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Solar Thermal Deployment Strategy for Malaysian Industries SUMMARY VERSION Policy Brief MALAYSIA ENERGY EFFICIENCY & SOLAR THERMAL APPLICATION PROJECT (MAEESTA)

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Page 1: Policy Brief - MAEESTA

Solar Thermal Deployment Strategy for Malaysian IndustriesSUMMARY VERSION

Policy Brief

M A L A Y S I A E N E R G Y E F F I C I E N C Y & S O L A R T H E R M A L A P P L I C AT I O N P R O J E C T ( M A E E S T A )

Page 2: Policy Brief - MAEESTA

Policy Brief : Solar Thermal Deployment Strategy for Malaysian Industries / Malaysia Energy Efficiency & Solar Thermal Application Project (MAEESTA) –

Summary Version

ISBN 978-967-13297-9-5

1. Solar thermal energy – Malaysia.2. Solar energy industries – Malaysia.

3. Industrialization – Energy consumption.4. Solar energy – Malaysia.

5. Government publications – Malaysia.

I. United Nations Industrial Development Organization. Malaysia Energy Efficiency & Solar Thermal Application Project.

333.792309595

Published by: Malaysian Science and Technology Information Centre (MASTIC), MOSTI

Printed by: Dolphin Press Sdn Bhd (803493-W)

©️ UNIDO 2021. All rights reserved.

This document has been produced without formal United Nations editing. The designations employed and the presentation of the material in this document do not imply the expression of any opinion whatsoever on the part of the Secretariat of the United Nations Industrial Development Organization (UNIDO) concerning the legal status of any country, territory, city or area or of its authorities, or concerning the delimitation of its frontiers or boundaries, or its economic system or degree of development. Designations such as “developed”, “industrialized” or “developing” are intended for statistical convenience and do not necessarily express a judgement about the stage reached by a particular country or area in the development process. Mention of firm names or commercial products does not constitute an endorsement by UNIDO.

Page 3: Policy Brief - MAEESTA

Foreword MOSTI for Policy Brief: Solar Thermal Deployment Strategies for Malaysian Industries ....... 2

Acknowledgement ......................................................................... 3

Executive Summary ....................................................................... 7

Background .................................................................................. 8

List of Abbreviations ...................................................................... 9

Solar Thermal Market Analysis for Malaysian Industries .................. 10

Solar Thermal Deployment Strategy For Malaysian Industries .......... 15

Introduction .................................................................................. 16

Policy and Regulatory ................................................................ 18

Financial ................................................................................... 21

Awareness and Capacity Building .............................................. 25

Testing, Certification and Standardisation .................................. 29

Technology and R&D ................................................................. 32

ANNEX .......................................................................................... 38

Contents

Page 4: Policy Brief - MAEESTA

Foreword fr0m MOSTI

Malaysia has committed to a reduction of greenhouse gases by 45% by the year 2030 relative to its emissions intensity of GDP in 2005 as specified in its Intended Nationally Determined Contribution (INDC). In achieving this target, a long-term commitment from all stakeholders, businesses, civil society, and people is required. The Malaysian government together with United Nations Industrial Development Organization (UNIDO) through the Malaysia Energy Efficiency and Solar Thermal Application Project (MAEESTA) have taken a great initiative to promote solar thermal technology for industrial and commercial use in Malaysia to reduce their dependency on conventional fossil fuels.

Outcome from a study on ‘Solar Thermal Market Analysis for Malaysian Industries’ projects that Malaysia has a solar thermal potential capacity deployment of 939 MWTh by 2025. In materialising this potential target, a strategic deployment plan and implementing framework must be developed, which was then established through activities of Solar Thermal Deployment Strategy for Malaysian Industries. This exercise was conducted to further assess the key interventions featured in the Solar Thermal Market Analysis study and identify strategic instruments considering the current scenarios and challenges. The moving forwards are presented in 3 phases; Phase 1(2020-2022), Phase2 (2023-2025) and Phase 3 (Beyond 2025) covering five key areas; 1) policy and regulatory, 2) financing, 3) awareness and capacity building, 4) testing, certification and standardisation and 5) technology and R&D.

