Malaysia’s renewable energy policies and programs with green aspects
Saad Mekhilef a,n
, Meghdad Barimani a
, Azadeh Safari b
, Zainal Salam c
a Power Electronics and Renewable Energy Research Laboratory (PEARL), Department of Electrical Engineering, University of Malaya, 50603 Kuala Lumpur,
Malaysia
b Department of Electronic Engineering, Macquarie University, 2109 Sydney, NSW, Australia
c Center of Electrical Energy Systems, Faculty of Electrical Engineering, Universiti Teknologi Malaysia, 8130 Johor Bahru, Malaysia
article info
Article history:
Received 2 December 2011
Received in revised form
11 June 2014
Accepted 9 July 2014
Keywords:
Renewable energy
Energy policy
Malaysia
Green prospect
abstract
Malaysia, as a developing country and a member of the Association of Southeast Asian Nations (ASEAN),
is looking into inexhaustible and repeatable alternative energy sources such as solar, wind, mini-hydro
and biomass. The estimated GDP at 2010 is $15,385 per capita and the economic and industrial growth of
the country implies that energy demand is growing very fast. In addition, the growing prices of fossil
fuels, and greenhouse gas (GHG) emissions, make inevitable renewable energy solutions for the country.
Geographically, Malaysia is located in a region of tropical and humid climate which provides easy
access to a variety of renewable energy sources. The government of Malaysia has initiated renewable
energy policies to encourage industries and individuals to employ renewable-energy-powered systems
in power applications. This paper first gives a brief overview of the current status of renewable energy in
Malaysia. Then it provides the energy policies, specifically the renewable energy policies in Malaysia, in
Section 2. The renewable energy programs are reviewed in Section 3. The building energy efficiency
program with green aspect is provided in Section 4. Lastly, the conclusion and forecasts of this paper are
given in Section 5.
& 2014 Elsevier Ltd. All rights reserved.
Contents
1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 498
2. Energy policies in Malaysia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 498
2.1. Renewable energy policy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 498
2.1.1. Five-Fuel Diversification Policy under the 8th and 9th Malaysia Plans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 498
2.1.2. The National Biofuel Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 498
2.1.3. The National Renewable Energy Policy and Action Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 499
3. Renewable energy programs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 500
3.1. The Small Renewable Energy Power (SREP) Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 500
3.2. The UNDP-GEF Biomass Power Generation and Demonstration (BioGen) project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 500
3.2.1. FELDA Besout POME Biogas Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 500
3.2.2. Bandar Baru Serting Biomass Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 501
3.3. The Malaysian Building Integrated Photovoltaic (MBIPV) Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 501
3.4. The Economic Transformation Program (ETP) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 501
3.5. The Feed-in Tariff (FiT) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 501
4. Building an energy efficiency program with green prospects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 501
4.1. The Malaysian Industrial Energy Efficiency Improvement Project (MIEEIP) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 502
4.1.1. Low-Energy Office (LEO) building . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 502
4.1.2. Zero-Energy Office (ZEO) building . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 502
4.2. The green building index (GBI) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 502
5. Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 503
Acknowledgement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 503
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 503
Contents lists available at ScienceDirect
journal homepage: www.elsevier.com/locate/rser
Renewable and Sustainable Energy Reviews
http://dx.doi.org/10.1016/j.rser.2014.07.095
1364-0321/& 2014 Elsevier Ltd. All rights reserved.
n Corresponding author.
Renewable and Sustainable Energy Reviews 40 (2014) 497–504
1. Introduction
Malaysia’s rapid population growth and economic development have increased the energy demand [1]. From 2005 to 2008,
the final energy consumption growth rate was 5.6%. It is expected
that the total energy consumption will increase to 98.7 Mtoe by
2030, which is three times the 2002 level [2–4]. Currently
Malaysia is mostly dependent on fossil fuels such as coal, oil and
natural gas to generate electricity. Predictions state that around
82% of electricity will be generated by fossil fuels in 2015. Crude oil
reserves have been 2.9 billion barrels/day and the estimate of total
crude oil production on 1st January 2010 was 553,960 BPD [5].
