@ green | SEPTEMBER-OCTOBER . 2023

Establishing a forward-looking and competitive energy sector has extensive positive cascading effects on the national economy

BY R . PUVANESWARI

Development Goals ( MDGs ) to the Sustainable Development Goals ( SDGs ) hasn ’ t altered the core objective : to attain enduring , robust , and comprehensive development .

The energy realm has consistently stood as a pivotal driver of economic progress on a national scale . Throughout the years , it has made substantial contributions to Malaysia ’ s Gross Domestic Product ( GDP ), generating skilled employment opportunities , playing an essential role in global trade , and fundamentally serving as a significant revenue stream for the country .

Anticipating the future , the energy sector will maintain its pivotal position in Malaysia ’ s upcoming economy , owing to its high-value nature , foundation in innovation , technology , and human expertise .

Establishing a forward-looking and competitive energy sector has extensive positive cascading effects on the national economy . It stems from its crucial role as a primary facilitator and propelling force for production across numerous critical sectors of the nation ’ s economy .

Looking at the current energy landscape in Malaysia , we are currently relying heavily on coal and gas for power generation , which accounts for more than 89.3 per cent of its energy mix , as shown in Figure 1 :

This poses a significant challenge to the country ’ s energy transition , as fossil-based has been a traditional and widely used energy source due to its abundance and cost-effectiveness . The high percentage of coal in Malaysia ’ s energy mix could contribute to air pollution and greenhouse gas ( GHG ) emissions , impacting local air quality and global climate change .

In 2022 , The National Energy Policy 2022-2040 ( DTN ) strategically maps the path ahead and highlights primary focal points for the energy domain in the forthcoming years . The DTN aims to establish the energy sector as a prime driver of socioeconomic progress .

Additionally , the DTN ’ s forward-looking vision of becoming a Low-Carbon Nation will enable the energy sector to leverage opportunities stemming from the ongoing energy transition fully and ensure its resilience and strategic readiness to tackle future hurdles .

The expansion of the energy sector propels advancements in numerous related industries , generating positive cascading effects through job creation , increased capital inflow , and heightened investments . However , the energy sector has also been the most significant contributor to GHG emissions , as shown in Figure 2 .

In 2019 , emissions from the energy sector totalled 259,326.11 gigagrams of CO2 equivalent , constituting 78.5 per cent of the overall emissions . Following this ,

industrial processes and product use ( IPPU ) accounted for 10 per cent , while waste and agriculture contributed nine per cent and three per cent , respectively . The 4th Edition of the Biennial Update Report ( BUR4 ) also documented climate mitigation efforts in the energy sector .

These measures encompassed the adoption of energy-efficient practices , the utilisation of energy-efficient vehicles , the integration of renewable energy sources ( RE ), and the substitution of coal with biodiesel and natural gas in power generation , among others .

Throughout the years , a range of existing energy-related Acts and policies set the direction and guiding principles for the energy sector in Malaysia . These Acts and policies have enabled the country to make balanced progress along all aspects of the energy trilemma . The Acts are supported by a series of policies shown in Figure 3 and provide specific stakeholders within the energy landscape with the relevant authority to carry out responsibilities in alignment with energy-related Acts and Policies .

While the DTN lays the groundwork for transforming the energy landscape , the National Energy Transition Roadmap ( NETR ) is developed to support the DTN as well as the nation ’ s aspiration towards achieving a net zero energy system by 2050 as outlined in the Twelfth Malaysia

Plan , 2021-2025 .

The NETR is a comprehensive plan launched by the Malaysian government in July 2023 , which signifies Malaysia ’ s commitment to transitioning towards a more sustainable and low-carbon energy future . By setting clear targets and implementing strategic initiatives , the government aims to reduce greenhouse gas emissions , increase the share of renewable energy in the national energy mix , and drive economic growth by developing green energy capabilities .

The NETR is underpinned by four principles : aligning the energy sector with the country ’ s aspirations and commitments to sustainable development , ensuring energy security , promoting economic growth , and enhancing social well-being . The NETR sets the direction of the Malaysian government in developing future capabilities and shaping demand in the green energy market .

In reference to the publication titled “ National Energy Transition Roadmap Part 1 : Flagship Catalyst Projects and Initiatives ,” released by the Ministry of Economy in July 2023 , a collection of 10 flagship catalyst projects has been identified . These projects have been selected based on an assessment process and the guiding principles established by the NETR .

The participants involved in these