There is an increasing trend in Malaysia to adopt and use greener and more efficient technology for a more sustainable energy generation to save for the future, better energy efficiency and cleaner environment. This comes in hand with the Government efforts in providing a conducive environment for a sustainable economy.

Renewable Energy

The Government is aiming to increase the generation of renewable energy as part of the energy supply mix for the future. According to the Sustainable Energy Development Authority (SEDA), the target for renewable energy generation should reach 985 MW or 5.5% by 2015 and 2080 MW or 11% by 2020. The Feed-in-tariff (FiT) mechanism has been introduced as one of the measures to achieve this goal where producers are given attractive premium rates to generate renewable energy either from solar, biomass/biogas, or mini hydro sources.

For the period Jan – Dec 2013, a total of 49 projects in renewable energy with total investments of RM1.73 billion were approved incentives. A total of RM1.36 billion were from domestic sources (79%) and RM360.5 million were from foreign sources (21%). These projects are expected to create 969 employment opportunities in this sub-sector. In comparison, for 2012 a total of 33 projects in renewable energy were approved incentives with total investments of RM1.19 billion.

For those investments in renewable energy projects approved with incentives, 37 projects (RM721.5 million) will generate energy from solar sources, 10 projects (RM441.7 million) will use biomass, biogas and combination of both biomass & biogas source, and one mini hydro energy generation project (RM60.4 million). Another one big project with investments of RM506.3 million comes from the only and first ever geothermal project located in Tawau, Sabah with potential capacity of producing 30 MW of electricity

Energy Efficiency

As the price of energy steadily increases and with the Government’s policy of moving away from fuel (energy) subsidies, there is a need to adopt energy efficiency measures to save consumption and expenditure on energy. The Government has been introducing incentives to encourage the use and adoption of energy efficiency systems and technology such as the green building index (GBI) incentives, besides other tax incentives, rebates and import duty and sales tax exemptions. Encouraging energy efficiency activities also opens the door of opportunities for energy services companies (ESCO) to enjoy these incentives by providing such services to potential clients.

For the period Jan – Dec 2013, a total of 16 projects in energy efficiency with total investments of RM31.7 million were approved incentives. Almost all investments totalling RM30.3 million (96%) were from domestic sources and RM1.4 million (4%) were from foreign sources. These investments are expected to provide 210 employment opportunities in the sub-sector. In comparison, for 2012, a total of 17 projects in energy efficiency were approved incentives with total investments of RM1.01 billion. Publicity efforts need to be intensified to make industry players understand and realise the need to adopt energy efficiency measures in order to stay competitive in business.

Projects in energy efficiency approved incentives were mainly hotel services projects with total investments of RM24.5 million comprising 10 projects, mostly involved in changing old inefficient thermal energy equipment to better energy efficiency systems and technology which translate to greater energy savings. The remaining energy efficiency projects approved with incentives were mostly by other companies in manufacturing and other services sub-sectors.

Source: Malaysian Investment Development Authority (MIDA)

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