Hence, the oil reserves will be finished within 15 years at the
current rate of usage. Statistics released by [5] show that the
proportion of electricity generated by gas will be reduced from
62.9% in 2005 to 51.6% in 2030; however, fossil fuel dependency
for electricity generation is still high. Malaysia’s total coal consumption increased from 88,000 t/annum in 1980 to 15.219
million tonnes/annum in 2009 and its share is predicted to grow
from 27% in 2005 to 37% in 2030 [6–8]. A four-fuel diversification
strategy was introduced in 1981 as an extension of the 1979
National Energy Policy to guarantee the security of energy supply
and a balance between different types of fuels. The Malaysian
Government has initiated several efforts to move to alternative types of energy, specifically renewable energy, to reduce
Malaysia’s over-dependence on fossil fuels and manage the growing demand for energy. Subsequently, the Five-fuel diversification strategy was set up in 2001 to provide 5% of electricity
generation via renewable energy by 2005. The program will
be followed until 2020. To reinforce the policy, fiscal incentives
such as investment tax allowances have been considered in
parallel with different programs to improve the renewable energy
status.
In the 8th Malaysia plan (2001–2005), the aim was to share 5%
of the total energy supply mix from RE sources to cope with the
upward trend of energy demand in the market. Thorough investigations are being undertaken to find new methods to evaluate
the availability of RE and promote the utilisation of renewable
resources to achieve sustainability of energy supply in the long
term. Although several fiscal incentives have been launched by the
Malaysian government, the development of RE is still rather slow.
According to the 10th Malaysia plan, renewable energy has to
increase from o1% (41.5 MW) in 2009 to 5.5% (985 MW) of total
electricity generation by 2010 [9,10]. The cumulative renewable
energy installation capacity in Malaysia is estimated to be 11.5 GW
in 2050, 34% of the power mix [11]. The following are the renewable energy sources in Malaysia:
– Solar: The average daily solar radiation in Malaysia is between
4.21 kW h/m2 and 5.56 kW h/m2 [12]. The BIPV project has been
announced to increase the grid-connected PV system installations up to 850 MW by 2030 (and more than 8000 MW by 2050)
[11].
– Biomass: Currently, biomass is the most viable among the RE
resources in Malaysia [13]. Malaysia has 4000 ha of palm trees
and is the world’s second-largest producer of palm oil. Palm oil
production increased by 17.4% between 2005 and 2009 to reach
17.6 million tonnes. The potential for biomass from Empty fruit
bunches (EFB) is estimated to be 1340 MW by 2030 [11].
– Biogas: The major sources of biogas are Palm Oil Mill Effluent
(POME) and livestock manure. In July 2009, a total capacity of
4.45 MW was under construction and the potential biogas
constructions will produce 410 MW by 2028 [14,15].
– Municipal solid waste (MSW): The total annual solid-waste
production of Malaysia was been 7 million tonnes in 2010,
and the GDP growth rate of the country was 5.5% by 2011
which means a remarkable increase in solid-wastes production.
Malaysia generated 5.5 MW of electricity from MSW in August
2009 and it is expected that, with the policies adopted by the
government, the total installations will rise to 360 MW by 2022
[15].
– Small and mini-hydro: The total hydroelectric capacity of
Malaysia is around 18,500 MW which is about 20% of the total
energy provided by Tenaga Nasional Berhad (TNB) [16,17]. The
total mini-hydro installations in Malaysia were 30.3 MW by
July 2009 and the expected potential by 2020 is 490 MW [18].
