ADVANCING JUST ENERGY TRANSITION
Malaysia ’ s Sustainable Energy Development Prospectus
Malaysia ’ s Energy Landscape
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MALAYSIA ’ S ENERGY LANDSCAPE has long been dominated by fossil fuels , primarily oil and natural gas , which have accounted for over 95 per cent of the total energy mix . The country ’ s reserves are dispersed across Peninsular Malaysia , Sabah , and Sarawak , with a significant reliance on imported coal for power generation .
Despite historical fuel subsidisation policies , recent reforms aim to strike a fiscal balance . Future plans include replacing aging coal and gas units with additional gas-fired plants , coupled with efforts to expand solar PV capacity . The nation is at a crossroads , contemplating whether to continue on its current trajectory or accelerate its energy transition , considering the volatility in coal and gas prices .
As of 2021 , the country boasts a total installed electricity generation capacity of 33 GW , with coal and natural gas each contributing around one-third . Plans for the next decade involve replacing aging coal and gas units with additional gas-fired plants and a concerted effort to boost solar PV capacity .
In the envisioned low-cost , low-carbon future , Malaysia envisions a shift from fossil fuel dominance to deep electrification across all sectors . This includes scaling up renewable resources like bioenergy , geothermal , and hydrogen . The power sector would witness significant transformation , with scenarios exploring 100 per cent renewable energy or a mix with carbon capture and storage ( CCS ).“
Despite its traditional reliance on fossil fuels , Malaysia recognises the untapped potential of renewable energy . Policies since the 2010s have laid the groundwork for increased capacities , especially in solar PV . The nation aims to surpass the 40 per cent renewable energy target by 2035 , extending beyond electricity generation to encompass the transport and industry sectors .
Aligning with global climate goals , Malaysia ’ s commitment to reducing emission intensity by 45 per cent by 2030 and achieving net-zero emissions earliest by 2050 is outlined in its Nationally Determined Contribution ( NDC ) under the Paris Agreement .
Looking ahead to 2050 , Malaysia anticipates a 60 per cent increase in primary energy supply to 6.7 EJ , driven by a growing population and nearly tripled economy . Energy demand is projected to grow by 1.4 per cent per year until mid-century .
In the envisioned low-cost , lowcarbon future , Malaysia envisions a shift from fossil fuel dominance to deep electrification across all sectors . This includes scaling up renewable resources like bioenergy , geothermal , and hydrogen . The power sector would witness significant transformation , with scenarios exploring 100 per cent renewable energy or a mix with carbon capture and storage ( CCS ).
Current and Future Energy Trends
Between 2010 and 2019 , Malaysia ’ s total primary energy supply increased 3 per cent annually on average , driven by strong economic and industrial growth as well as rapid urbanisation . As of 2019 , Malaysia ’ s primary energy supply was dominated by natural gas ( 42 per cent ), followed by crude oil and petroleum products ( 33.3 per cent ), coal ( 21.4 per cent ), and renewables ( 3.4 per cent ). The share of renewables , primarily hydropower , is expected to grow , reaching around 3.4 per cent by 2050 .