Malaysia energy strategy towards sustainability: A panoramicoverview of the benefits and challenges

Nor Afifah Basri n, Ahmad Termizi Ramli, Abubakar Sadiq AliyuDepartment of Physics, Faculty of Science, Universiti Teknologi Malaysia, 81310 Skudai, Johor, Malaysia

a r t i c l e i n f o

Article history:Received 23 March 2014Received in revised form23 September 2014Accepted 19 October 2014Available online 15 November 2014

Keywords:Malaysia electricity sectorEnergy outlookPower expansion planDiversification policy

a b s t r a c t

Sustainable energy supply is essential for actualizing Malaysia's vision to become a high-income country.The current power production and demand trends show that Malaysia has a reserve margin that willonly last for the next few years. This calls for further investment, research and development in thecountry's power sector in order to meet the ever increasing energy demand. The government'sdiversification policy and power sector expansion plan emphasizes on the incorporation of renewableenergy sources (RESs) and other less CO2 emitting sources like nuclear into the national energy mix.However, the environmental ramifications of this policy should be part of any future expansion plan ofnational grid. This paper presents a panoramic overview of the Malaysian energy sector, the energypolicy revolution and the power sector expansion strategy towards secure sustainability. We want tobring into focus the benefits and challenges of Malaysia's power sector expansion plan with the aim ofstimulating further discussion and research on the environmental ramifications of the plan.

& 2014 Elsevier Ltd. All rights reserved.

Contents

1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10952. Malaysia energy mix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1095

2.1. Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10962.2. Coal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10972.3. Hydropower . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10972.4. Fuel oil and diesel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10972.5. Renewable energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1097

3. Revolution of Malaysia's energy policies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10983.1. National energy policy (1975–2009). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10983.2. New energy policy (2010) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1098

4. Energy scenario in Peninsular Malaysia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10984.1. Electricity supply and generation capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10994.2. Electricity consumption trending . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10994.3. Long term energy mix forecast . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10994.4. Expansion plan in power sector . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1100

5. Renewable resources for greener energy production. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11005.1. Potential RE source for commercial use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1101

5.1.1. Solar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11015.1.2. Municipal solid waste (MSW) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11015.1.3. Biomass . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11015.1.4. Mini hydro . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1101

5.2. ASEAN-5 renewable energy scenario . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11015.3. Progress of renewable energy programs (2011–2013) in Malaysia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1102

6. Nuclear as new potential source for future power expansion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1103

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.2014.10.0561364-0321/& 2014 Elsevier Ltd. All rights reserved.

n Tel.: þ60 196423633.E-mail address: afifahbasri@gmail.com (N.A. Basri).

Renewable and Sustainable Energy Reviews 42 (2015) 1094–1105

7. Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1104Acknowledgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1104References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1104

1. Introduction

Malaysia is one of the fast growing economies in South-EastAsia. The country's economic development is partially driven bygovernment's policy on industrialization which welcomes bothlocal and foreign investments. As one of the rapidly developingcountries in Southeast Asia, Malaysia is committed to becoming adeveloped nation by the year 2020. To realize this vision, economicgrowth was propelled from being an agricultural and commodity-based to manufacturing and service-based [1].

In the last two decades, Malaysia's gross domestic product(GDP) grew steadily at an average of 5.8% per year from 1990 until2011 [2]. Between the years, Ong et al. [2] note that sluggisheconomy growth were experienced in 1998, 2001 and 2009 andthe slow growth in economy has been noted to be due to thefollowing factors; Asian Financial Crisis, slow growth in exportdemand for electronic products and the economic downturn fromthe slow growth in manufacturing industry [1–4].

Human development and economic growth are the key driversof global energy demand. Conversely, diverse, reliable, affordableand sustainable energy sources are needed as foundation toenhance the economic and societal advancements [5,6]. Sinceenergy demand is expected to grow proportionally with GDPand economic growth, Malaysia has to prepare strategies to ensuresustainable and affordable power supply in the future.

Fossil-based energy sources; in particular coal and natural gashas been the major contributing fuels for the power sector inMalaysia. The challenging issue is how to achieve sustainability, i.e.to ensure the security and reliability of energy supply; whiletaking the environmental consequences of energy production intoaccount. Globally, the power sector has been a major contributorof greenhouse gas (GHG) emissions and this has been noted to bedue to the dependence of most electricity generating plants oncoal and oil [7]. In Malaysia for instance, the power sector isexpected to depend more on imported coal in order to meet it'srising energy demand and this has been predicted to result in asituation where the carbon emission profile will be tripled by 2030compared to its magnitude in 2004 [8].

In order to reduce Malaysia's overdependence on fossil fuelsand maintain stability in power supply, various diversificationprograms and policies were introduced. Four-fuel DiversificationStrategy was introduced in 1981 as an extension of the 1979National Energy Policy to decrease dependency on oil. Subse-quently, the Five-fuel Diversification Strategy was introduced in1999 [1] and renewable energy (RE) was made the fifth fuel in theenergy supply mix through the fifth fuel policy under the EighthMalaysia Plan (2001–2005) [9]. The electricity production fromrenewable energy sources (REs) in Malaysia has been improving inthe last two decades as depicted in Fig. 1.

Fig. 1 compares the total electricity production from REsbetween three southeast Asian countries (namely, Malaysia (MY),Singapore (SG) and Thailand (TH)). In 2009, the electricity produc-tion from REs in Malaysia was about 8400 kWh, which is twice thevalue in 1990 [10].

Apart from diversification plan, the government have facilitated amore pragmatic and environment-friendly policy under the tenthMalaysia plan [11]. The tenth Malaysia plan (2011–2015) emphasizesnational commitment towards green technology by aiding research

institutions' activities on green technology towards commercializa-tion through appropriate mechanisms [9,12].