– Fuel cells: After solar, fuel cells are considered the cleanest RE
sources with the least environmental issues. The Ministry
of Science, Technology and Innovation (MOSTI) of Malaysia
funded RM34 million (US$ 9.7 million) of research and development (R&D) of fuel-cell technology between 1996 and 2007
[19,20]. In addition, a total RM7 million (US$2 million) was
invested in hydrogen production and storage technologies
between 2002 and 2007.
– Wind energy: Although Malaysia’s wind energy potential is not
as high as Europe’s [21], wind energy is a promising way of
generating electricity using on-shore and off-shore power
systems. There are two wind-turbine units already installed
in Pulau Perhentian, Terengganu and Pulau Layang–layang in
Sabah with a total capacity of 250 kW [22].
– Geothermal power: The Tawau geothermal program is planned
to install a total capacity of 67 MW of geothermal power
systems. Furthermore, RM1.5 million has been allocated in
the 10th Malaysia Plan for research on geothermal power
generation in Sabah [23].
2. Energy policies in Malaysia
Energy policy is defined as “The manner in which a given entity
(often governmental) has decided to address issues of energy
development including energy production, distribution and consumption” [24]. The main goals for setting up RE policies are to
persuade societies and individuals to adopt RE as an alternative
source of energy. Energy policies try to encourage RE in the
country’s energy mix by facilitating technological barriers, addressing market failures and decreasing associated costs. Energy
policies in Malaysia are supervised by the Economic Planning Unit
(EPU) and the Implementation and Coordination Unit (ICU). These
policies are controlled directly by the country’s prime minister.
Various policies have been undertaken by the Malaysian government to ensure sustainable energy in the future. The energy
policies adopted by Malaysia and the main goals of each policy
since 1974 are presented in Table 1.
Table 1 indicates that the National Energy Policy was adopted
in 1979 when the world was experiencing an oil crisis [19].
The main objectives of this policy have been production, utilisation
and environmental issues.
Generally in energy policies, the supply objectives target the
full exploitation of RE sources. Utilisation objectives target energy
conservation and efficiency promotion as well as providing solutions
to eliminate wasteful and non-productive energy applications.
The environmental objectives try to lessen the environmental issues
when taking advantage of energy sources.
A year after introducing the National Energy policy, a new
policy called the National Depletion Policy was launched. The
purpose of the new policy was to conserve the main energy
resources (mainly oil and gas) of the country. Subsequently, in
1981, the Four Fuel Diversification Policy was announced. The
policy emphasises the importance of utilising and diversifying the
usage of the four main resources (oil, gas, coal and hydro).
498 S. Mekhilef et al. / Renewable and Sustainable Energy Reviews 40 (2014) 497–504
2.1. Renewable energy policy
2.1.1. Five-Fuel Diversification Policy under the 8th and 9th Malaysia
Plans
In 2001, greater efforts were made for utilising RE resources.
In the 8th Malaysia plan, a new energy policy called the “Five-Fuel
Diversification Policy” was announced. It was the first time in the
country that RE was targeted to be the major contributor to
generation of electricity. It was urged due to the significant
depletion of oil and gas in that era. Hence, government added RE
as a significant source of energy after oil, gas, coal and hydro [25].
The Five-Fuel Diversification Policy aimed to generate and feed
500 MW of electricity to the national grid; however, at the end of the
plan in 2005, only 12 MW was delivered to the grid under the Small
Renewable Energy Power Program (SREPP) [26]. The development
pace of RE in Malaysia is rather slow and is still in the infant stage.
Although the fifth energy policy was announced a decade ago, the RE
contribution is 1% of the total energy mix [19]. Thereafter, the
government decided to continue the Five-Fuel Diversification Policy
in the 9th Malaysia plan between 2006 and 2010 [27]. During the 9th
Malaysia Plan, 300 MW was generated and fed to the Tenaga Nasional
Berhad (TNB) grid in Peninsular Malaysia plus 50 MW to the Sabah
Electricity Sendirian Berhad (SESB) grid in Sabah [28]. The expectation
was to generate 5% of total electricity from RE by 2005; however, by
the end of the 9th Malaysia Plan, only 41.5 MW was successfully
connected to the grid [29].
