Malaysia Renewable Energy Roadmap (MyRER)

By Sustainable Energy Development Authority

(SEDA) Malaysia

About MyRER

In 2021, the Ministry of Natural Resources, Environment and Climate Change (NRECC) set a target to reach 31% of RE share in the national installed capacity mix by 2025. This target supports Malaysia’s global climate commitment is to reduce its economy-wide carbon intensity (against GDP) of 45% in 2030 compared to 2005 level. Realization of the Government’s vision is crucial in supporting the nation to achieve its Nationally Determined Contributions (NDC) targets.

 

The Malaysia Renewable Energy Roadmap (MyRER) is commissioned to support further decarbonization of the electricity sector in Malaysia through the 2035 milestone. This is expected to drive a reduction in GHG emission in the power sector to support Malaysia in meeting its NDC 2030 target of 45% reduction in GHG emission intensity per unit of GDP in 2030 compared to the 2005 level, and further reduction of 60% in 2035.

 

The scope of MyRER includes three workstreams; assessing the baseline installed capacity and RE resources potential, developing technology-specific RE targets and scenarios, and developing a strategic roadmap.

 

The MyRER considers two distinct scenarios for RE development in the nation towards the 2025 Government committed RE target and through to the 2035 milestone:

  • Business as Usual (BAU) scenario considers the implementation of existing policies and programmes without further extension and/ or introduction of new programmes; and
  • New Capacity Target (NCT) scenario aims for higher RE capacity target to align with further decarbonization of electricity sector in Malaysia toward 2035 milestone. This scenario is aligned with the capacity development plan of Planning and Implementation Committee for Electricity Supply and Tariff (JPPPET 2020) for Peninsular Malaysia, JPPPET 2021 inputs for Sabah and current outlook for Sarawak.
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The MyRER formulates strategies to achieve the Government’s committed target of 31% RE share in the national installed capacity mix and to further decarbonize the power generation sector until 2035 by maintaining affordability and system stability. To achieve the stipulated RE targets and aspirations, commitments by policy makers, industry players and strategic partners including financial institutions shall be the determinant in ensuring the successful implementation of this Roadmap. This Roadmap will optimize the socio-economic benefits from the development of RE in Malaysia, whilst positively contributing towards the global climate-change agenda in decarbonizing the power sector for a better future.

The Roadmap aims to strike a balance between environmental targets, preserve affordability and economic benefits, and maintain system stability by mitigating the impact of variable renewable energy (VRE) sources, ultimately enabling the Malaysia power sector to deliver reliable and affordable green power to all.

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Objectives

  • To determine the renewable energy targets in the electricity mix-up to 2035; and
  • To determine strategies required to achieve renewable energy targets

Scope

Malaysia is blessed with abundant RE resources readily exploitable for power generation due to:

  • 1 year-round solar irradiation
  • Agriculture, domestic and industrial waste for bioenergy combustion or gasification
  • River basins for small hydroelectric power
Solar PV (includes ground mounted, rooftop and floating installation)
Bioenergy (includes agriculture, animal and municipal & hazardous waste)
Small hydro (system size up to 100 MW)
Large hydro (system size > 100 MW)
Geothermal
SOLARLARGE HYDROBIOENERGYSMALL HYDROGEOTHERMAL
210GW Ground-mounted3.1GW Peninsular2.3GW Biomass1.7GW Peninsular162MW Peninsular
42GW Rooftop500MW Sabah736MW Biogas0.6GW Sabah67MW Sabah
17GW Floating10GW Sarawak516MW Solid Waste0.2GW Sarawak

The MyRER 2035 considers two distinct scenarios for RE development in the nation toward the 2025 Government target and through to 2035:

Business as Usual (BAU)

Business as Usual (BAU) scenario considers the implementation of existing policies and programmes without further extension and/or introduction of new programmes.

New Capacity Target (NCT)

New Capacity Target scenario aims for much higher RE capacity target to align with further decarbonization of electricity sector in Malaysia toward 2035 milestone. This scenario is aligned with the capacity development plan of Planning and Implementation Committee for Electricity Supply and Tariff (JPPPET 2020) for Malaysia. It represents the official commitment by the Government in achieving the 31% and 40% RE target by 2025 and 2035 respectively.