Malaysia is a one of the signatories of the Kyoto Protocol; andthe country has been working towards a low carbon economy andcommunity with the aim of reducing greenhouse gases (GHGs)emissions and ultimately the effects of global warming [13].Malaysia's Prime Minister pledged to reduce 40% of the country'sCO2 emissions intensity per unit GDP by 2020 against a 2005baseline to show Malaysia's commitment towards greener energyat the United Nations Framework on Climate Change Conventionin Denmark [14]. This pledge needs a lot of commitments in thepart of the government, especially when one considers the questof industrialization which is almost totally energy depended.

This paper presents an overview of the Malaysia energy sector,the energy policy revolution and the power sector expansionstrategy towards secure sustainability. The aim of this paper is tobring into focus some of the challenging issues of Malaysia'spower sector expansion plan which aims at reliability, sustain-ability and security of energy supply in order to stimulate furtherdiscussion and research on the subject matter. The contradictionbetween the realization of Malaysia's targets of low carboncommunity and its power expansion strategies is highlighted.Recommendations are provided on how to resolve this differenceand on the ways to strive towards greener energy mix which is thesole goal of the tenth Malaysia plan.

2. Malaysia energy mix

From 2010 to 2012, the total primary energy supply in Malaysiahas increased by 8.49% from 76,809 ktoe to 83,939 ktoe respec-tively. The total final energy demand has increased by 11.21% from41,476 ktoe to 46,710 ktoe in the same years [6,15,16].

Malaysia's total installed electricity generation capacity was24,361 MW in 2010 and 29,143 MW in 2012. The total electricitygeneration has increased by 19.50% from 108,175 GWh to134,375 GWh from 2010 to 2012, while electricity consumptionhas increased by 10.17% from 104,521 GWh to 116,354 GWh in thesame duration [15,16].

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Fig. 1. Electricity production from REs in MY, TH and SG [10].

N.A. Basri et al. / Renewable and Sustainable Energy Reviews 42 (2015) 1094–1105 1095

Natural gas, coal and hydro are the primary fuels for powergeneration. The contribution of individual fuel source for electri-city generation in 2012 was as follows; coal for 48.3%, followed bynatural gas accounted for 39.4%, hydropower for 7.4%, diesel andfuel oil for 4.7% and RE at 0.2% (See Fig. 2) [6,15,16].

2.1. Natural gas

Natural gas was discovered in the year 1983; Malaysia naturalgas proven reserve stands at 58 trillion cubic feet (Tcf) in 2006 [17],88 Tcf in 2008 [13] and 83 Tcf in 2010 [18]. The reserves are mainly

found offshore east Malaysia (Sabah and Sarawak) and somelocation in the east Coast of Peninsular Malaysia [18]. Managementof natural gas resources was the responsibility of PetroliamNasional Berhad (PETRONAS), who manages the exports anddistribution to national sectors including power sector [19]. The,natural gas supply comes from Kerteh, Terengganu and Malaysia–Thailand joint development area through the Peninsula gasutilization (PGU) pipelines (Fig. 3). The PGU pipeline is one ofthe most extensive natural gas pipelines in Asia. It spans morethan 880 miles with capacity to transport 2 billion cubic feet everyday [13]. The PGU pipeline initiative helped to expand regional

Fig. 3. Natural gas supply network in Malaysia [22].

Fig. 2. Energy input in power station 2012 [16].

N.A. Basri et al. / Renewable and Sustainable Energy Reviews 42 (2015) 1094–11051096

natural gas trade, especially with neighboring countries like Thailand,Singapore and Indonesia [20].

Natural gas reserves in Malaysia are the second largest in SouthEast Asia and the 12th largest in the world [17,21]. A study in 2010indicates that the natural gas could contribute as the main sourceof energy in Malaysia's energy mix for the next 36 years [13].However, in the 2010 report of the Economic TransformationProgram and PETRONAS indicated that oil and gas reserve willdeplete at the rate of 4% annually and will decrease faster after 10years [19]. Hence, depending on national gas reserve is deemednot practical in future power expansion plans, unless additionalsupply is imported to meet the ever increasing demand. Malaysiacommenced the importation of natural gas fro Indonesia andThailand in the years 2002 and 2005, respectively [18].

Peninsular Malaysia has 18 gas-fired power plants with com-bined capacity of 12,888 MW which accounts for 58% of the powerproduction in the energy mix [1,18]. The power sector is the majorconsumer of natural gas, as its account for half of the totalconsumption. The consumption of natural gas has been on theincreases from 1990 to 2008 even after implementation of FiveFuel Diversification Strategy in 2001 [22,23]. However, develop-ment of new technologies and robust diversification strategiescould lead to reduction in the dependence on natural gas by thepower sector and this will help to meet and balance otherdemands [19,24].

2.2. Coal

Globally, coal provides around 30% of primary energy needsand generates 41% of the world's electricity. In Peninsular Malay-sia, coal is fully imported from countries such as Indonesia,Australia, South Africa and China for power generation[13,14,17]. Malaysia has significantly large coal reserves, but mostof them are found in inland areas which have inadequate infra-structure and high extraction cost. Most reserves are found inSabah (29%) and Sarawak (69%), and only 2% in Peninsular [18].

The percentage contribution of coal in electricity generation hasincreased from 9.7% (in 1995) to 48.3% (in 2012) [16,24]. The increasedepicts the result of reducing dependence on natural gas for electricitygeneration and the starting new coal fired power stations by theindependent power producers (IPPs) [1,25]. Coal import is expected toincrease in response to the governmental policy of intensifying its usefor power generation [8]. At the moment, coal consumption stands ataround 20 million ton every year and the consumption is expected toincrease to more than 25million ton annually after the commissioningof new coal plants in Manjung and Tanjung Bin [1,14].