2.1.2. The National Biofuel Policy
In spite of the successful development of the first biofuel
production in ASEAN-6, its sustainability has been more and more
Table 1
Energy policies in Malaysia.
Policy name and year Description of energy policy
Petroleum Development Act 1974 Vested the exclusive right to explore, develop and produce petroleum in Malaysia to PETRONAS
National Petroleum Policy 1975 To regulate downstream oil and gas industry via the Petroleum Act
National Energy Policy 1979 Based on three objectives: Supply, Utilisation and Environmental
National Depletion Policy 1980 To prolong lifespan of Malaysia’s oil reserves for the future
Four-Fuel Diversification Strategy 1981 To balance utilization of oil, gas, hydro and coal
Renewable energy Policies Description of Renewable energy Policy
Five-Fuel Diversification Strategy 2001 RE included as fifth fuel in energy supply mix
National Biofuel Policy 2006 Promote the demand for palm oil
National Renewable Energy Policy and Action Plan 2010 Enhance the utilisation of indigenous renewable energy resources
Other related Policies Authorised organiser
Science & Technology Policy, 1986 MOSTI
Environmental Policy, 2002 NRE
Bio-Fuel Policy, 2005 KPPK
Green Technology Policy, 2009 KeTTHA
Climate Change Policy, 2009 NRE
Nomenclatures
ACEM Association of Consulting Engineers Malaysia
ASEAN Association of Southeast Asian Nations
BioGen biomass-based power generation and cogeneration
BIPV building integrated photovoltaic
DanIDA Danish International Development Assistance
EE energy efficiency
EFB empty fruit bunches
EPU Economic Planning Unit
ETP Economic Transformation Program
FiT Feed-in Tariff
GBI green building index
GDP gross domestic product
GEF Global Environmental Facility
GHG greenhouse gases emission
ICU Implementation and Coordination Unit
KeTTHA Ministry of Energy, Green Technology and Water
KPPK National Union of Teaching Malaysia
LEO Low Energy Office
MBIPV Malaysian Building Integrated Photovoltaic
MIEEIP Malaysian Industrial Energy Efficiency Improvement
Project
MOSTI Ministry of Science, Technology and Innovation
MSW municipal solid waste
NKEA National Key Economic Area
NRE natural resources and environment
PAM Pertubuhan Arkitek Malaysia
POME palm oil mill effluent
PPP purchasing power parity
PTM Malaysia Energy Centre
PV photovoltaic
RE renewable energy
RM Ringgit Malaysia
SCORE Special Committee on Renewable Energy
SEDA Sustainable Energy Development Authority of
Malaysia
SESB Sabah Electricity Sendirian Berhad
SREPP Small Renewable Energy Power Program
TNB Tenaga Nasional Berhad
UNDP United Nations Development Program
US United States of America
ZEO Zero Energy Office
Subscripts
$ dollar
BPD barrels per day
CO2 carbon dioxide
GW gigawatt
RM/kW h Malaysian Ringgit per kilowatt hour
m2 square metre
Mtoe million tonnes of oil equivalent
MW megawatt
S. Mekhilef et al. / Renewable and Sustainable Energy Reviews 40 (2014) 497–504 499
questioned. There was increasing criticism of the destruction of
valuable ecosystems like rainforests as well as increased CO2
emissions from the conversion of peat forest into palm-oil plantations. As a result, interest in the potential of so-called advanced
and second-generation biofuels has been raised [30]. The new
fuels could offer a great potential to improve economic conditions
and support rural development. Hence, a National biofuel policy
was launched on 21st March 2006. The primary goals of this policy
were reducing the country’s dependency on fossil fuels, promoting
the demand for palm oil to generate electricity and subsidising the
installation costs [31].
