MALAYSIA ENERGY POLICY

Focusing on Sustainable Energy

Development and The Way Forward
 OUTLINE PRESENTATION

1 CHRONOLOGY OF ENERGY POLICIES IN MALAYSIA

2 CURRENT ENERGY LANDSCAPE

SUSTAINABLE ENERGY
3 ● Supply Side Management
● Demand Side Management

4 KEY CHALLENGES

5 WAY FORWARD

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 ENERGY POLICIES

National Petroleum • Efficient utilization of petroleum resources

Policy (1975) • Ensuring the nation exercises majority control in
the management and operation of the industry

• Supply Objective: Ensure adequate, secure &

cost-effective energy supply

National Energy Policy • Utilization Objective: Promote efficient

(1979) utilization of energy and eliminate wasteful and
non-productive usage

• Environmental Objective : Minimize negative

impacts to the environment

National Depletion • To prolong the life span of the nation’s oil and
Policy (1980) gas reserves

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 ENERGY POLICIES

• Aimed at ensuring reliability and security of

Four-fuel Policy (1981) supply through diversification of fuel (oil, gas,
hydro and coal)

• Encourage the utilization of renewable resources

Five-fuel Policy (2001) such as biomass, solar, mini hydro etc
• Efficient utilization of energy

National Renewable
• To prolong the life span of the nation’s oil and
Energy (RE) Policy + gas reserves
Action Plan (2010)

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 ENERGY EFFICIENCY IS EMBEDDED IN ENERGY POLICY

Petroleum National National National Four-Fuel Five-Fuel

Development Petroleum Energy Depletion Diversification Diversification
Act 1974 Policy 1975 Policy 1979 Policy 1980 Strategy 1981 Strategy 2001

• Vested on • To regulate • To ensure • To prolong • To pursue • Renewable

PETRONAS the downstream adequacy, lifespan of balanced Energy included
exclusive oil & gas security and Malaysia’s oil utilization of oil, as the “fifth
rights to industry via cost- reserves for gas, hydro and fuel” in energy
explore, the Petroleum effectiveness of future coal supply mix
develop and Regulations energy supply security &
produce 1974 stability of oil
• To promote
petroleum supply
efficient
resources of utilization of
Malaysia energy
• To minimize
negative
environmental
impacts in the
energy supply
chain

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NATIONAL GREEN TECHNOLOGY POLICY

POLICY STATEMENT

GreenTechnology shall be a driver to accelerate the national

economy and promote sustainable development

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 MALAYSIA : STATISTICS
As of 2016 INSTALLED PEAK RESERVE
CAPACITY (MW) DEMAND MARGIN
(MW) (%)
Pen. Malaysia 23,249 17,788 28.7%
Sabah 1,567 944.9 37.9%
Sarawak 4,437 3,315 34%

Total installed capacity is 29,253 MW

Electricity penetration: 95%

GDP: 4.5% (Q4-2016)

Electricity penetration: 99.83%

Electricity penetration:
93.7%
Source: KeTTHA Electricity Info Feb 2017

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 Primary Energy vs Energy Consumption
The flow of energy which is represented by the following equation

Primary Energy Consumption

Energy (Gross inland consumption)

Transformation process
Production Final Energy consumption
+ +
Import Consumption of the energy
- transformation sector
Export +
- Distribution losses
Bunkers +
+/- Non - Energy Consumption
Stock Change

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MALAYSIA’s COMMITMENT TO PARIS AGREEMENT 2015

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 GREENHOUSE GAS EMISSIONS

Percentages of Greenhouse Gas Percentage Emissions According To

Emissions by Sector in 2011 Greenhouse Gas in 2011

Source: Biennial Update Report Malaysia 2011

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 11TH MALAYSIA PLAN : ENCOURAGING
SUSTAINABLE ENERGY USE TO SUPPORT GROWTH

S1 Strengthening stakeholder coordination and collaboration in the energy sector

Ensuring the security of supply and reliability for the oil and gas subsector
S2
within a market-based approach

S3 Enabling the growth in the oil and gas subsector

S4 Managing supply diversity for security of electricity subsector

Improving the sustainability, efficiency and reliability of the electricity

S5 subsector

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 STRATEGIC THRUST 4 : PURSUING GREEN GROWTH
FOR SUSTAINABILITY AND RESILIENCE

Source:RMKe-11 Document
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 SUSTAINABLE ENERGY

What Is
"Effectively, the provision of energy such that it
meets the needs of the present without
compromising the ability of future generations
to meet their own needs

Two key components of Sustainable Energy:

Renewable energy and Energy efficiency

Source:https://en.wikipedia.org/wiki/Sustainable_energy
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 WHY IS SUSTAINABLE ENERGY IMPORTANT ?

Environmental Impact

- Reduce emissions of greenhouse gasses and mitigate the impact of global warming.

Sustainable Development
- Reduce dependence on rapidly depleting fossil fuels.

Energy Security
- Ensure the resilience of Malaysia’s energy supply by reducing dependence on imported
sources of fuel

Economic Development
- Tap Malaysia’s tremendous potential and develop a competitive Sustainable Energy
industry

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SUPPLY SIDE MANAGEMENT

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 MALAYSIA : POWER MIX

Source: KeTTHA Electricity Info Feb 2017

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 DEVELOPING THE POTENTIAL OF RENEWABLE ENERGY

2014 vs 2020

Source: RMKe-11 Document

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 LARGE SCALE SOLAR

 LSS is implemented by the Energy

Commission (EC)
 Quota allocation
 1000 MW for 2017-2020 (250 MW/year)
o 800 MW for Peninsular Malaysia
o 200 MW for Sabah

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 NET ENERGY METERING

 FiT for Solar PV to cease post 2017 due to limited RE Fund.