The major concern regarding coal is the ability to maintain theimported supplies as it exposes Malaysia to interruption in supplyand increases in cost of coal. Although coal is the cheapest and mostabundant fossil source, the price and supply is fully controlled bysuppliers, depending on the global demand which increases eachyear. Malaysia has to compete with major coal consumers such asChina, USA and most recently Japan, who switched to non-nuclearpower after Fukushima nuclear accident. In addition, the increasingthreat of anthropogenic global warming has caused policy makers tobegin to consider moving towards an agreement that would chargepower plants for CO2 emission and if this happens, the days of cheapelectricity from coal will be gone [26]. Since uncontrollable supplymay have negative effects on the national power security, effortshave been made to explore and develop local coal mines in Sarawakin addition to the imported supplies [18,21].

2.3. Hydropower

In Malaysia, hydropower is the only REs that commerciallycontribute to the national energy mix. The first major dam

(Chenderoh Dam) was constructed in 1939, followed by SultanAbu Bakar Dam in 1963. After the oil crisis of 1970s, more damswere constructed and this action eventually puts hydroelectricinto the main energy mix of Malaysia [27]. The combined installedcapacity of hydro in Peninsular Malaysia is 1911 MW from 4 hydro-electric plants. The share of hydropower in the energy mix was10% in 2000 and it declined to 5.6% in 2010 [18]. The completion of theBakun Dam in Sarawak which has an installed capacity of 2400 MWhas increased the share of hydro to 9% in 2012 [1]. The Bakunhydropower was planned to be connected to grid in the Peninsularby Sarawak Interconnection Project via undersea cables [28].

Tenaga Nasional Berhad (TNB) plans to increase the hydro-electric power capacity from its current capacity by 2020. The2009 production capacity of hydro was 4000 MW [29]. However,construction of new hydropower plant is overwhelmingly complexand initial capital intensive, some of the other issues that areassociated with hydroconstruction are the social, environmentaland political ramifications [17,21]. A relevant suggestion is toincrease the output capacity via upgrades of existing turbine unitsthat almost reach their life time expectancy. The upgrade will becommenced along with overhaul progress to the plants [1].

It is expected that in the long term, hydropower will contributeimmensely to Malaysia's energy sector. Some of the advantages ofnew hydroplant appear to are its socioeconomic impacts as floodcontrol, irrigation farming, rural electrification and social infra-structure such as roads and provision of employment to the localpeople [17,21].

2.4. Fuel oil and diesel

Contribution of oil in Malaysia energy mix was once up to 87.9%before the international oil crisis in 1973 and 1979, and theimplementation of Four-fuel Diversification Strategy in 1981 [25].Majority of Malaysia oil reserves are in the east coast of PeninsularMalaysia, where high quality oil is found. Malaysia's oil productionstarted to decline significantly in 2006 even though several newoil fields have come online during last few years [25]. Thecontribution of oil in the energy mix was declined sharply tomerely 10% in 2003 [22] and is only around 3% in 2011. Apart fromusing oil for power generation, it is exported as crude oil or asdownstream petroleum products [19,6].

2.5. Renewable energy

Malaysia is blessed with abundant RE resources such asbiomass/biogas from oil palm wastes, mini hydro, solar andmunicipal solid wastes [30]. Table 1 summarizes the estimatedRE potential in the long run [13].

RE was added as the fifth source of energy when the Five-fuelDiversification Strategy replaced the Four-fuel DiversificationStrategy in 2002, with the target of providing 5.5% of powergeneration in the energy mix by 2010 through Small RenewableEnergy Power (SREP) Program [18]. However, the development israther slow, with end result of only 1% of the total energy mixbeing renewable [13,30].

Table 1Renewable energy potential in Malaysia [13].Source: Malaysia Energy Center's National Energy Balance.

Renewable energy Potential (MW)

Mini-hydro 500Biomass/biogas (oil palm mill waste) 1300Municipal solid waste (MSW) 400Solar PV 6500

N.A. Basri et al. / Renewable and Sustainable Energy Reviews 42 (2015) 1094–1105 1097

Currently, installed RE capacity stands at less than 1% of totalelectricity generation in Malaysia. Even though the developmentof RE is still in early stage, it is estimated that utilizing 5% of theenergy mix for RE will save up to 5 billion Malaysian Ringgit over aperiod of 5 years [31].

3. Revolution of Malaysia's energy policies

A positive progress in energy sector is partly contributed by theimprovement in energy policy and elaborate future plans byenergy commission and energy suppliers. Malaysia's energy poli-cies have evolved over the years since the 1973 world oil crisis. Thepolicies guide the energy-related activities in Malaysia as illu-strated in Fig. 4 [1].

3.1. National energy policy (1975–2009)

Implementation of energy policy in Malaysia starts withNational Petroleum Policy of 1975 as subsequent to the PetroleumDevelopment Act in 1974. The policy regulated oil and gas industryas major factor to accelerate economic development. In 1979,National Energy Policy was introduced with 3 principal objectives;the supply objective, the utilization objective and the environmentalobjective. These objectives served as guidance in the formulation ofMalaysia's five-year development plan. The main purpose is toensure the availability of the energy supply with reasonable priceto support the nation's economy development [31].

National Depletion Policy (NDP) was introduced in 1980 tomanage oil exploration by controlling production in major oilfields. The aim of the NDP was to prolong the lifespan of oilreserves for future security and stability of oil supply [1]. Thepolicy was then extended to include natural gas reserves in 1996.The gas and oil production were limited to certain amount per dayto control rapid depletion.

In 1981, the government of Malaysia designed Four-fuel Diver-sification Strategy to reduce overdependence on oil and ensureenergy reliability and security. The strategy aims for a balancedenergy supply mix of oil, gas, hydropower and coal, as well asutilizing local resources to enhance security of supply. The result ofthis policy lead to a significant shift from oil to natural gas, as it isseen as appropriate to compliment supply and environmentalobjectives as spelled out in the National Energy Policy. The Four-fuel Diversification Strategy was further developed into Five-fuelDiversification Strategy. Under the current strategy, renewableenergy resources were considered as the fifth fuel for the energymix. Modalities on utilization of REs are presented in the NationalRenewable Energy Policy and Action Plan in 2009 [30,32].