2.1.3. The National Renewable Energy Policy and Action Plan
As part of the 10th Malaysia Plan in 2010, the National Renewable Energy Policy and Action Plan was launched. This policy has
been launched to provide a secure and sustainable national
electricity supply for socio-economic development [12]. The main
goals were:
– Increasing the contribution of RE to the electricity power
generation mix.
– Helping growth of the RE industry.
– Making RE available at reasonable cost.
– Maintaining the environment for future generations.
– Increasing awareness of the public on the importance of RE.
To increase the public awareness, a “Feed-in Tariff” was introduced in the 10th Malaysia plan. According to the 10th Malaysia
plan, a total electricity generation of 985 MW should be achieved
during 2010 to 2015, which is almost 23 times the 41.5 MW of
previously installed capacity [10]. Fig. 1 shows the total RE capacity
in 2009 and the expected capacity in 2015.
3. Renewable energy programs
To support renewable energy policies in Malaysia, several fiscal
and financial programs have been launched by the government.
Table 2 presents the main RE programs approved by the Malaysian
government. The following sections will present these programs.
The other two topics, ETP and FiT, will be discussed as related
programs that were effective in the growth of RE in Malaysia.
3.1. The Small Renewable Energy Power (SREP) Program
Along with the 5th Fuel Policy, SREP Program was introduced
with the 8th Malaysia plan on 11th May 2001. It was to encourage
RE project developers and facilitate the wider use of RE for
generating electricity in Malaysia. Successful sub-programs of
SREP Program include Jana Landfill biogas generation project at
Puchong (shown in Fig. 2), and TSB Bio-energy project at Sabah [2].
In the Jana Landfill biogas generation project two 1000 kW engines
were installed on the Puchong Snitary Landfill, and the generated
power was fed to the public grid. This project won the ASEAN
renewable energy awards in 2005.
Through SREP Program, independent small RE power plants
could sell generated electricity to the grid. This program covered
almost all renewable energy sources such as solar, wind, biomass,
mini-hydro, biogas and MSW. The special Committee on Renewable Energy (SCORE) supervised by the Ministry of Energy, Water
and Communications (currently the Ministry of Energy, Green
Technology and Water) is responsible for the co-ordination and
implementation of this program. The committee has set up a series
of guidelines which explain licences to supply electricity generated
from RE to the grid. These guidelines also indicate that the small
electricity power plant should be at a distance of at least 10 km
from the nearest interconnection point. The preference of this
Fig. 1. RE capacity in 2009 and the expected capacity in 2015.
Table 2
Renewable energy programs.
Program Launched in Goals
Small Renewable Energy Power Program (SREP) 2001 Permission to small RE power producers (o10MW) to sell electricity to utility
UNDP-GEF Biomass Power Generation & Demonstration
(BioGen) project
2002 Promote utilisation of biomass (EFB) & biogas (POME) grid-connected project
in order to reduce the GHG emission
Malaysian Building Integrated Photovoltaic (MBIPV)
Project (UNDP-GEF)
2005 To reduce cost of technology of solar PV and increase total capacity
Fig. 2. Jana Landfill biogas generation project at Puchong.
Source: http://www.jdgroup.com.my/index.php.
500 S. Mekhilef et al. / Renewable and Sustainable Energy Reviews 40 (2014) 497–504
program was for co-generation plants. The maximum capacity of
each small power plant to supply to the grid should be 10 MW.
Table 3 shows the status of SREPP in March 2010 [32].
3.2. The UNDP-GEF Biomass Power Generation and Demonstration
(BioGen) project
Following the SREP Program, a new project was initiated to
develop a high-efficiency RE cogeneration plant for the palm-oil
industry in 2002. The United Nations Development Program
(UNDP) and the Global Environment Facility (GEF) were initiated
to support the UNDP/GEF Biomass Power Generation and Demonstration (BioGen) Project. The project has been supported technologically and financially by government. The project aimed to
reduce emissions (GHG and Methane from biomass decay), and
specifically to use waste residues from palm oil (Empty Fruit
Bunches) to generate electricity, and sell to the public grid [33].
