I

Implementation of Green Technology Policy in Malaysia

1byDatuk Loo Took Gee,
Secretary General,
Ministry of Energy,
Green Technology& Water
7 December
2015
Malaysia(Paris)Content
1. Background;
2. National Green Technology Policy
3. Rationale for Low Carbon Community;
4. Elements & Enablers of Low Carbon Community;
5. Malaysia’s Initiatives Towards Low Carbon Community;
6. Fiscal Incentives as an Enabler for Low Carbon Community;
7. Challenges in Developing Low Carbon Communities; and8. Way Forward.
2(1) Background
MALAYSIA’S PLEDGE TOWARDS GLOBAL GHG EMISSION REDUCTIONEmission Reduction Target
40 % reduction of carbon
intensity per GDP /capita by
2020

3“…Malaysia
isadopting
anindicator of a voluntary reductionof up to 40 per cent in terms ofemissions intensity of GDP (grossdomestic product) by the year
2020 compared to 2005 levels…”

Progress on GHG Emission Reduction

UnitedEmission
Nations Reduction Target
40 % reduction of carbon
ClimateSummit
intensity per GDP /capita by(2014)
2020

IGEM 2015
OpeningCeremony(2015)
4

Malaysia had already reduced
the emissions intensity of its
GDP by more than 33% despite
facing difficulties in fulfilling thepledge made in Copenhagen 6years ago.
“I am pleased to be able toannounce that by the end of2015, Malaysia is projected tohave achieved a reduction inthe greenhouse gas intensity ofGDP of 35 percent.”

(2) National Green Technology Policy
NATIONAL GREEN TECHNOLOGY POLICY
Emission Reduction Target(was launched in July 2009)40 % reduction of carbon

intensity per GDP /capita by2020

Policy Statement
Green Technology shall be adriver to accelerate the national
economy and promotesustainable development

5(2) National Green Technology Policy (cont.)“Green technology is theCRITERIA OF GREEN TECHNOLOGY:
development and application ofo It minimizes the degradation of the environment;
products,equipment
Emission
Reductionand
Targeto It has a zero or low green house gas (GHG) emission;
systems used to conserve theo It is safe for use and promotes healthy and improved
40 % reduction of carbon
naturalenvironment
andenvironment for all forms of life;
intensity
perGDP /capita
resources,whichminimizes
and byo It conserves the use of energy and natural resources;
reduces the negative
impact ofand2020
human activities”
o It promotes the use of renewable resources.

NATIONAL GREEN TECHNOLOGY POLICYENERGY
Seek to attain energy
independence and topromote efficientutilisation
6ENVIRONMENT
Conserve and minimise
the impact onenvironment

ECONOMYEnhance the national
economic development
through the use oftechnology

SOCIAL
Improve the quality oflife for all

(3) Rationale for Low Carbon Community
Global Scenario Current global population is 7 billion and more than
50% of the world population live in cities today; UN estimates 5 billion urban residents (mostly inAsia & Africa) by 2030; and Cities generate >40% global GHG.
Malaysia’s Scenario
 Malaysia’s urban population will rise to 82 percent of
its total population expected 32.4 million in 2020.
(source: World Bank).
7(4) Elements and Enablers for Low Carbon Community

Sustainable
Consumption& Production
Technology
Water &Waste
Management
Elements
Enablers
8

EnergyFinancePublicAwareness

Transport

PolicyInstruments

(5) Malaysia’s Initiatives Towards Low Carbon
Community

9

TRANSFORMING THE
ENERGY SECTOR

10

Economic Indicators (2015)
Population

30.03 million

Area

330,290 sq kmGDP

RM1,070 billion

GDP GrowthPer capita income

Energy Resources (2013)
Oil

5.9 billion barrel

Gas98.315 Trillion
Standard CubicFeet(TSCF)

Coal

1.94 billion metric
tonne

Hydro

20 GW

11

6.0%
RM33,875

Renewable Energy (RE)12

Global Outlook of Renewable Energy► In 2014, the total RE capacity worldwide is 1,829 GW.
► The highest RE source is hydropower. However, it had reduced

from 93% in 2000 to 64 % in 2014 due to the rapid growth in solar
and wind energy.

13

Souce :IRENA Capacity Statistic 2015

Outlook of RE in Malaysia

Background►RE was introduced in the Five Fuel Policy (2000) with a target of 5% of RE inthe energy mix by 2005.
►The initiative will be continued through the 11th Malaysia Plan.
►With the introduction of the National Renewable Energy Policy and Action Plan(2010), the Feed-in Tariff is being implemented for biogas, biomass, mini hydro,
solar PV and geothermal.
Way Forward►Wind and Geothermal mappings are undertaken to identify the potentials ofnew RE sources.
►Net Energy Metering (NEM) and Utility-scale Solar (USS) will be implemented

to boost RE development.
14RE targets in MalaysiaYearCumulative RECapacity

RE Power Mix(vs Peak Demand)