3.2. New energy policy (2010)

The latest energy policy was implemented in 2010 under theTenth Malaysia Plan. The Tenth Malaysia Plan describes the new

energy policy as a further step to encapsulate all efforts to ensureeconomic efficiency, security of energy supply and to meet thesocial and environmental objectives in National Energy Policy of1979 [1,12]. New Energy Policy 2010 identified five strategic pillarsfor providing the primary areas of focus to achieve the NationalEnergy Policy objectives. The five strategic pillars and theirpurpose are as follows [1]:

a. Energy pricing – Rationalizing energy pricing gradually tomatch market price, by taking into account current economiccondition and affordability to the citizen.

b. Strategic supply side developments – Undertaking a morestrategic development of energy supply by diversifying energyresources, including renewable energy resources. Nuclearenergy will also be considered as an alternative source ofenergy.

c. End use energy efficiency – Accelerating the implementation ofenergy efficiency initiatives in the industrial, residential andtransport sectors.

d. Energy governance and regulation – Improving governance tosupport the transition to market pricing, while providingassistance to mitigate impact on the low income group.

e. Management of change and affordability – Ensuring that theNew Energy Policy is implemented based on an integratedapproach and according to schedule to achieve energy supplysecurity.

The new policy also emphasizes on National Green EnergyPolicy (NGEP), under which special consideration was included inthe RE development plan. Short term goals vested in NGEP are asfollows [9,33]:

1. Increased public awareness and commitment for the adoptionand application of green technology through advocacyprograms.

2. Widespread availability and recognition of green technology interms of products, appliances, equipment, and systems in thelocal market through standards, rating and labeling programs.

3. Increased foreign and domestic direct investment in greentechnology manufacturing and services sector.

4. Expansion of local research institutes and institutions of higherlearning to expand research, development and innovationactivities on green technology towards commercializationthrough appropriate mechanisms New RE act and Feed-in Tariff(FiT) mechanism to be launched.

5. New RE act and FiT mechanism to be launched.

4. Energy scenario in Peninsular Malaysia

Malaysia; being a growing industrious country, is expected tohave continuous rise in energy demand and with GDP growth[21,34]. From total supply figures, most of power plants are locatedin Peninsular Malaysia due to the higher population density and it

Fig. 4. Malaysia energy policy development.

N.A. Basri et al. / Renewable and Sustainable Energy Reviews 42 (2015) 1094–11051098

has high number of industrial areas than those in eastern Malaysia(Sabah and Sarawak).

Sensitivity studies conducted by various creditable agenciesshow that the GDP growth in Peninsular Malaysia is estimated tobe 5.5% in 2013 and expected to increase to 5.7% by 2014. The longterm GDP growth is estimated to be 5.9% per annum (p.a.) from2016 until 2020 and then increase to 6.2% p.a. from 2021 until2030 as shown in Table 2.

4.1. Electricity supply and generation capacity

The total installed capacity in Peninsular Malaysia was24,242 MW in 2011 and 24,309 MW in 2012. The total electricityconsumption for 2011 and 2012 were 97,939 and 102,174 GWhrespectively. The maximum peaks of demand were 15,476 and15,826 MW in 2011 and 2012, respectively.

As of 31st December 2012, the total installed capacity was21,749 MW, while electricity gross generation was 117,797 GWh.The highest peak demand was recorded on 20th June 2012, whichwas 15,826 MW [1]. Fig. 5 depicts the Peninsular Malaysia'selectric production, peak demand and energy mix from 2010 to2012. The total generation capacity is higher than the peakdemand for the three years under consideration (2010–2012), thisindicates that there is high reserve margin in the electricity sector.A 3.6% increase demand in 2012 compared to 2011 resulted in

decrease in the reserve margin which was 41% in 2011 and 37.4% in2012 [30]. This situation signals that a significant decrease reservemargin may occur in the future.

4.2. Electricity consumption trending

The electricity consumption pattern in Peninsular Malaysia for2012 is presented in Fig. 6. The sectors with the highest consump-tion are the commercial, residential, agriculture and transportsectors, in that order [1,16].

Historically, industrial sector contributed towards the largestpercentage in total electricity sales and has grown largely by13% p.a. between 1980 and 2000 and 2.9% p.a. between 2000 and2011. In terms of sectorial sales, industrial sales growed moder-ately at 3.9% in year 2013, and by 3.5% in year 2014. Commercialsector sales is expected to grow at an average of 4.0% for the nexttwo years while domestic sales growth is anticipated to lingeraround 3.9%. Based on the latest electricity demand performanceand current economic trends, an average electricity sales growth of4.0% per annum (p.a) is forecasted for 2012–2015 period. Theelectricity sales are forecasted to reach 129,482 GWh in the year2020. The electricity generation and peak demand are bothprojected to grow at the averages of 3.5% p.a. and 3.7% p.a.,respectively during the above period [1].

4.3. Long term energy mix forecast

The long term load forecast, also known as demand forecastplays a central role in the power system planning and generationdevelopment plan. Usually, forecast load is up to 20 years aheadand it's conducted on annual basis with mid-year revision, whichis in line with the License Condition and Malaysian Grid Code[1,35].

As for the fuel types in the energy mix, gas usage is expected todecrease due to the retirement of several gas plants, which is tocommence by 2016. It will further decrease in 2019 to 32%, wherecoal will make up 64% of the overall mix and overtakes gas asdominant fuel. The pattern of the mix shows that gas usagedecreases over time and will constitute only 27% of the overallmix by the year 2022 [1].

Generation development plan studies are carried out from timeto time to continually evaluate the recommendation in planningfor future capacities. Established analytical tools are used exten-sively to carry out simulations to incorporate all important para-meters such as fuel price, fuel mix, technology employed anddemand profile.