Launching this project was in the line with reducing barriers to
generate biomass electricity and promote growth of power generation. Two small-scale demonstration project activities under
BioGen project are: FELDA Besout POME Biogas Project, and
Bandar Baru Serting Biomass Project.
3.2.1. FELDA Besout POME Biogas Project
The FELDA Besout POME (Palm Oil mill) biogas project involved
the construction and operation of a closed anaerobic pond and a
biogas flaring and combustion plant located in Jengka. This project
has two phases. Phase one aimed to capture and utilize the
methane gas released from anaerobic ponds s in an enclosed type
flare. The excess biogass was used at the second phase to generate
electricity. The electricity generated at phase two was used instead
of the generated electricity by fossil fuels on-site.
The efficiency of the operations in The FELDA Besout POME
biogas project was around 16%, which made it a standalone lowefficiency project. Hence, it can be considered neither as a renewable energy plant nor rural electrification program.
3.2.2. Bandar Baru Serting Biomass Project
The Bandar Baru Serting Biomass Project was a small-scale
demonstration project activity developed by MHES Asia Sdn Bhd
in the Serting Industrial Estates. It was towards the Government
5th fuel policy renewable energy to encourage developing biomass
and biogas facilities to generate electricity using palm oil wastes
(collected from nearby plantations), and deliver 10.5 MW to the
national grid. This project set sustainable developments including
increased local employment opportunities, increases diversity and
security of electricity supply, and reduce fossil fuel consumption.
According to the reports, this project became a standalone low
efficiency tragedy. There are various reasons for project failure
most importantly is approving the standalone project while the
funding was originally allocated to demonstrate a cogeneration
project. Hence, the project was left abandoned after a last drawdown of a government guaranteed loan.
3.3. The Malaysian Building Integrated Photovoltaic (MBIPV) Project
In 2004, GEF together with UNDP approved support for the
development of the Malaysia Building Integrated Photovoltaic
(MBIPV) project [34]. The project was launched for the period of
5 years between 2005 and 2010. It was initiated to encourage the
industry sector and householders to employ PV systems for
producing electricity and reducing GHG emission. The MBIPV has
contributed to the overall energy efficiency in buildings without
sacrificing aesthetics by considering the guidelines known as
MS1525 published in the year 2001. MS1525 was later revised
and updated in 2006. It represents an attempt to achieve efficient
use of energy in non-residential buildings [35]. The SURIA1000
project was introduced under the MBIPV program. The target was
the residential and commercial sectors. The aim of the project was
to provide a direct chance to protect the environment and
participate in RE initiatives. The funds for the program were
granted by the Malaysia government (Suruhanjaya Tenaga), PV
manufacturers and householders.
Under the MBIPV project, applicants can contribute to the
program based on a bidding process which is open to the public
each six months. “SURIA for Developer” is the main part of the
National Malaysian Building Integrated Photovoltaic (MBIPV) program. SURIA 1000 is exclusively for property developers to
promote the widespread use of solar photovoltaic systems on
buildings [36].
Based on cost and benefits analysis photovoltaic systems are
not an economical option at this time. Including solar photovoltaic
in electricity bill can be considered in about 6–7 years when this
technology becomes cost-effective. Although photovoltaic is a
wide spread renewable energy technology, new technology and
experiments should be incorporated to make them more efficient.
3.4. The Economic Transformation Program (ETP)
The Economic Transformation Program was announced in
October 2010. It was introduced to lift the country’s economy in
12 main National Key Economic Areas (NKEA) [37] and make
Malaysia a high-income nation by 2020. The NKEAs are the core of
ETP. They have higher priority to receive government support
including funding and ministerial attention. Energy has been
recognized by ETP as one of the main NKEAs and electricity as
Table 3
Status of SREPP in March 2010 [32].