 NEM & LSS introduced to continue development of the

solar PV market.

 Announced by YAB PM during Budget 2016

 SEDA as implementing agency for NEM

 Quota allocation for NEM;

 500 MW for 2016-2020 (100 MW per year)

o 450 MW for Peninsular Malaysia

o 50 MW for Sabah

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DEMAND SIDE MANAGEMENT

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 PROMOTION OF EE BUILDINGS IN MALAYSIA
Low Energy Office - LEO
1  1st showcase model completed in 2004 (GBI-Silver)
 Demonstrate the feasibility of EE design standards as implied
in MS1525 :2001 Code of Practice on EE & Use of RE for Non-
Residential Buildings
 BEI – 100 kWh/m2 annually
 CO2 reduction 56%
Green Energy Office - GEO
 1st certified green building in Malaysia (GBI-Certified)
2
 Demonstrate advance EE and RE design for commercial
building- 2007
 BEI - 65kWh/m2 annually
 Solar Energy - 35kWh generated
 CO2 reduction 86%.
Diamond Building  Improved from both LEO & GEO building experience.
3  Completed in 2010
 Platinum certificate, from Malaysia’s Green Building Index
(GBI) and Singapore’s Green Mark.
 Building Energy Index- 85 kWh/m2 annually
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 EFFICIENT MANAGEMENT OF ELECTRICAL ENERGY
REGULATIONS (EMEER) 2008

 Efficient Management of Electrical Energy Regulations

(EMEER) 2008 has been gazetted on 15th December 2008

 Key Provisions:
• Applied to big energy users 3mil kWh/6months
• Requires appointment of Electrical Energy Manager
• Electrical Energy Management Policy
• Energy audit recommendations for electrical energy
management
• Monitoring &nd keeping of records
• Periodical reporting

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 SAVE
SAVE PROGRAM
PROGRAM ACHIVEMENTS

• Sustainability Achieved via

Energy Efficiency (SAVE)
Programme, 2011-2013
resulted in :

 reduction of domestic
electricity consumption of
306.9 GWh
 savings of RM78.4 million
 Greenhouse Gases (GHGs)
emission reduction of
208,705tCO2eq

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STANDARDS AND LABELLING

 least energy efficient products are

labelled with “2 Star”

 the most efficient products are

labelled “5 Stars”.

 An Endorsement label will be issued

by the Energy Commission

 labels would be affixed on energy

efficient products by the
manufacturers.

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MINIMUM ENERGY PERFORMANCE STANDARD (MEPS)

 Introduced Minimum Energy Performance Standard (MEPS) that will

set minimum energy performance for energy consuming equipment
sold in the market. Currently MEPS has been introduced for 5
domestic electrical appliances :
 Refrigerators
 Air-conditioners
 Televisions
 Fans
 Lightings (Fluorescent, CFL, LED
and Incandescent)

 gazetted in 2013 resulted in reduced electricity consumption and savings.

MEPS Value 2 Stars

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 ENERGY PERFORMANCE CONTRACTING
SAVE PROGRAM (EPC)
ACHIVEMENTS

 Initiative started in January 2013 to promote EE in government buildings.

 Effective mechanism to implement energy saving measures to promote

energy conservation in government buildings by market mechanism-
private investments

 Urgent requirements to cultivate new strategic industries with active

involvement and investments from private sectors as outlined in
Economic Transformation Program

 Under the EPC concept government buildings are allowed to engage

ESCOs to improve EE

 The cost of investment to implement EE improvement will be provided by

the ESCO, while the owner of government buildings are allowed to pay
the cost of investments by the ESCOs from the savings made

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OVERVIEW OF NATIONAL ENERGY EFFICIENCY
ACTION PLAN (NEEAP)

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 RMK-11 : ENERGY AUDIT CONDITIONAL GRANT
WAY FORWARD :11th MALAYSIA PLAN (2016-2020)

Energy Audit And Energy Management in :

Industrial Buildings
Energy Audit
Shared cost of Energy Audit
(2016-2018)
between Government & Private
Sectors as an incentive for
Commercial Buildings Private Sectors to pursue
Energy Audit retrofit program
(2016-2018)

EPC FINANCING THROUGH EPC FUND BY MDV

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 MALAYSIA’S KEY CHALLENGES
Strong Policy Needed to tackle the challenges…

Transparency

Industry Structure Optimizing Resources

Meeting Demand
Economic Growth Depleting Resources

Governance/Regulatory Price Volatility Energy Security

Demand Management Subsidies

Real Price
Realizing Regional Cooperation

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 RESOLUTION – WAY FORWARD

RENEWABLE ENERGY
 Alternative mechanisms to deploy Renewable Energy capacity is
urgently required through:
 Large Scale Solar PV, Net-Metering
 Other mechanisms RPS, Green certificates?
 New RE Resources
 Wind, Geothermal, OTEC etc

 DEMAND SIDE MANAGEMENT

 Comprehensive Demand Side Management Policy Urgently
Required
 Covering Total Energy Landscape – Electrical, Thermal& Transport
 EPU Undertaking The Effort and taken over by KeTTHA for final
comprehensive Policy
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 WAY FORWARD :11th MALAYSIA PLAN (2016-2020)
RESOLUTION – WAY FORWARD
Buildings
•Achieve 700 Registered Electrical Energy Manager
(REEM)
•Extend Energy Performance Contracting (EPC) to other
government buildings
•All new government buildings to adopt energy
efficient design
•Retrofit 100 government buildings
Industries
•Introduce Enhanced Time of Use (EToU) with three
different time zones
•Abolish Special Industrial Tariff (SIT)
•Install 4 million smart meters
•Increase on-grid co-generation capacity of 100 MW or
more by reviewing utility standby charges

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