MOSTI with its function to promote science, engineering and technology, in this regard plays important roles to support the research and development of solar thermal technology. As highlighted in the Solar Thermal Deployment Strategy document, more pilot projects should be developed in highlighting technological advancement and performance, best practices and economic viability. Such demonstration projects help in knowledge dissemination through better understanding of the technology, its applicability, reliability and benefits. Integrating digitisation and automation in solar thermal system and industrial process will assist on data collection, monitoring and control hence improve the efficiency and performance of the system.

The success of solar thermal deployment in Malaysia’s industries draws upon effective cross-sectoral collaboration across various sectors to maximise its potential benefits. The conventional way of driving the technology growth agenda shall be replaced by dynamic engagement between industry/private and research institutions to work together for undertaking various R&D projects.

Puan Nordina Binti IdrisChairmanSolar Thermal Deployment Plan CommitteeUnder SecretaryMinistry of Science, Technology and Innovation (MOSTI)

Page 5: Policy Brief - MAEESTA

Policy Brief: Solar Thermal Deployment Strategy for Malaysian Industries | 3

Solar Thermal Deployment Strategy for Malaysian Industries further assesses the key interventions featured in the Solar Thermal Market Analysis study and identifies suitable instruments and enablers, challenges and the way forward for implementation of solar thermal technology.

This document reflects a consolidated viewpoint from numerous stakeholders – ministries, government agencies, industries, associations, external consultants, academic institutions and multilateral/bilateral organisations. The extensive rounds of workshops, discussions, meetings and interviews held provide an appropriate path to reach the target audiences and cater to their demands.

Mr. Sanjaya ShrestaIndustrial Development Officer/Project ManagerUNIDO HQ, Vienna

Miss Marlene SayerProject AssociateEnergy Systems and Infrastructure DivisionUNIDO HQ, Vienna

Dr. Azmi Hj. IdrisNational Project ManagerProject Management UnitUNIDO MAEESTA

Mrs. Hasimah HasanAssistant National Project ManagerProject Management UnitUNIDO MAEESTA

Mr. Mohammad Iskandar MajidiSenior Technical ExpertProject Management UnitUNIDO MAEESTA

Appreciation From

Mr. Ahmad Zakuan Ahmad DahalanProject Technical ExpertProject Management UnitUNIDO MAEESTA

Mr. Mohd Arief Firdaus Mohd YusofProject Technical ExpertProject Management UnitUNIDO MAEESTA

Mr. Ahmad Zafuan Mohamed KassimNational ExpertProject Management UnitUNIDO MAEESTA

Ir. Luk Chau BengBoiler ExpertProject Management Unit UNIDO MAEESTA

The Solar Thermal Deployment Strategy would not have been possible without the collaborative and tireless efforts of the Solar Thermal Deployment Committee that was formed by the National Project Steering Committee (NPSC) to provide guidance and review the deployment strategy exercises.

Overall production and development of the Solar Thermal Deployment Strategy for Malaysian Industries which was then led by MESTECC (now MOSTI) and executed by the Universiti Teknologi MARA (UiTM) policy consultant and United Nations Industrial Development Organization (UNIDO), under the Malaysia Energy Efficiency and Solar Thermal Application Project (MAEESTA).