No Category Mini hydro Biomass Biogas Remark
No. of
projects
Capacity
(MW)
No. of
projects
Capacity
(MW)
No. of
projects
Capacity
(MW)
1 Licensed Projects 6 17.8 9 79 3 4.95 Total licensed projects is 18 with capacity of 101.75 MW
Projects already in
operation
3 8 5 45 2 3.7 10 Projects with 56.7 MW capacity is already operational
Projects under
construction
2 7.3 1 5 1 1.25 4 Projects with 13.55 MW capacity are under construction and
expected to be operational before 2010
2 Approved Projects(yet
to be licensed)
7 43.5 12 125 6 15.9 Total projects is 25 with capacity of 184.4 MW
Projects under
construction
0 0 1 10 3 2.9 4 projects with 12.95 MW capacity are under construction and
expected to be operational in year 2011–2012
Total 13 61.3 21 204 9 20.85 Total approved projects is 43 with capacity of 276.15 MW
S. Mekhilef et al. / Renewable and Sustainable Energy Reviews 40 (2014) 497–504 501
one of the most important energy categories in Malaysia’s economic growth.
In line with the ETP, there is a great need to boost PV panel
production between 2010 and 2020. PV panel production in Malaysia
has been about 3% of the world’s total production in 2009 [38]. Under
ETP, Malaysia is going to be at the forefront in the manufacturing of
PV technology by 2020, instead of a mere assembler. In addition to
energy, palm-oil production has a significant role in the national
economy.
3.5. The Feed-in Tariff (FiT)
The Feed-in Tariff (FiT) conception was first hosted by the
United States (US) [39]. It was first established in Malaysia in 2011.
The program is monitored by the Sustainable Energy Development
Authority of Malaysia (SEDA) [40] under the Ministry of Energy,
Green Technology and Water. Based on the program schedules, 1%
of the electricity tariff from the consumer will be used to support
development of RE. The aim is to run the RE industry economically
and enhance the public awareness [41]. Proposed FiT rates are
presented in Table 4. According to Table, 1% of the electricity tariff
from the consumer will be used to support development of RE and
will not have an effect on low-income consumers (consumption
less than 200 kW h per month).
4. Building an energy efficiency program with green prospects
The green building idea was introduced to save energy and
increase the efficiency of building resources including water,
energy and materials. The program was initiated to lessen the
long-term harmful impacts of toxic substances on humans. The
building efficiency program tries to propose a better use of
resources in the design, operation, construction, maintenance
and destruction of buildings [42].
4.1. The Malaysian Industrial Energy Efficiency Improvement Project
(MIEEIP)
In 1999, the Malaysian Government, the United Nations Development Program (UNDP) and the Global Environmental Facility
(GEF) announced a collaborative project called MIEEIP. In the 7th
Malaysia Plan (1996–2000), energy efficiency (EE) was introduced
nationwide for the first time. It was founded on the Malaysia
Energy Centre (PTM); however, some barriers forced the
government to initiate MIEEIP to further improve energy efficiency
in the industrial sector. The major barriers have been as follows:
– Inadequate energy rules (such as EE standards and labelling).
– Limited consciousness of EE techniques and their economic
effects.
– Industry tendency to invest in production improvements rather
than efficiency.
A number of measures were adopted to improve the EE
including a plan to gradually eliminate incandescent light bulbs
by 2014. This program intends to decrease carbon-dioxide emissions by 732,000 t and also reduce the energy consumption by
1074 GW each year. An EE building has been modelled and
constructed as a “Low-Energy Office” in Putrajaya. Another example of EE building modelling is the “Zero-Energy Office” in Bandar
Baru Bangi. The low-energy office and zero-energy office buildings
are discussed subsequently.