The forecasted generation mix for Peninsular Malaysia basedon the approved Generation Development Plan is shown in Fig. 7 [1].Unstable electricity pricing was expected due to volatility of coalprice and supply [19], as well as the consideration to graduallyraise the gas price until it reaches the market price of RM44.36/mmBtu [1]. The plan proposed a system interconnection with

Fig. 6. Electricity consumption by sector [16].

Fig. 7. Forecasted generation mix (2013–2022) [19].

Table 2Projected GDP growth for year 2014–2030 [1].Source: Energy Commission Report 2012.

Year 2014 2015 2016–2020 2021–2030

GDP (%) 5.7 5.8 5.9 6.2

Fig. 5. Electricity production and peak demand.

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Sarawak with the aim of ensuring balance fuel mix and stabilizedelectricity price [20].

In order to have a balanced fuel mix, commencement ofSarawak interconnection is targeted to begin by 2020 and thismay reult in less coal usage. The share of hydroelectricity in thefuel mix is forecasted to be consistent at a growth rate of 4% due tothe addition of new plants with total capacity of 937 MW from2015 to 2022.

Another plan is to consider nuclear as new source in the energymix as stated in the new energy policy. Nuclear energy is atpresent the only energy technology with a secure base loadelectricity supply and no GHG emissions that has the potentialto expand at a large-scale. However, since Fukushima nuclearaccident of Japan, nuclear energy has been under increased publicscrutiny. Germany has implemented a drastic transformation ofthe position of nuclear energy in the country, a position which isbelieved to have some political influence as the “post-Fukushima”German nuclear policy influences election results [26,36].

4.4. Expansion plan in power sector

As of 31st December 2012, the installed capacity in PeninsularMalaysia was 21,749 MW, primarily fueled by natural gas, coal andsupplemented by hydro (Table 3).

The expansion plans involve the expansion of existing powerplants, and consideration of new energy source via new construc-tion. The expansion program is important to cater for imminentcapacities retirement and system growth. It is revised, evaluatedand recommended to the government on annual basis by anapproval committee called JPPPET [1].

There are currently 12 new plants under construction and3 extension project scheduled to be connected to the grid between2015 and 2024. The new and extension projects are listed inTables 4 and 5, respectively.

The new coal capacity will increase by 2 GW in 2017, while sixnew hydro projects are expected to be connected to the nationalgrid by 2024. The combined installed capacity of hydro is 981 MW.Data from Tables 4 and 5 show that natural gas and coal willmaintain their roles as the primary fuels that drive the Malaysia'selectricity sector. It is expected that the combined capacity (fromnew and extended projects) will be over 4 GW by 2020. It is clearthat the government wants to further the development of con-ventional power plants whose fuels are readily available despitesits pledge to reduce carbon emission. However, the environmentalimpacts of energy generation, power plants construction andoperation are enormous. The next section presents the environ-mental impacts of Malaysia's energy use and her effort towardsgreener production.

5. Renewable resources for greener energy production

In 2008, the CO2 emission of Malaysia was about 118 milliontones and the per capita carbon emission was 7.2 tones [37]. Fig. 8shows the CO2 emission of Malaysia in the last 26 years. The CO2

emission has been on the increase from the 1990s until now [24].Until drastic majors are taken, the government of Malaysia maynot be able to cut down its carbon emission to the environment asannounced.

The total environmental impacts of electricity generation dueto CO2, SO2, and NOx emission from electricity generation inMalaysia have been estimated by Ref. [38]. The pollution intensityof CO2 is estimated to increase from 298, 339 kt in 1999 to 800,519 kt by 2020. The CO2 pollution intensity will be tripled. For SO2,

the emission intensity is stable. It is has been estimated to increaseby 21% from 1999 (3159 kt) to 2020 (3840 kt). The SO2 emissionprofile is expected to increase from 2445 kt (in 1999) to 18,316 kt(in 2020). This shows that the environmental loading or globalwarming potential of Malaysia's electricity generation technolo-gies are enormous. There is the need to tap into clean energypotentials of the country in order to achieve its target on reductionof carbon emission.

Table 4New generation projects.Source: Energy Commission Report 2012.

Projects Fuel Installed capacity(MW)

Commercial operationdate

Manjung IV Coal 1010 2015CBPS repowering Gas 343 2015Hulu Terengganu Hydro 250 2015Hulu Terengganu(Tembat)

Hydro 15 2016

Tg Bin energy Coal 1000 2016TNB Prai CCGT Gas 1071 2016Pengerang co-generation

Gas 400 2017

Additional Chenderoh Hydro 12 2018Tekai Hydro 156 2020Telom Hydro 132 2022Nenggiri Hydro 416 2024

Table 5Power extension projects.Source: Energy Commission Report 2012.

Projects Fuel Capacity (MW) New expiry date

S.J. Sultan Iskandar Gas 275 2015Genting Sanyen Gas 675 2015Segari Energy Ventures Sdn. Bhd Gas 1303 2015

Fig. 8. Malaysia's CO2 emission (1980–2006) [26].

Table 3Installed capacity by energy source type [1].Source: Energy Commission Report 2012.

Type Fuel Capacity (MW)

Conventional thermal Coal 7170Combined cycle gas turbine (CCGT) Gas 9373Conventional thermal Gas 840Open cycle gas turbine (OCGT) Gas 2455Hydroelectric Hydro 1911

Total 21,749

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The power sector of Malaysia is still very much dependent onfossil fuels and with the ever-increasing energy demand, it isinevitable that CO2 emission will continue to climb as long as fossilfuels remain the main contributor in the country's energy mix [13].Emphasis on green technology is promoted in the 9th Malaysia Plan(2006–2010) and efforts on the utilization of RE resources andefficient use of energy were further encouraged [1].

