MALAYSIA ’ S ENERGY LANDSCAPE

Malaysia ’ s energy landscape is a diverse mix of fossil fuels and renewables . The country has traditionally been a fossil fuel producer with significant oil and natural gas reserves . Although it remains a net exporter of gas and oil , its coal imports have been increasing to meet the growing energy demand .

In Malaysia , gas represents ~ 39 per cent of total installed capacity , while coal makes up ~ 34 per cent of total installed capacity . Renewables comprise 23 per cent of the national installed capacity mix , comprising mainly hydroelectric , solar and bioenergy .

On the supply side , natural gas constitutes the most significant portion of the primary energy supply , accounting for 41 per cent of the national total primary energy supply ( TPES ). It is followed by crude oil and petroleum products at 29 per cent and coal at 22 per cent , respectively . Renewables make up seven per cent of TPES .

NET ZERO COMMITMENT

Malaysia is committed to sustainable , lowcarbon development , with a clear vision of reshaping its economic landscape . In line with the Paris Agreement , the nation ’ s latest Nationally Determined Contribution ( NDC ) submission aims for an impressive 45 per cent unconditional reduction in emission intensity by 2030 compared to 2005 . Malaysia has also set its sights on achieving net zero emissions by as early as 2050 .

As part of the National Energy Transition Roadmap ( NETR ) development , the Ministry of Economy is collaborating with the Ministry Of Natural Resources , Environment and Climate Change ( NRECC ) to review and enhance existing renewable energy ( RE ) policies .

This collaboration has led to key decisions , including increasing the target for RE capacity from 40 per cent by 2040 to an impressive 70 per cent by 2050 .

from SELCO cannot be exported to the grid , limiting owners from securing compensation for excess energy generated . However , SELCO users benefit from the shortened installation process as the power system study is not required for system sizes up to 425 kWac .

The NEM programme was introduced to continue to spur the industry . Currently on its third installation , NEM 3.0 offers three different categories to ensure equal opportunities for every sector in contributing towards reducing their carbon footprint . NEM Rakyat for domestic consumers , NEM GoMEn for government buildings , and NEM NOVA for commercial buildings categories were launched in 2021 and have received a favourable response from the public .

The introduction of the LSS auction in 2016 has resulted in the addition of 857 MW or 56 per cent to the total solar PV installed capacity as of the end of 2020 . LSS is designed to support the uptake of utility-scale solar PV systems with 1-100 MW capacities in Malaysia .

The FiT scheme was introduced on December 1 , 2011 , to boost RE uptake by ensuring that Distribution Licensees ( DLs ), such as Tenaga Nasional Berhad ( TNB ), purchase electricity from renewable resources at a special rate for a fixed period . The FiT mechanism was initially available for all the primary RE resources ( biomass , biogas , small hydro , and solar PV ). Due to the rapidly decreasing costs , new mechanisms , such as LSS auctions , NEM and SELCO , have been introduced , replacing the FiT mechanism for solar PV68 .

FUTURE RE PLANNING

As the nation ’ s primary entity responsible for electricity generation , TNB is crucial in ensuring a stable and sustainable energy supply .

In the context of retiring coal plants , TNB is repowering plants set for retirement before 2030 with natural gas and , where feasible , incorporating hydrogen co-firing capabilities . This gradual shift supports a

cleaner energy transition while mitigating risks associated with fuel supply .

Malaysia has also invested in grid infrastructure , including smart grids , to ensure the integration of RE sources into the national grid . This enhancement promotes grid reliability and resilience , enabling more efficient RE utilisation .

In grid modernisation , TNB has actively deployed smart metres at customer premises and implemented Distribution Automation ( DA ) systems in the grid .

In 2022 , TNB exceeded the target by installing over 800,000 smart metres , bringing the total to more than 2.6 million . These smart metres automate the billing process and provide detailed usage information , giving customers greater control over their electricity consumption .

Looking ahead , TNB has allocated a total of RM21 billion between 2022 and 2024 for investment in its Grid of the Future programme , enhancing the readiness and reliability of Malaysia ’ s transmission and distribution network .

RE POTENTIAL IN MALAYSIA

Malaysia ’ s dynamic RE sector presents lucrative opportunities for investors . The investment landscape is favourable with strategic location , state-of-the-art facilities , robust connectivity , and government agency support . The well-established policies and regulatory framework further enhance the industry ’ s appeal .

While Malaysia is making strides in its development , there remains to be untapped potential in the RE sector .

Collaborative international efforts and increased investments are vital to unlocking Malaysia ’ s full potential , contributing to its prosperity and the global pursuit of net zero emissions . – @ Green

The introduction of the LSS auction in 2016 has resulted in the addition of 857 MW or 56 per cent to the total solar PV installed capacity as of the end of 2020 . LSS is designed to support the uptake of utility-scale solar PV systems with 1-100 MW capacities in Malaysia .”

KEY RE PROGRAMMES IN MALAYSIA

Since 2012 , RE development in Peninsular Malaysia and Sabah has been supported through four main programmes : Feed-in Tariff scheme ( FiT ), Large Scale Solar auction ( LSS ), Net Energy Metering ( NEM ) and Self-consumption ( SELCO ).

The SELCO scheme introduced in 2017 is available for solar PV system owners who intend to use the electricity generated for self-consumption . Electricity generated