4.1.1. Low-Energy Office (LEO) building
Fig. 3 shows the low-energy office building in Putrajaya. The
construction of the building was completed in 2004. The architecture and design was provided by Danish International Development Assistance (DanIDA) with the participation of local
consultants [43]. Currently, the Ministry of Energy (currently
Ministry of Energy, Green Technology and Water) occupies the
building. The energy consumption of the building is only 50% of
that of a normal office building by saving energy for the lighting,
heating and cooling purposes of the building.
Table 4
Proposed Malaysian FiT rates (starting at 2011) [15].
RE
technologies/
resources
FiT
duration
(Years)
Range of FiT
rates (RM/kW h)
Min–Max
Annual
degression
(%)
Displaced
electricity cost
(RM/kW h)
Biomass (palm
oil, agrobased)
16 0.24–0.35 0.5 0.2214
Biogas (palm
oil, agrobased,
farming)
16 0.28–0.35 0.5 0.2214
Mini-hydro 21 0.23–0.24 0 0.2214
Solar PV 21 1.25–1.75 8 0.3504
Solid waste and
sewage
21 0.30–0.46 1.8 0.2214
Wind 21 0.23–0.35 1.5 0.2214
Ocean,
geothermal
21 0.28–0.46 1 0.2214
Fig. 3. LEO building in Putrajaya.
Fig. 4. PTM-ZEO building in Bandar Baru Bangi.
502 S. Mekhilef et al. / Renewable and Sustainable Energy Reviews 40 (2014) 497–504
4.1.2. Zero-Energy Office (ZEO) building
As a result of the LEO project, a ZEO building was designed and
constructed in Bandar Baru Bangi and is used as a Pusat Tenaga
Malaysia (PTM) office. This building is totally dependent on
the energy produced by in-site RE installations [43]. It is the first
self-sustainable building in Southeast Asia. Fig. 4 shows the PTMZEO building in Bandar Baru Bangi.
4.2. The green building index (GBI)
The PAM (Pertubuhan Arkitek Malaysia/Malaysian Institute of
Architects) and ACEM (the Association of Consulting Engineers
Malaysia) introduced the Green Building Index (GBI) as a new
rating system in April 2009. The new rating system takes into
account the indoor environment quality, sustainable site planning
and management, materials and resources, energy efficiency,
water efficiency and innovation. Moreover, environmental issues
and criteria are planned to be promoted to enhance the awareness
of designers, architects, planners, engineers and the public [44].
Residential buildings are evaluated based on sustainable site
planning and management, while commercial buildings would be
assessed based on energy efficiency and indoor environmental
quality. Although GBI labelling is voluntary, applicants must first
be assessed by a certifier appointed by GSB (Green building index
Sdn Bhd) to be GBI-certified. Initially, a provisional award is issued.
When the building has been completed, the full award is given.
The building needs to be checked and verified every three years to
keep the award.
5. Conclusion
In line with the energy diversification in Malaysia’s plans and
projects, renewable energy has been recognised as a promising
alternative to conventional energy resources. Malaysia has
accepted the need to reduce greenhouse-gas (GHG) emissions by
ratifying the 1972 Montreal and Kyoto protocols.
The Government of Malaysia has announced various programs
and policies to increase the awareness of the public about the
significance of using renewable energy resources. Another major
concern for initialising RE projects is the contribution to CO2
emission reduction and becoming a green developing country. In
this regard national and international energy policies obviously
show a great effort in energy scenarios; however, Malaysia still
has a lot of potential in order to fully utilise RE resources. Hence
more collaboration between public and government needs to be
performed to ensure a remarkable achievement.
Malaysia has initiated various programs to encourage individuals and communities to apply RE sources for household and
industrial applications and invest in RE resources. These programs
can significantly promote energy efficiency applications and conserve forests and natural resources from pollution. Furthermore,
these programs are aimed at reducing GHG emissions, decreasing
the global-warming incidence and helping to improve solid-waste
management. However, the country is undertaking vast developments in socio-economic status as a developing country, so that
GHG emissions will tend to increase in the near future.