maintenance and the upkeep of parks as well as one-off processes like plan approvals for house renovations.

Phone companies and internet service providers can provide credit for service disruptions, and toll road concessionaires can waive or refund payments for traffic congestion.

When the bottom line does the talking, it becomes so much easier to ensure that consumers' satisfaction is the paramount concern. Suddenly, practical solutions to hitherto intractable problems can become amazingly obvious.