Acknowledgement

Page 6: Policy Brief - MAEESTA

4 | Policy Brief: Solar Thermal Deployment Strategy for Malaysian Industries

• Ministry of Science, Technology and Innovation (MOSTI)¹

• Ministry of Energy and Natural Resources (KeTSA)¹

• Ministry of Environment and Water (KASA)²• Economic Planning Unit (EPU)• Ministry of International Trade and Industry

(MITI)• United Nation Industrial Development

Organization (UNIDO)• Sustainable Energy Development Authority

(SEDA)

• Energy Commission (EC)• Malaysian Investment Development Authority

(MIDA)• SIRIM Berhad • Malaysia Green Technology and Climate

Change Centre (MGTC)• Solar Energy Research Institute (SERI-UKM)• Federation of Malaysian Manufacturers (FMM)• SME Corporation Malaysia (SME Corp)

Chair:Puan Nordina Binti IdrisSolar Thermal Deployment Plan CommitteeUnder SecretaryMinistry of Science, Technology and Innovation (MOSTI)

Policy Consultant• Assoc. Prof. Ir. Dr. Nofri Yenita Dahlan

Assistant Policy Consultant• Dr. Siti Mariam Mohd Shokri

Members• Prof. Ir. Dr. Zuhaina Zakaria• Assoc. Prof. Ir. Dr. Ahmad Farid Abidin• Assoc. Prof. Ir. Dr. Hasmaini Mohamad• Assoc. Prof. Ir. Dr. Nur Ashida Salim• Dr. Zuhaila Mat Yasin• Mrs. Yusnira Husaini• Mrs. Anis Sabirin Baharom• Miss Norlee Husnafeza Ahmad

National Project Steering Committee (NPSC)

Solar Thermal Deployment Plan Committee

Universiti Teknologi MARA (UiTM) Policy Consultant Team

Members:• Ministry of Science Technology and

Innovation (MOSTI)¹• Ministry of Energy and Natural Resources

(KeTSA)¹• Ministry of Environment and Water (KASA)²• Economic Planning Unit (EPU)³• Ministry of International Trade and Industry

(MITI)• Malaysia Green Technology and Climate

Change Centre (MGTC)⁴• Malaysian Investment Development Authority

(MIDA)• Energy Commission (EC)• Sustainable Energy Development Authority

(SEDA)• SIRIM Berhad• Federation of Malaysian Manufacturers (FMM)• Universiti Teknologi MARA (UiTM)• Solar Energy Research Institute (SERI), UKM

1 Previously known as Ministry of Energy, Science, Technology, Environment and Climate Change (MESTECC)2 Previously known as Ministry of Energy, Green Technology and Water (KeTTHA) / Ministry of Energy, Science, Technology, Environment and

Climate Change (MESTECC)3 Previously known as Ministry of Economic Affairs (MEA)4 Previously known as Malaysia Green Technology Corporation

Page 7: Policy Brief - MAEESTA

Policy Brief: Solar Thermal Deployment Strategy for Malaysian Industries | 5

• Mrs. Hartini Mohd NasirMinistry of Environment and Water (KASA)

• Mr. Wong Tin SongMinistry of Energy and Natural Resources (KeTSA)

• Mrs. Zamzurina ZulkifliMinistry of Energy and Natural Resources (KeTSA)

• Mrs. Hizahwati BadriMinistry of Science, Technology, and Innovation (MOSTI)

• Mr. Sabar Md HashimEconomic Planning Unit (EPU)

• Mr. Mohamed ZamaniMinistry of International Trade and Industry (MITI)

• Mr. David Hew Chenn ChingMalaysian Investment Development Authority (MIDA)

• Miss Zabidah DaudMalaysian Investment Development Authority (MIDA)

• Dr. Ab Wahab Che MatMinistry of Education (MOE)

• Mrs. Norasiah BaharmazidinMinistry of Education (MOE)

• Mr. Abdul SyafiqMinistry of Education (MOE)

• Ir. Noor Muhammad Abd RahmanMinistry of Health (MOH)

• Mr. Haniff NgadiSustainable Energy Development Authority (SEDA)

• Mr. Ashaary KusniSustainable Energy Development Authority (SEDA)

• Mr. Zulkiflee UmarEnergy Commission (EC)

• Mr. Mohamed Nadhir Zainal AbidinEnergy Commission (EC)

• Mr. Mohammad Faiz Mohd YusoffEnergy Commission (EC)

• Mrs. Azlina HashimMalaysia Green Technology and Climate Change Centre (MGTC)