BAU 2025

NCT 2025

BAU 2035

NCT 2035

Updated as 6 October 2021

Figures inline with JPPET 2020

Source: SEDA; ST; SB Peninsular Malaysia, SB Sabah; SESB; SEB

Strategic Framework

MyRER STRATEGIC FRAMEWORK

The MyRER has been formulated to support Malaysia’s vision to achieve 31% RE share in the national installed capacity mix by 2025. Furthermore, the MyRER designs a pathway to enhance decarbonization of the electricity sector through 2035. The MyRER strategic framework builds upon 4 technology-specific pillars supported by 4 cross-technology enabling initiatives

Vision

Pathway Towards Low Carbon Energy System

Technology Specific Pillars

SOLAR

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Accelerate rooftop PV deployment and rollout large scale solar to create new business models

BIO-ENERGY

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New business models to leverage bio-energy resources

HYDRO

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Leverage full hydro potential

NEW solutions and resources

(POST-2025)
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Explore development and demonstration of new energy technologies

Enabling Initiatives

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  • Leverage future-proofing electricity market for RE opportunities
  • Improve access to financing
  • Shape human capital & infrastructure
  • Increase system flexibility

Key Actions

The Solar energy pillar is built upon existing programmes (i.e; NEM and LSS auctions) but to be complimented with the possibility of introducing new business models.

Key actions up to 2025

Accelerate Net Energy Metering (NEM)

  • Enhancement of existing NEM Programme
  • Accelerate NEM approval procedures
  • Promote awareness of NEM
  • Closing development & operational gap
  • Initiate future NEM Programmes (include Review NEM Tariff, Remove Capacity Limit, Include Virtual Net Metering)
  • Initiate Government Rooftop Tendering Programme

 

New Business Models

  • Enable Corporate PPAs via TPA Framework
  • Explore Avenue for Distributed Generations
  • Enhancement of platform for REC Trading

 

Enhance LSS Auctions

  • Implement LSS Auctions with focus area utilizing hydroelectric basin, water bodies
Key actions up to 2035

Accelerate Net Energy Metering (NEM)

  • NEM Programme by Competitive Retailers
  • Continued implementation of Government Rooftop Tendering Programme

 

New Business Models

  • Large scale adoption of corporate PPAs in line with market reforms

 

Enhance LSS Auctions

  • Auction design to align with evolving technological advances and global best practices

The Bioenergy pillar aims to increase bioenergy capacity by supporting the roll out of biomass, biogas and WTE capacity under the existing FiT via new business models (i.e; auctions and tendering programmes), as well as exploring potential opportunities in bio-CNG and biomass co-firing.

Key actions up to 2025

RE Fund (FiT)

  • Explore feasibility of biomass power plants through clustering of mills, coupled with equity participation by palm oil millers

 

New Business Models

  • Increase resource available for power generation through cross-ministerial effort
  • Conduct feasibility study for grid extension to leverage resource
  • Explore feasibility og NEM for bioenergy
  • Assessment of auction system beyond the FiT mechanism

 

Tender Waste-to-Energy Plant

  • Set up tendering process framework and conduct auction for WTE projects

 

Explore Other Opportunities

  • Explore feasibility of bio-CNG and co-firing of biomass
  • Conduct technology improvement study for bio-energy power generation
Key actions up to 2035

New Business Models

  • Organize auctions outside of FiT for remaining biogas and biomass capacity within identified clusters

 

Tender Waste-to-Energy Plant

  • Continue implementation of WTE plants at all viable sites

 

Explore Other Opportunities

  • Explore the implementation incentive mechanism for bio-CNG co-generation and biomass co-firing, depending on outcome of feasibility studies

The Hydro pillar supports accelerated deployment and operation of hydro generation capacity.

Key actions up to 2025

RE Fund (FiT)

  • Optimize small hydro FiT
  • Facilitate and coordinate discussion with State authorities to expedite approval
  • Coordinate regulatory changes on upstream activities

 

Site identifications & Auctions

  • Conduct a hydro-geological study to identify additional sites beyond current resource potential

 

Auctioning of future capacity

  • Set up and conduct auctions for additional small hydro capacity beyond FiT

 

Large Hydro potentials

  • Explore feasibility for life-extension of retiring hydroelectric facilities to support greater VRE penetration
Key actions up to 2035

RE Fund (FiT)

  • No new FiT quota after RE fund fully allocated

 

Site identifications & Auctions

  • Site study expected to be completed by 2025

 

Auctioning of future capacity

  • Conduct auctions for remaining small hydro potential and sites newly identified in the study

 

Large Hydro potentials

  • Deployment of large hydro will be assessed as part of the national power develooment plan drive by collaboration between regulators, State authorities and utilities

The new technology and solutions pillar support roll-out of new RE resources post 2025, as well as exploring solutions to maintain system stability under high VRE penetration.