The establishment of the Ministry of Energy, Green Technologyand Water to replace the Ministry of Energy, Communications andMultimedia in early 2009 may reflect Malaysia's commitment indriving the message that ‘clean and green’ is the way forwardtowards creating an economy that is based on sustainable solu-tions [13]. Some of the progresses made in adding renewables intoMalaysia's energy mix are presented in the subsequent parts ofthis paper.

5.1. Potential RE source for commercial use

In Malaysia, RE sources (other than hydro) are generated onsmall scale basis and are mostly operated by independent powerproduction companies. Solar, mini hydropower and biomass areuntapped potential RE resources that could drive Malaysia's futuretowards sustainable and greener energy.

5.1.1. SolarSolar energy is harnessed through the conversion of sunlight

into electricity via solar cells in solar panel. This system is calledPhotovoltaic (PV) system. An equatorial country such as Malaysiais favorable for the development of solar energy because itsclimate is generally hot all year long with approximately 4000–5000 Wh m�2 daily radiation, except for monsoon season duringthe end of the year [18,39–42]. Although PV system has highpotential for commercial use, the cost for PV panel and technol-ogies is still high for mass power generation [17,19]. The cost ofsolar electricity is 20 times higher than the conventional fuels.At present, PV application is still restricted to rural electrification,garden lighting, and water heating in hotels and upper-classurban home.

The funding of research in the areas of solar energy by theMalaysian Government has been quite encouraging. Researchgroups at some of the five research Universities in Malaysia havebeen involved in solar energy research like inverters, PV concen-tration, solar cells fabrications and characterization, hybrid sys-tems and energy conversion tracking systems. Some of the worksundertaken by researchers in local universities are

1. Development of grid-connected (3 kW) inverter by researchersat Universiti Malaya (UM) [43–46].

2. Development of solar cell by researchers at Universiti SainsMalaysia (USM) [47–49].

3. Development of (5 kW) grid-connected inverter, solar homeand solar car by researchers at Universiti Teknologi Malaysia(UTM) [50–52].

4. Development of low-coast solar water heater by researchers atUniversiti Teknologi MARA (UiTM) [53].

An important issue that has slowed down the development ofsolar energy in Malaysia is that there is only one buyer i.e., thenational utility company (TNB) and this has resulted in an unequalbargaining position of utility and solar energy projects (and otherREs) [54]. An analysis of the way forward for solar PV in Malaysiaby Muhammad-Sukki et al. [55] found that Feed-In Tariff (FiT)scheme has the potential to increase solar PV penetration and theGreen Technology Financing Scheme (GTFS) is potentially a goodsource of funds for companies while for home owners, a soft loan

facility with an interest rate of 5% is a possible source of funds forfinancing solar energy program.

In 2005, the Malaysian Building Integrated Photovoltaic Tech-nology (MBIPV) project was launched with the primary target ofencouraging long term cost reduction. The Building IntegratedPhotovoltaic (BIPV) panels are all integrated into building designto provide electricity for building. It is also connected to thenational electricity grid to help feed peak power demand duringpeak daylight hours. Until 2010, PV systems have contributed only0.4 MW to the national grid. The unit cost of PV installations andPV system has dropped by 16% in average since BIPV wasintroduced [13]. Comparing the contribution of solar in thenational energy mix to the potential (Table 1), it is clear thatMalaysia still has a lot to do in terms of utilizing its solar potential.However, solar energy is expected to surpass other RE sources by2020 if the price continues to decrease and the technologybecomes more cost friendly for commercial use [30].

5.1.2. Municipal solid waste (MSW)MSW in Malaysia involves the disposal of wastes to landfills.

The local authorities and waste management consortia handleapproximately 17,000 tones of MSW everyday throughout thecountry. Biogas energy generation from MSW is an effective andprofitable method for solid waste disposal. Jana Landfill Gas (LFG)power generation is the first MSW power station connected to thenational grid. The 2 MW power plant is located at a landfill area(Air Hitam Sanitary Landfill) and receives about 3000 tones ofdaily domestic wastes from major parts of Klang Valley. Jana LFGpower plant is planned to be expanded due to its potential toproduce energy for a period of 20 years [56,57]. With rapidpopulation growth, it is estimated that the amount of MSW canreach 9 million tons per year by 2020. From that figure, averageMSW generated on daily basis is 24,650 tones; which has thepotential to generate 500 MW of electricity [18,58].

5.1.3. BiomassBiomass energy in Malaysia is generated from agricultural

waste product, such as oil palm waste, wood waste and paddyresidues. The palm oil industry contributes the largest amount ofbiomass energy in Malaysia with total generation capacity of211 MW in 2012. Oil palm has good potential in producing biomassenergy due its calorific contains. With 50% efficiency, it cangenerate 8 Mtoe of energy, and can save RM 7.5 billion per yearof crude oil [34,59]. At present, biogas energy is generated at theoil palm mill for its own use [60,61]. Biomass and biogas plantshave estimated potential to achieve 1340 MWof power productionby 2030 and can be connected to national grid.

5.1.4. Mini hydroSmall scale hydro has become popular alternative compared to

bigger scale hydroproject because of their lower cost, reliabilityand environmental friendliness. Since the late 1970s, many minihydroprojects have been undertaken based on run-of-the-riversystems ranging from 0.5 to 1 MW capacity [30]. As of 2012, thereare 39 units of mini hydro plants with total capacity of 16.186 MWin Peninsular Malaysia [18]. The targeted installed capacity formini hydro is 490 MW by 2020 under the Malaysia renewableenergy development plan. Mini hydro has the prospect to reducethe environmental loading of Malaysia's energy usage if itspotential is fully utilized.