Cumulative
CO2 avoided

2020

2,080 MW11%

42.2 mt2030

4,000 MW17%

145.1 mt15

Achievement of Feed-in Tariff (till 31 October 2015)16

ENERGY EFFICIENCY

17

ENERGY EFFICIENCY POLICY DIRECTIONOBJECTIVE OF ENERGY EFFICIENCY

to ensure productive use of energy and minimize
waste in order to contribute to sustainable
development and increased welfare and national
competitiveness18

National Initiatives in Encouraging EE• Energy efficiency promotion in the Seventh Malaysia Plan
1996-2000

191999• Malaysian Industrial Efficiency Improvement Programme(MIEEP)

2001• Fiscal incentives for EE• Development of Malaysian Standard MS 1525

2002

• Capacity building in the Energy Commission and related key
institutions on energy efficiency and Demand Side Management

National Initiatives in Encouraging (EE)- cont.
•Energy audit on government buildings
2002 •EE and RE in education curriculum and university courses
2006

2008

2009

2013
20

• Development of EE guidelines for Malaysian Industries• Efficient Management Of Electrical Energy Regulations• Green Building Index (GBI)• Minimum Energy Performance Standards (MEPS)

Achievement from the EE initiatives
Estimated annual cost savings from energy
efficient appliances sold under SAVE Rebate is
RM34.4mil and reduction of

158.1GWh of electricity
Electricity usage ingovernment buildings
reduced 6.1% in2014 (compared to2013) and 13.6%
in 2012 (compared to2011)

Contribution ofEE sub-sector toGDP in 2013
was RM 1.5billion

EE products
contributed
RM 6.6 million
revenue to green
business in
2012/ 2013

17% energy saving after retrofittingwith a return on investment of less thansix years at Ministry of Finance,
Malaysia21EE UNDER THE 11th MALAYSIA PLAN (2016-2020)

One of the main game changers pursued under the11th Malaysia Plan is embarking on green growth.

Under this game changer, one of the focus areas thatthe government is emphasising on adopting is thesustainable consumption consumption and production
concept.

22

EE UNDER THE 11th MALAYSIA PLAN (2016-2020)23

EE UNDER THE 11th MALAYSIA PLAN (2016-2020)•Identify potential improvements and appropriate
approaches to ensure efficient use of energy in buildings,industries and households.

•These measures include increasing competencies ofenergy service providers, especially Registered Electrical
Energy Managers, and promoting the implementation ofEnergy Performance Contracting for governmentbuildings.

24

EE INITIATIVES UNDER RMKe-11
Energy Audit And Energy Management in :Large Industrial Buildings
Energy Audit(2016-2018)

Large Commercial Buildings
Energy Audit(2016-2018)

Shared cost of Energy Audit
between Government & Private
Sectors as an incentive forPrivate Sectors to pursue
retrofit program

Energy Audit, Retrofit And Energy Management in :Government Buildings
Energy Audit + Retrofit(2016-2020)25

EE UNDER THE 11th MALAYSIA PLAN (2016-2020)

RMK11-Expanding demand side management measures*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 (e-ToU) withthree 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
26

EE UNDER THE 11th MALAYSIA PLAN (2016-2020)

 Energy

labelling and the availability of standards
such as ISO 50001 for buildings and MEPS forappliances will be promoted.

 Introduction of Enhanced Time of Use (eTOU) tariff

scheme and gradual abolishment of the Special
Industrial Tariff for energy intensive industries.

27

TRANSFORMING THE
BUILDING SECTOR

28

National Initiatives in Greening the Building Sector•Green Building Tools/ Guides in Malaysia
No.

Green Building Tools/ Guides

Description1.

Low Carbon Cities Framework &Assessment System (LCCF)• Launched in 2011by Ministry of Energy,
Green Technology and Water, Malaysia;• Objectives of LCCF are(i) to encourage & promote the concept oflow carbon cities and townships inMalaysia;(ii) to increase the compatibility ofcities/townships with their local naturalsystem;(iii) To
guidecities
inmaking
choice/decisions
towards
greenersolutions.
Achievements (till Nov 2015)-CO2 baseline calculated for 8 sites-Project Briefs completed for 6 sites

29

National Initiatives in Greening the Building Sector•Green Building Tools/ Guides in Malaysia (cont.)
No.

Green Building Tools/Guides

2.

Green Building Index (GBI)

Description• Launched in 2009
• The index is based on criteria which are:(i) energy & water efficiency;(ii) Indoor environmental quality;(iii) Usage of recyclable & environment
friendly material; and(iv) adoption of new technology.
• Achievement (till 15/10/2014):- 334 buildings certified (152 million sqft)- 0.73 MtCO2eq of emission reduction by
GBI certified buildings30

National Initiatives in Greening the Building Sector•Green Building Tools/ Guides in Malaysia (cont.)
No.

Green Building Tools/ Guides

Description

4.