• Mr. Mohd Khairil RumliMalaysia Green Technology and Climate Change Centre (MGTC)

• Mr. Malik AtanMalaysia Green Technology and Climate Change Centre (MGTC)

• Mr. Hammad A. AinuddinMalaysia Green Technology and Climate Change Centre (MGTC)

• Mr. Nik Mohd Haikal Mohamed Shafie Malaysia Green Technology and Climate Change Centre (MGTC)

• Mr. Mohd Fauzi IsmailSIRIM Berhad

• Mr. Abd Aziz LongSIRIM Berhad

• Mr. Azizi AhmadSIRIM Berhad

• Mrs. Mashitah JaafarSIRIM Berhad

• Mrs. Sharifah JusohSIRIM Berhad

• Mr. Muhamad Iskandar Shah BachekSIRIM Berhad

• Dr. Rohaya Md ZainSIRIM Berhad

• Mr. Lee Chee YouDepartment of Statistics Malaysia (DOSM)

• Mrs. Navina BalasingamSecurity Commission (SC)

• Mr. Azreen FirdausMalaysian Industry-Government Group for High Technology (MIGHT)

• Mr. Syed Mahathir Syed Azman ShahDepartment of Skills Development (JPK)

• Mr. Sharul Sazman SamaanMalaysia Debt Venture (MDV)

• Dr. Azli Abd RazakUniversiti Teknologi MARA (UiTM)

• Ir. Ts. Dr Baljit SinghUniversiti Teknologi MARA (UiTM)

• Dr. Zarina Ab MuisUniversiti Teknologi Malaysia (UTM)

• Dr. Adnan IbrahimSolar Energy Research Institute (SERI-UKM)

• Miss Tracy Yip Chooi PinPricewaterhouse Coopers (PwC)

• Dr. Ir. Philip TanFederation of Malaysian Manufacturers (FMM)

• Mrs. Wan Haslina Wan Mohd HussinFederation of Malaysian Manufacturers (FMM)

• Mr. Tan Lim Soon FuEPC Block Chain

• Mr. Amirul Afiq DahlanRADICARE

Workshop Participants

Page 8: Policy Brief - MAEESTA

6 | Policy Brief: Solar Thermal Deployment Strategy for Malaysian Industries

• Mr. Raihan Abu BakarTenaga Nasional Berhad (TNB)

• Mr. Mohd Najib MohamadTNB Energy Services Sdn. Bhd.

• Mr. Antony WeeGreen Solar Energy

• Mr. Mohamad Shahir Abdul KadirSolar District Cooling Sdn. Bhd.

• Mr. Bryan TeohSolar District Cooling Sdn. Bhd.

• Mr. Azhar Md IsninZamatel Sdn. Bhd.