5.2. ASEAN-5 renewable energy scenario

Association of Southeast Asian Nations (ASEAN) is made up ofto 10 member countries located in South East Asia. ASEAN

N.A. Basri et al. / Renewable and Sustainable Energy Reviews 42 (2015) 1094–1105 1101

countries are composed of two parts, namely, northern andsouthern areas. The northern part includes Laos, Vietnam, andCambodia, whereas the southern part includes Thailand, Malaysia,the Philippines, Indonesia, Singapore, and Brunei [62].

Renewable Energy sources are abundantly available in most ofthe member countries of ASEAN. Among the ASEAN countries,Philippines, Indonesia, Malaysia, Thailand and Vietnam are blessedwith most of the types of renewable energy sources [63] such assolar, hydropower, biogass/biomass and geothermal energy. In thispaper, ASEAN-5 refers to the above mentioned countries. Fig. 9below shows the potential of RE sources in ASEAN-5 based on datafrom International Energy Agency (IEA) in 2010 [64].

Each country of ASEAN-5 strives to utilize RE resources in theirenergy production industries. In a report by Ipsos Business Con-sulting [65], the existing capacity and target capacity (in MW) isdepicted through Table 6.

In its special report in 2013, the IEA states that Southeast Asia is‘an extremely diverse and disparate region with vast differences inthe scale and patterns of energy use and energy resources'. Hence,energy related study (including renewables) between SoutheastAsian countries should recognize the differences as an importantdeliberation in the analysis. Ipsos report also described the RE

situation in ASEAN as a presentation of ‘mixed bag’ because ofdifferent stages in RE development in each country, down to theindividual RE sources available within each country. In 2012, Ipsosreported that only Phillipines and Thailand has succeeded in fullycommercializing RE through geothermal and solar power respec-tively [65]. Malaysia has shown significant achievement in itsRenewable Energy Program. The success of FiT program isexpected to help Malaysia achieve the target of fully commercia-lizing most of its RE resources.

5.3. Progress of renewable energy programs (2011–2013)in Malaysia

After the Five Fuel Policy, which encouraged inclusion of REinto the energy mix, various RE programs were conducted andimproved from time to time in order to increase RE contribution inthe energy mix [66]. Several programs and initiatives werelaunched to promote RE utilization such as Small RenewableEnergy Power (SREP), Biomass Power Generation and Demonstra-tion (BioGen) Project and Malaysia Building Integrated Photovol-taic Technology Application (MBIPV) [31,35].

Ref. [67] examined the Small Renewable Energy Power (SREP)performance from 2001 to 2010. Sovacool and Drupady [67], notethat SREP failed to achieve its target because of capacity caps,lengthy approval process, lack of monitoring and unmatchedelectricity tariffs with the production costs. This study led to morecomprehensive study in 2011, where key barriers for RE develop-ment in Malaysia were identified. The new study found thatshortage of investment and manpower, lack of interest fromcommercial investors, and lack of technical know-how has led topoor performance of RE plants [34].

To improve RE performance, several resolutions were proposedto remove the key barriers through comprehensive policy, politicaland social support to RE energy provider. The Renewable EnergyAct was enacted in 2011 to establish and implement feed-in-tariff(FiT) system for RE generated electricity, in which access to powergrid is guaranteed and individual can sell the power generated byRE resources to power companies at premium rate for a specificperiod. Financial support is also granted to the RE producers toenhance the promotion of RE in Malaysia. By 2030, renewableresources are expected to provide 11% of the energy mix [18,35].

Current policy under FiT scheme shows positive results in 2012and 2013 as shown in Table 7 [67]. The RE annual powergeneration has significantly increased, showing promising futurefor RE in Malaysia.

Success in FiT scheme can be attributed to the incentives,financial schemes and funds provided by Malaysia's government.Under Ninth Malaysia Plan budget, incentives were given tocompanies who generate energy from RE based on three categories;energy efficiency incentives, incentives for the use of RE resources

Table 7RE achievement (2012 and 2013).Source: Sustainable Energy Development Authority (SEDA) Malaysia.

Achievement Source Year

2012 2013

Installed capacities (MW) Biogas 5.16 6.58Biomass 52.3 0.0Small hydro 11.7 0.0Solar PV 31.57 56.77

Annual Power Generation (MWh) Biogas 7563.51 18,517.43Biomass 104,544.39 309,352.56Small hydro 25,629.78 73,032.12Solar PV 4707.17 4,5153.38

Fig. 9. Potential of RE in ASEAN-5 [65].

Table 6Existing and targeting renewable energy capacity.

Phillipines Thailand Indonesia Malaysia Vietnam

Existing capacity (MW)Micro hydro 3400 56 86 24 121Geothermal 1966 – 1189 – –

Wind 33 6 1 7 1Biomass 38 1610 445 479 150Solar 1 49 14 0 1Ocean – – – – –

Waste – 13 – 0 2Biogas – 80 – 0 2

Targeting capacity (MW)Micro hydro 8724 281 500 480 5700Geothermal 3461 – 9500 – –

Wind 2378 801 225 – 6200Biomass 316 3003 180 1325 2000Solar 285 932 870 4470 –

Ocean 71 – – – –

Waste – 184 – 276 –

Biogas – 170 – 507 –

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and incentives for green building [32]. Because of slow development,funding for RE was further increased under the Tenth Malaysia Plan.RE fund was specially established under FiT Project, as well as otherschemes such as Renewable Energy Business Fund (REBF), GreenTechnology Financial Scheme (GTFS) and Renewable Energy andEnergy Efficiency Scheme. The special allocation of funds for REdevelopment resulted in the increase in contribution of RE in theenergy mix, thus help Malaysia to expand her power production.

6. Nuclear as new potential source for future power expansion

The 10th Malaysia Plan highlighted the willingness of thegovernment to add nuclear to its energy mix. Nuclear is one ofthe electricity generation technologies with low GHG emission,and on a life-cycle basis the GHG emission of nuclear power plantsis comparable with that of hydro and wind [68].