Malaysian Carbon Reductionand Sustainability Tool(MyCREST)• currently being developed to be proposedas the National Green Rating Tool;• tool for sustainable building rating system
which aims at quantifying, reducing built
environment’s impact in terms of carbon
emissions and environmental implication;• Integrating socio-economic considerations
relating to the built environment and urbandevelopment.
• Takes into account a more holistic lifestyleview of the built environment; andDesign31

Construction

Operation &MaintenanceTRANSFORMATION IN THE
TRANSPORT SECTOR

32

National Initiatives in Greening the Transport Sector•Electric Mobility
Positioning Malaysia as the ‘Electric Mobility Marketplace’ inthe region

Key EV markets

08/10/2014

33

Right-hand drive (RHD) markets:Population 1.8 billion (47.9 million new cars registered annually;
Malaysia: 600,000 per annum)
8/10/2014

CONFIDENTIAL

33

National Initiatives in Greening the Transport Sector•Electric Mobility (cont.)
Malaysia’s Targets for Electric Mobility by 2020

100,000 electric cars
100,000 electric motorcycles
2,000 electric buses
125,000 charging stations

EXPECTED OUTCOMES• Reduction of emission by 0.6 mil tonnes CO2• Reduction fuel subsidy cost by 25%, estimated at
RM0.1 bill by 2020
• Enhancement of economic growth: expected
RM328 mil investment by 2020
• Reduction of healthcare cost from better
environmental condition
08/10/2014

35

CONFIDENTIAL

35

National Initiatives in Greening the Transport Sector•Energy Efficient Vehicles
CURRENT SCENARIO (till October 2015)

No. of Hybrid Cars:

43,256

No. of Electric Bikes:

1,144

Revenue from Green
Transportation in2012/2013

RM 2.4 billion
No. of EV Charging
Stations:

4136

36

No. of Electric Cars:

120

National Initiatives in Greening the Transport Sector•Electric Mobility Blueprint
Ministry of Energy, Green Technology & Water isdeveloping the Electric Mobility Blueprint which focuses on
three key areas namely:i.

Electric Mobility in Public Transport - encourages deploymentof electric buses to complement existing LRT and MRT networks,
as well as new BRT routes. The first BRT line in Malaysia hasbegan operating in 2015 using all electric buses;ii.

Electric Mobility Eco System - addresses the charging
infrastructure, backend software, and the issues related to private
ownership of electric cars and electric motorcycles;iii. Electric Mobility Economy
37

SUSTAINABLE CONSUMPTION AND
PRODUCTION

38

National Initiatives towards Sustainable Consumption and Production•MyHIJAU Programme

SustainableConsumption

Sustainableproduction

39

MyHIJAU
Procurement
MyHIJAU
Directory

MyHIJAUMarkMyHIJAU
Industry & SMEs

National Initiatives towards SustainableConsumption and Production(cont.)•Progress of MyHijau Mark Programme
No. of products
received SPAN
Water EfficientLabel Product
SchemeNo. of products
received SIRIM
Ecolabel

490

197
No. of products received
Energy Rating Label
Scheme1,41840

National Initiatives towards Sustainable Consumption and Production(cont.)•International Greentech and Eco Products Exhibition & Conference

A platform to showcase innovative & creative green technology
services, eco-products and initiatives
Description

2010

2011

2012

Total Business
Leads
Reported

RM1.2
billionRM1.6
billionRM1.3
billionYear2013

2014

2015

RM 0.5billion

RM 1.9billion

RM 1.9billion

IGEM 201641

Date: 5-8 October 2016
Venue: Kuala Lumpur Convention Centre

FISCAL INCENTIVES AS AN
ENABLER FOR LOW CARBONCOMMUNITY

42

(6) Fiscal Incentives towards Low Carbon Community•Green Technology Financing Scheme
Total loan amount of RM 3.5 billion for producers(max RM 50 million) and users of green technology (max RM 10 million)
with 2% interest subsidy by the government & 60% government
guarantee

RM2.37 billion has been
disbursed till October 2015

reduction by GTFS projects:

No. of green jobs createdfrom GTFS projects:

2.67 MtCO2e/yr

3,018 jobs

Projection of CO2 emission43

(7) Challenges in Developing Low Carbon Communitiesa) Lack of funding to implement low carbon actions at cities;b) Slow buy-in of the concept of Low Carbon Communityfrom the State and Local Authorities due to lack ofunderstanding and awareness;c) Most cities lack credible GHG Inventory or acomprehensive Blueprint to systematically implement &monitor low-carbon actions; andd) Short of expertise/ skills/ human capacity in areas suchas the low carbon cities concept.
44

(8) Way Forwarda)

Public-Private Partnership to encourage privateorganizations/ city developers to assist local councils
in building low carbon cities;b)

Formulation and implementation of attractive,
innovative incentive schemes and tax-reliefs atmunicipality level;c)Increasing awareness among the stakeholders;d)Encouraging universities/ research Institutes to assist
cities in conducting GHG inventory based on existing
green tools;

45(8) Way Forward(cont.)e)

Mainstreaming green initiatives into the current
development

processes(eg.

government

green

procurement, LCCF etc.); andf)

Encouraging research and commercialization of greentechnology.

46