Page 9: Policy Brief - MAEESTA

Policy Brief: Solar Thermal Deployment Strategy for Malaysian Industries | 7

List of Abbreviations

ASEAN Association of South East Asian Nations

COP Coefficient of Performance

EE Energy Efficiency

EECA Energy Efficiency Conservation Act

EMIS Energy Management Information System

EPC Energy Performance Contracting

ESCO Energy Service Company

FMM Federation of Malaysian Manufacturers

GEF Global Environment Facility

GHG Greenhouse Gas

GITA Green Investment Tax Allowance

GITE Green Income Tax Exemption

GTFS Green Technology Financing Scheme

GW Gigawatt

GWh Gigawatt hour

GWth Gigawatt thermal

HUKM Hospital Universiti Kebangsaan Malaysia

ICP Investor Confidence Project

IRDA Iskandar Regional Development Authority

IREE International Review of Electrical Engineering

JPK Department of Skills Development

LKIM Lembaga Kemajuan Ikan Malaysia

KASA Ministry of Environment and Water

KeTTHA Ministry of Energy, Green Technology and Water

KeTSA Ministry of Energy and Natural Resources

KPM Kementerian Pendidikan Malaysia

Kton Kilotonnes

KTP Knowledge Transfer Program

LPG Liquefied Petroleum Gas

MAEESTA Malaysia Energy Efficiency and Solar Thermal Application Project

MDV Malaysia Debt Ventures Berhad

MESTECC Ministry of Energy, Science, Technology, Environment and Climate Change

MGTC Malaysian Green Technology and Climate Change Centre

MIDA Malaysian Investment Development Authority

MITI Ministry of International Trade and Industry

MOHE Ministry of Higher Education

MOSTI Ministry of Science, Technology, and Innovation

MW Megawatt

MWth Megawatt thermal

M&V Measurement and Verification

NCS National Competency Standard

NEEAP National Energy Efficiency Action Plan

NOSS National Occupation Skills Standard

NPSC National Project Steering Committee

NREAP National Renewable Energy Action Plan

PV Photovoltaic

RE Renewable Energy

RETR Renewable Energy Transition Roadmap

RM Malaysia Ringgit

ROI Return of Investment

RTC Renewable Thermal Collaborative

SEDA Sustainable Energy Development Authority

SERI Solar Energy Research Institute

SME Small and Medium Scale Enterprises

TNB Tenaga Nasional Berhad

UKM Universiti Kebangsaan Malaysia

UNIDO United Nations Industrial Development Organization

Page 10: Policy Brief - MAEESTA

8 | Policy Brief: Solar Thermal Deployment Strategy for Malaysian Industries

SEDATraining Module & Certificate

UniversitiesThermal & Solar Thermal Data:

Case Studies & Suppliers

SEDAOnline Data &

Monitoring

Energy CommissionThermal Energy Guidelines

SIRIM STSIndustrial Standards

Training module and certificate using local experts trained under UNIDO Programme for the thermal energy efficiency and solar thermal technology & design.

Develop the national competency and skills certificate for thermal energy efficiency and solar thermal technology.

Develop Online Solar Thermal Monitoring System for project mapping and data references for public

Work with universities and government agencies for thermal energy data, supply chain data and available project showcases on solar thermal technology.

Establish related thermal energy guidelines for the appropriate and higher quality of practices on audit procedures and energy management systems

Establish industrial standards for thermal energy efficiency and solar thermal technology

MOHRCompetency

Solar Thermal Deployment Strategy for Malaysian Industries further evaluate the five key areas of intervention underlined by the Solar Thermal Market Analysis comprises of:1) Policy and regulatory2) Financial3) Awareness and capacity building4) Testing, certification and standardisation and5) Technology and R&D

The Solar Thermal Deployment Strategy aims to identify suitable instruments and enablers in light of the status quo, challenges and way forward for strategic implementation. The deployment plan’s timeframes cover Phase 1: short-term (2020–2022), Phase 2: medium-term (2023–2025) and Phase 3: long-term (beyond 2025).

Collaboration between UNIDO and relevant agencies will be established to execute the on-the-ground activities for supporting solar thermal growth in 2020–2022. These include developing certified training modules and competency-based solar thermal training programmes

to enhance capacity buildings among the industries and stakeholders. Additionally, thermal energy guidelines and industrial standards related to thermal energy efficiency and solar thermal technology will be established to assist the industry in design, installation, operation and maintenance and performance measurement. Digital online monitoring system for the existing solar thermal plants will be developed as a data sharing platform that can be used for technology showcases as well as policy development.

Greater extent of strategic deployment planning is highlighted in this document for medium- and long-term solutions. This will be mainly implemented after specific policy for thermal energy in Malaysia has been in place. In ensuring success of the programmes, UNIDO will jointly collaborate with various agencies particularly Sustainable Energy Development Authority (SEDA), Ministry of Human Resources (MOHR), Energy Commission, SIRIM, and academic institutions.

