Energy policy of Malaysia

Government-linked companies Petronas and Tenaga Nasional Berhad are major players in Malaysia's energy sector.

In pursuit of the supply objective, policy initiatives, particularly with respect to crude oil and natural gas, Malaysia have aimed at both extending the life of domestic non-renewable energy resources, as well as diversification away from oil dependence to include other forms of energy sources.

Demand side management initiatives by the utilities, particularly through tariff incentives, have had some impact on efficient utilisation and consumption.

All major energy development projects are subjected to the mandatory environmental impact assessment requirement.

The policy, which was set out in 2001, had a target of renewable energy providing 5% of electricity generation by 2005, equal to between 500 and 600 megawatt (MW) of installed capacity.

Numerous applications for the program have been received, mainly involving biomass, and of these over half are for palm oil waste.

[6][7] In 2016, the Sustainable Energy Development Authority (SEDA) of Malaysia has conducted a comprehensive onshore wind mapping effort.

[9] As of 2021, Malaysia is one of the major producers of solar panels in the world, but paradoxically it has yet to fully capitalize on this for domestic electricity generation.

[2]: 9 All figures are in Megawatts Source: Suruhanjaya Tenaga (Energy Commission) Annual Report[19][20] All figures are in megawatts Source: Suruhanjaya Tenaga Annual Report [19][20] Energy use per person is relatively high in Malaysia compared to other upper-middle-income countries such as Brazil, Turkey or China.

[23] Local governments are also showing leadership on energy efficiency policies: Putrajaya has the aspiration of becoming a "Green City" by 2025,[24] while Iskandar Malaysia has developed a "Low-Carbon Society Blueprint".

[25] There are significant opportunities to improve energy efficiency in urban areas, where 73% of Malaysia's population live.

[27] Johor Bahru, for example, could reduce its emissions by a quarter by 2025 through a range of cost-effective investments: switching from diesel to natural gas in the rubber and petrochemical industries, promoting hybrid cars, adopting more ambitious green building standards and introducing mandatory energy performance standards for appliances such as air conditioners.

For example, the Electricity Regulation 1994 has introduced labelling systems and performance standards for air conditioners, refrigerators, domestic fans and televisions.