Nuclear energy has existed for many decades and it has long beenconsidered as the only form of energy that can replace fossil fuelsadequately. Most developed countries such as USA, Russia, Japanand Korea have nuclear reactors as part of their energy mix. Morecountries of the world are increasingly hanging their electricity fate on

nuclear, with about 30 countries, mostly industrialized, relying on it,and more are preparing towards having their pioneer nuclear powerplant . Though, the Fukushima nuclear accident which occurred as aresult of an earth quake and subsequent tsunami inundation ofTEPCO's nuclear power plant in Fukushima- Daiichi has resulted inpublic scrutiny of atomic energy. Some prominent environmentalistshave thrown their supports behind the continued use of nuclear powernow that the threat of global warming seems to be more detrimental.

As at the end of August 2010, 441 nuclear plants wereoperating in 29 countries, with an installed 375 GW, which isequivalent to 14 per cent of global electricity needs and somedeveloping countries have contacted the International AtomicEnergy Agency (IAEA) for assistance on their nuclear plans [68].In southeast Asia, countries such as Thailand, Indonesia, Vietnamand Malaysia have plans for pioneer nuclear program.

In Malaysia, of the three main sources for power generation(coal, gas and hydro), it is expected that the gas supply to thepower sector may not go beyond 2030. To cover for the shortfall ingas supply, coal fired electricity generation may need to beincreased. This is not an attractive option, given that almost100% of the national coal supply is imported [13], and this willexpose Malaysia to interruption in supply and increases in cost ofcoal. Hence, government adopted a more environmentally friendlyapproach which is economically competitive.

The decision to consider adding nuclear was made by policymakers in July 2009 after careful consideration of energy forecastdemand and current energy situation in the country [69]. Nuclearhas been favored because of its economic competitiveness and lowGHG emission [18]. The Malaysian government has decided toinclude nuclear energy as an option in the new energy policy in2010. This is due to the realization that the available national energyresources are inadequate to guarantee supply beyond the year 2030[1,69]. The estimated contribution of nuclear in the 2008 fuel mixprojection by TNB is shown in Fig. 10.

In December 2010, the government announced plans to buildtwo 1000-MW nuclear power plants by 2022; and this wasfollowed by establishment of the Malaysian Nuclear Power Cor-poration (MNPC), which will lead the planning process of utilizingnuclear power in Peninsular Malaysia [18]. Fig. 11 shows theproposed development timeline by MNPC [70].

MNPC, in cooperationwith more than a dozen other governmentalagencies and industrial organizations, had conducted a series ofFig. 10. Energy fuel mix projection (2008) [69].

Fig. 11. Proposed nuclear power program development by MNPC [70].

N.A. Basri et al. / Renewable and Sustainable Energy Reviews 42 (2015) 1094–1105 1103

studies to systematically examine the role of nuclear power inMalaysia and to evaluate the national state-of-preparedness for theimplementation of nuclear power program in Malaysia [17]. Currently,Malaysia is in the preliminary evaluation phase, where activities suchas pre-feasibility study, policy study, regulation revisit and potentialsite selection are actively conducted (Fig. 11). The construction of thefirst nuclear reactor is expected to commence in 2017. The costimplication of building the twin unit (of 1 GW each) is estimated tobe RM 21.3 billion investment up to the year 2020.

There are some critical issues over the state of readiness ofMalaysia to adopt nuclear power. The main concerns have alwaysbeen the nuclear waste disposal, NPP decommission issues, andpossible risks and hazards of NPP. In the wake of Japan's nuclearcrisis in 2011, certain countries opted to freeze and forgo plans tobuild nuclear power plant [70,71]. Malaysia has critically observedthe situation and reviewed the current progress after the incident,which gives valuable information for the feasibility studies. Thepost-Fukushima nuclear program in Malaysia is relatively slowbecause the government is under public pressure to carefullyreconsider safety and security factors based on the informationobtained from the Japanese incident.

From the timeline (Fig. 11), this is the year to officially launchnuclear power program. However, the government is yet to do thatbecause a lot more has to be done in order to assess publicsentiment towards nuclear program before the launching of theprogram and proceeding to the construction phase of the plan.

7. Conclusion

This study presents an overview of the Malaysia energy sector,the energy policy revolution and the power sector expansionstrategy towards secure sustainability. The current and futurescenarios of power sector in Malaysia have been highlighted. Fromcomparison of historical energy consumption with long termenergy forecast, the development in the power sector was depictedand two key points were identified to secure future power supply inMalaysia. First, diversification of energy sources in the energy mix isimportant to maintain stable energy production. Second, improve-ment of the energy policy, implementation of new energy policy,power expansion plan and consideration of new energy sourcemust be regularly revised to avoid dependency on individual energysource and provide sustainable power generation.

Expanding and upgrading the existing power plants is the bestsolution to fulfill power demand in a short term period. However,for longer term, Malaysia needs stable supply of energy sources inthe energy mix. Renewable energy is one of the best alternativesthat will play vital roles in Malaysia's energy mix in the future dueto the abundance of renewable energy resources in Malaysia. Thecontribution of RE to the mix has improved after the implementa-tion of FiT scheme, while nuclear energy is still under carefulconsideration by the government.

It is clear that further development of depleting fossil resources(like coal, gas and oil) for electricity generation in Malaysia willresult in more emission of GHG and will hinder Malaysia fromachieving its target of reducing carbon emission to the environ-ment. To achieve this target, the government has to reconsider itspower sector expansion plan which favors the use of more coaland gas as fuel for electricity generation.

Acknowledgments

We would like to thank the Ministry of Higher Education,Malaysia (MOHE) and Universiti Teknologi Malaysia for providinga research grant (GUP – Q.J.130000.7126.03H67) and Zamalah

scholarship for this research. This work was also supported bythe Research Management Center (RMC) of Universiti TeknologiMalaysia through its Post-Doc Fellowship for the third author,under the research grant (Q.J130000.21A2.01E98).

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