Executive Summary

Page 11: Policy Brief - MAEESTA

Policy Brief: Solar Thermal Deployment Strategy for Malaysian Industries | 9

Solar Thermal Deployment Strategy for Malaysian Industries is inspired by the solar thermal potential target and the key output highlighted in the Solar Thermal Market Analysis for Malaysian Industries. The deployment of targeted solar thermal capacity will have multi-faceted benefits in terms of economic, social and environmental aspects. The target of 939 MWth solar thermal installed capacity by 2025 would entail an investment of RM 1.54 billion over a period of 2019–2025 and result in 3.8% industrial energy consumption savings. Malaysia would also save a total of RM 326.9 million of fuel annually, reduce 763 kton CO2-eq emission that contribute to 0.19% reduction of COP21 target and create 6,120 jobs opportunity. A bigger potential of solar thermal installation in Malaysia can be achieved using advanced solar thermal technology that can be used for industrial process heat covering medium temperature (100°C – 250°C) which require a bigger investment.

In realising the target and many-sided benefits to Malaysian industry, a strategic solar thermal deployment plan was aspired. The market analysis has extensively proposed various key recommendations to be considered for deployment, however details on how and when to implement yet to be consulted. Consequently, Solar Thermal Deployment Strategy for Malaysian Industries was performed to further assesses the various key recommendations proposed in the Solar Thermal Market Analysis that comprises the five key areas:1) Policy and regulatory2) Financial3) Awareness and capacity building4) Testing, certification and standardisation and5) Technology and R&D

The Solar Thermal Deployment Strategy for Malaysian Industries is a strategic document capturing the insights of all the target audiences, comprising of all major government stakeholders, international players, solar technology experts, technology associations, service/technology providers, analytical experts, industrial associations, research institutions, educational universities and various other entities involved in the field. The deployment strategy contains extensive stakeholders’ view and discussion of the key interventions highlighted in the Solar Thermal Market Analysis in light of the existing business cases, challenges and way forward for strategic interventions with timeline approach. The overall deployment strategy has been strengthened by incorporating regular feedback from the Solar Thermal Deployment Committee and capturing ground realities by means of stakeholder workshops, one to one meetings with relevant agencies and stakeholders’ feedback session on the key output of the deployment strategic plan.

The overall exercises comprise of three main activities:1) Formation of solar thermal deployment

committee2) Stakeholders’ workshops and3) Development of policy input document.

Background

Page 12: Policy Brief - MAEESTA

SOLAR THERMAL MARKET ANALYSIS

FOR MALAYSIAN INDUSTRIES

Page 13: Policy Brief - MAEESTA

Policy Brief: Solar Thermal Deployment Strategy for Malaysian Industries | 11

The cumulative solar thermal energy potential in industries, hotels and hospitals is 7.955GWh in Malaysia. This translates to a solar thermal capacity potential of around 4.86GWth, with 4.39GWth for heating and 0.47GWth for space cooling purposes. It further translates to a collector area potential (considering 0.7kWth/m²) of around 6.9 million m².

Solar Thermal Energy Potential

IndustryWater Heating Space Cooling

TotalHotels Hospitals Hotels Hospitals

Equivalent input energy (GWh) 186,297 222 84 817 369 187,789

Solar thermal energy potential (GWh) 7,042 104 36 548 225 7,955

Solar thermal capacity potential (MWth) 4,300 64 22 334 137 4.857

Collector area (m²) 6,125,000 91,500 31,500 477,100 195,800 6,920,900

Considering the current trend of solar thermal installations and experiences of other countries, a penetration of 20% of the overall potential can be targeted for heating applications. For cooling applications, a penetration of 10% has been considered due to the higher cost and complexity of the technology.

4.86 GWth 6.9 million m² 3.8% 10% / 20%

Solar Thermal Capacity Potential

Solar Thermal Capacity Potential

Solar Thermal Collector Area

Potential

Proportion of Industrial

Energy Consumption

Penetration Factor for Cooling / Heating

Page 14: Policy Brief - MAEESTA

12 | Policy Brief: Solar Thermal Deployment Strategy for Malaysian Industries

A cumulative deployment of 939MWth solar thermal units of capacity by 2025, out of which 839MWth will be deployed for heating requirements and 54MWth will be deployed for space cooling requirements. Furthermore, this translates into an overall collector area deployment of 1,341,429 m².

