Malaysia's Green Energy Path

Malaysia's Green Energy Path

Malaysia was a leading negotiator for the group of developing nations at the
21st session of the Conference of the Parties to the UN Framework Convention
on Climate Change (COP 21) in Paris. Seven years ago at the COP 15 meeting
in Copenhagen Malaysia had agreed to reduce its "carbon intensity" (CO2eq
emissions to GDP) by 40% from its 2005 value by 2020. Its commitment was
enhanced to 45% carbon intensity reduction by 2030 at the COP 21 in Paris,
France in 2015, subject to conditions regarding financing assistance and
transfer of technology.

So what has Malaysia done so far, is doing now, and can do in the future to
ensure that it can 'honor' its commitment at COP 21? According to Prof Ir.
G. Lalchand (or Lal as he prefers to be called), Malaysian government
policies for energy, especially electricity, supply have traditionally been
based on "supply-side" considerations. Malaysia plans for adequate energy
supply to to meet the projected energy demand, with enough reserve capacity
to cater for plant breakdowns and other utility emergencies. Most of the
electricity supply (over 90% nationally) still comes from fossil fuels and a
little bit from RE resources like hydro, biomass from oil palm plantations
and biogas from palm oil mills. However, as feedstock for power generation
waste, especially from plantations has now become a valuable commodity and
is too costly to burn for power generation due to its several alternative
uses.

National RE development plans have changed over the last few Malaysia Plans
from year 2000, under the auspices of the Sustainable Energy Development
Authority (SEDA) as shown in Figure 1. SEDA's Renewable Energy (RE)
capacity development, including the Economic Transformation Programme (ETP)
target of about 1.25 GW from PV by 2020, is difficult to achieve with the
present size of the RE Fund based on the RE levy of 1.6% on electricity
bills of the affected consumers. Although SEDA has attempted to promote
overall development of electricity generating capacity from all the
designated RE sources, its efforts have not seen much success, except for
the PV sector. This has been caused partly by some external influences such
as the high cost of biomass feedstock as a commodity with alternative uses,
highly "convoluted approval" processes for small hydro projects, lack of
successful examples of municipal waste to energy conversion projects and
remoteness from the power supply grid of projects to use biogas from Palm
Oil Mill Effluent (POME).

Policies promoting "green energy" really started to take root in Malaysia
from 2006 when the National Bio-fuel policy was formulated to encourage the
use of bio-diesel (mixed with mineral diesel) for the transport sector. This
was followed by the formulation of the National Green Technology Policy in
2009 and the Renewable Energy Policy and Action Plan (REPAP) which led to
the enactment of the RE Act in 2011 to develop RE powered electricity
generation for supply to the national electricity supply network.

Numerous other initiatives in this arena include the following:

Energy efficiency awards for different categories of the larger consumers
(early 1990s),
Japanese and French government projects to conduct and inculcate energy
audit practices and programs (mid 1990s),
Feasibility study for an Energy Efficiency policy (by Danish consultants in
1999/2000),
Malaysian Industrial Energy Efficiency Improvement Project (MIEEIP, a
UNDP/GEF project from 1999 to 2007),
Capacity Building in EE (Danish consultants from 2002 to 2005), which
started the appliance EE labeling scheme for refrigerators and electric
motors.
All these initiatives had varying degrees of success during the periods that
the foreign consultants executed the programs, usually as joint-ventures
with local consultants (as partners and "under-studys"). Unfortunately there
was little or no follow-up to continue with those initiatives after the
projects ended. In addition, the "EE equipment rebate scheme" mentioned in
the list above was the SAVE (Sustainability Achieved Via Energy Efficiency)
program, which was a part of EPP-9 (Oil, Gas and Energy Lab) of the Economic
Transformation Program (ETP) to catalyze EE adoption via purchase of EE
appliances such as five-star refrigerators and EE air-conditioners. This
program was an unmitigated success as its end result achievements went well
beyond its planned targets. Sadly, it was not continued after its "one-off"
implementation.

Prof. Lal laments that one of the most promising government initiatives on
EE by the Ministry of Energy, Green Technology and Water ( the acronym in
Malay is KeTTHA), the National Energy Efficiency Master Plan (NEEMP) that
was formulated from mid 2008 to 2010 has not been "allowed to see the light
of day". The Plan was peer-reviewed by an Asia Pacific Economic Cooperation
(APEC) team of industry experts at the end of 2010, and was basically
endorsed as good policy, but the Malaysian government has not implemented
it. Prof. Lal further noted that "KeTTHA had also been formulating an Energy
Efficiency & Conservation (EE&C) Act, which was scheduled to be implemented
by 2014 (as a part of the NEEMP), to enable adoption of EE in Malaysia".
However, KeTTHA later came out with a "watered down" version (as an NEEAP,
i.e. an Action Plan) in January 2014, which removed any reference to the
need for legislation for EE. The "watered down" NEEAP failed to get the
stakeholders' support that KeTTHA sought for it towards the end of the year.

It may be argued that JKR (Public Works Department) has done a lot more in
EE by improving building designs to become more energy efficient. JKR has
also retro-fitted some large government buildings in Putrajaya to achieve
energy savings of up to 14% (about RM2 million to RM2.5 million) a year. In
the private sector, Prof. Lal noted, the Malaysia Association of Energy
Service Companies (MAESCO) is doing retrofits to help companies save energy.
Some of these activities have been conducted under an Energy Performance
Contracting (EPC) concept, where the ESCOs invest in the energy saving
installations for their clients. MAESCO members have been active but their
success is limited because energy is cheap so companies are less keen on
investing to be more energy efficient. Companies are also not getting as
many incentives and EE support the government should be giving as in some
other countries.

The Efficient Management of Electrical Energy Regulations (EMEER) which came
into force in December 2008 require large electricity consumers using more
than an average of 500,000 kWh a month to practice formal energy management.
MAESCO has been approaching them to start saving energy with its energy
performance contracting (EPC) system. It's a form of financing energy
equipment upgrades from cost reductions, as being practiced at the Serdang
Hospital. Prof. Lal notes: "It now remains for us to see whether the
adoption of EE&C initiatives will be implemented effectively and according
to realistic time-lines. We would have to see if the targets and time-lines
set are realistic and to make sure that adequate resources are made
available for effective implementation."

Prof. Lal also strongly supports the need to encourage widespread adoption
of co-generation, as it can be easily and quickly adopted with minimal
public investment. Co-generation can achieve energy conversion efficiency of
up to 85% compared with "only power generation" efficiency of 60% at best.
This issue has been raised by potential consumers (who would also be the
investors) for many years, but the administrative hurdles, which have been
partly "lowered" still remain.

Overall, Malaysia has exemplified considerable alacrity in moving forward
with meeting climate change impact mitigation targets through green
technology and sound energy policy. How far this performance can be
maintained and transferred to other nations in need deserves to be carefully
monitored through international support and connectivity.

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Ref:
http://voices.nationalgeographic.com/2016/09/16/malaysias-green-energy-path/

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com