Key actions up to 2025

Explore new RE resources

  • Facilitate discussion to explore new RE technologies, resources and solutions for efficient and cost effective RE deployment

 

Roll-out of new solutions to ensure system stability

  • Assess required energy storage to avoid curtailment and ensure system stability
Key actions up to 2035

Explore new RE resources

  • Explore offshore and onshore wind potential and feasibility of wind energy integration

 

Roll-out of new solutions to ensure system stability

  • Adopt cost competitive storage solutions in the short term and explore initiatives to develop new storage technologies (e.g. green hydrogen in the long term)
  • Determine and implement appropriate deployment strategies for storage systems including decentralized and centralized options

There are four Enabling Initiatives supporting the implementation of the action plans for each strategic pillar.

Key actions up to 2035

Future-proofing electricity regulatory and market practices

  • Implement Third Party Access (TPA) framework, Retail Market, REC Market and other measures.
  • Promote retail competition to support customer choice
  • Large scale adoption of new business models and offtake structures enabled by market reform
  • Create liquid and vibrant voluntary REC market, including large hydro assets

 

Green Financing

  • Implement best practices to increase level of financial flows towards accelerating RE deployment in energy transition
  • Enhancement of fiscal and non-fiscal incentives
  • Leverage on Funds-of-Funds (FoF)

 

Public awareness and readiness

  • Human capital development, inculcate RE-centric society, R&D and adoption of 4IR technologies

 

System Flexibility

  • Develop capacity market & balancing market framework for implementation including increasing market integration through interconnections
  • Broad base implementation of DSM, Strengthen grid flexibility via smart grid initiatives & other operational measures to manage increased penetration of VRE
  • Increase market integration and multilateral power trading framework through interconnections

Transition Impacts

Energy transition phase has been identified as one of the main economic recovery post-pandemic.

Socioeconomic

Cumulative Investment
The built up of RE capacity up to 2035 will support over:MYR 53 billion investment
Socio-economic Impact
Job Creations
The transition is expected to support direct and indirect jobs in the RE sector up to 2035 by:46,636 job creations

Carbon Emissions

Download MyRER Full Report

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Report

Acknowledgement

The MyRER document is an outcome of collective efforts by Ministry of Energy Transition and Water Transformation (PETRA), Sustainable Energy Development Authority (SEDA) Malaysia, together with industry stakeholders in formulating strategies to pave direction in realizing national renewable energy aspirations. The MyRER which is funded by Malaysia Electric Supply Industries Trust Account (MESITA) Fund, aims to catalyse the development of RE in Malaysia with the ultimate goal of delivering reliable green power to all.

 

PETRA and SEDA wish to thank the following organisations for their valuable contributions and inputs in completing this roadmap: the Economic Planning Unit (EPU), the Ministry of Plantation Industries and Commodities (MPIC), the Ministry of Housing and Local Government (MHLG), the Ministry of Utilities (MoU) Sarawak, State governments – Unit Perancang Ekonomi Negeri (UPEN), Suruhanjaya Tenaga (ST), Securities Commission (SC), Malaysian Investment Development Authority (MIDA), National Solid Waste Management Department (NSWMD), Malaysian Palm Oil Board (MPOB), Tenaga Nasional Berhad (TNB), Single Buyer (SB) of Peninsular Malaysia and Sabah, Grid System Operator (GSO), Sabah Electricity Sdn Bhd (SESB), Sarawak Energy Berhad (SEB), Malaysian Photovoltaic Industry Association (MPIA), Malaysia Small Hydro Industry Association (MASHIA), Malaysia Biomass Industries Confederation (MBIC), Biogas Association Malaysia, Malaysian Gas Association, RE industry players, and financial institutions.

 

PETRA and SEDA would also like to thank the experts from the Asian Development Bank (ADB) and the International Renewable Energy Agency (IRENA) for their peer reviews.

Enquiry & Contact

SUSTAINABLE ENERGY DEVELOPMENT AUTHORITY ( SEDA ) MALAYSIA

Galeria PjH, Aras 9, Jalan P4W,
Persiaran Perdana, Presint 4,
62100 Putrajaya,
Malaysia.
Tel : +603 8870 5800
Fax : +603 8870 5900

Email : [email protected]
[email protected]