Solar Thermal Deployment Targets Till 2025Proposed Annual Solar Thermal Deployment Targets – MWth

Sectors % Penetration Market Potential (MWth) Target (MWth) Final Target till 2025

(MWth)

Industry 20% 4,300 860 860

Hotel – Heating 20% 64 12.8 13

Hospital – Heating 40%/20% 22 7.7 8

Hotels & Hospitals – Space Cooling 20%/10%  471 57.4 58

Total 939

21 2141.5

77

128

235

357.5

2 2 3 5 8 15 230

50

100

150

200

250

300

350

400

2019 2020 2021 2022 2023 2024 2025

Heating Cooling

Estim

ated

Dep

loym

ent i

n M

W

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Policy Brief: Solar Thermal Deployment Strategy for Malaysian Industries | 13

Energy saving (% of Industrial Energy Consumption)

Overall FinancialInvestment(RM billion)

0.8%

Fuel Saving as % of Malaysia Subsidy Share

Yearly Fuel Savings – Industry (RM million)

No of People Employed

Cost of CO₂ Saved(RM/kg-CO₂)

COP21 CO₂Reduction

Realization

Annual GHGEmission Reduction

(kton CO₂-eq)1.4%

KEYOUTPUTS

326.9

6,1200.34

0.19%

763

1.54

The deployment of targeted solar thermal capacity will have multifaceted benefits in terms of economical, social and environmental impact. The target would entail an investment of RM1.54 billion from 2019–2025, and would result in a 3.8% savings on industrial energy consumption. This would translate into an annual saving of RM326.9 million for industries and also reduce the fuel subsidy burden of Malaysia by 1.4%. On the environmental front, this would lead to a yearly emissions reduction of 763 kilotons CO2-eq,

Key Output of Solar Thermal Market Analysis for Malaysian Industries

which will help plug a significant portion of national CO2 reduction targets such as the 0.19% of COP21 target. Solar thermal has the lowest cost of CO2 avoided – RM 0.34/kg-CO2, among all prevalent renewable energy sources, and thus has the potential to achieve sustainability targets of Malaysia in the most economical manner. The targeted deployment will also result in a creation of 6,120 jobs in manufacturing, installation, design and maintenance of solar thermal technologies.

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14 | Policy Brief: Solar Thermal Deployment Strategy for Malaysian Industries

Key Recommendations of Solar Thermal Market Analysis for Malaysian Industries

Recommendations of Solar Thermal Market Analysis

Awareness and Capacity Building• Increasing awareness amongst industries, financial and educational institutions• Creating a knowledge portal• Developing a solar thermal training programme• Creating a solar thermal apprenticeship programme• Developing a monitoring and training framework• Utilising collaboration opportunities with existing departments/ programmes

Financial• Addressing concerns over unattractive paybacks and overall financial viability• Availability of standardised documentation and financial model• Fiscal incentives in the form of capital subsides and rebates• Financial support in the form of tax incentives and soft loans• Implementing an aggregator model.

Policy and Regulatory• Developing solar thermal policy and target setting• Developing solar thermal mandates through regulations• Introducing innovative policy models/decision making similar to solar PV• Forming solar thermal alliance/platform• Creation of a perform and reward mechanism

Technology and R&D• Developing new R&D thrust areas• Focussing on commercialisation of technology – mapping industrial needs• Undertaking pilot and demonstration projects• Developing leadership and management: solar thermal coordination body• Developing strategic tie-ups/R&D partnerships• Developing a priority based roadmap and timelines

Testing, Certification and Standardisation• Empanelling suppliers, bringing in more transparency and visibility• Establishing dedicated solar thermal standards• Focusing on improving solar thermal auditing framework• Measuring performance related data and establishing dedicated standards for performance.