Why the Drive for Renewable Energy?

According to a recent MIDF Research report, carbon emission has become an increasingly important environmental issue for countries around the world. Global carbon emission has grown from as low as ~3.7mt/capita in the 1980s to as high as 4.9mt/capita in recent years. Among the major global economies (and the world’s largest CO2 emitters), China has been one of the key contributors to global CO2 emissions followed by the United States and the EU. CO2 emission growth in the US and EU have been kept in check, but this is not the case for China which has seen its CO2 emission rising quite significantly. India too, has seen a gradual rise in its CO2 emissions.

How has Malaysia fared? Relative to the world, Malaysia’s carbon emission has been growing at a pretty substantial pace. On a per capita basis in fact, Malaysia has outgrown the global average since 1993 – this is partly driven by industrialization.

Where is it coming from? The majority of global CO2 emission is driven by the electricity & heat sector accounting for 31% of total CO2 contribution, followed by the transportation sector (15%) and the manufacturing & construction sectors (12%). Within the electricity & heat sector, energy clearly accounts for the bulk of CO2 emission contribution at 72%. In Malaysia, the electricity and heat sector takes up a much larger portion of CO2 emissions at 54% (vs. global average of 31%). The transport sector in Malaysia meanwhile, contributes some 30% to CO2 emissions in the country.

In Malaysia, the reliance on fossil fuel is much higher with fossil fuel based power accounting for some 96% of the generation mix. Coal accounts for the majority 56% of generation mix followed by gas at 40%.

Malaysia Electricity Production by Source

Malaysia’s CO2 emission per capita is among the highest in ASEAN

Progressing with RE? Malaysia has stepped outside its solar PV “comfort zone” by exploring the potential of onshore wind energy to be included in its energy mix. It also issued the world’s first green Islamic bond to finance sustainable, climate-resilient growth projects. The implementation of several new initiatives on solar PV, such as auction and net metering, has shown significant progress.

Malaysia has pledged to increase RE contribution to 20% of capacity mix by 2025 from 5% currently. Various schemes including FiT, LSS, NEM are all trying to gain traction. Of the RE mix, 66% is solar energy.

More needs to be done to encourage RE development in Malaysia. The eco-system has to be more conducive for more players to be interested. Individual households also could be encouraged into the sector with heavily subsidised roof-top solar panels.

Reference:

“Power”ing Green Initiatives, MIDF Research, 19 March 2019