- Malaysia says it will increase renewable energy ambition to about 70% of the national electricity mix by 2050
- It would require an investment of MYR 637 billion between 2023 and 2050 and lead to 11-fold improvement
- Increased clean energy generation capacity will bring down its dependence on fossil fuels and bring down electricity bills
- Malaysia will also end barriers to energy trade to benefit as a power exporter to neighbors as Singapore
Malaysia may just become a star solar market in Southeast Asia as the government has announced it will increase its renewable energy target for 2050 to about 70% of the national electricity mix, while also ending cross-border trade barriers for renewable energy.
In an announcement on its Twitter account, the country’s Ministry of Economy said this increase in renewable energy capacity will translate into an 11-fold improvement in its capacity from 2023 to 2050 for which it estimates an investment of MYR 637 billion ($143 billion). The amount needs to be also spent on grid infrastructure, energy storage system integration and network system operating costs.
It has already ‘immediately’ allocated MYR 50 million ($11.2 million) to install rooftop solar systems for government facilities across the country over the next 6 months, said the Economy Minister Rafizi Ramli.
While specific capacity targets have not been shared so far, solar is likely to be a big part of the mix as the policies will encourage renewable energy implementation through self-consumption model for industrial parks and homes. Energy storage addition will also be encouraged to reduce dependence on fossil fuels.
Increase in clean energy capacity will create new economic opportunities for the country, attract global players and especially firms with RE100 commitment, and also bring down electricity bills for the government.
Cross-border renewable energy supply will be made through an electricity exchange system to be set up by the government.
The decision to cancel trade barriers, explained the ministry, is expected to benefit local companies to build renewable energy capacity on a larger scale, taking advantage of high energy demand from its neighbor Singapore.
According to the International Renewable Energy Agency (IRENA), Malaysia’s renewable energy share in the final energy mix was 5% in March 2023. In its latest Malaysia Energy Transition Outlook report published in collaboration with the country’s Ministry of Natural Resources, Environment and Climate Change (NRECC), analysts see solar PV as a key technology to lead Malaysia’s energy transition regardless of the scenario, with up to 150 gigawatts of installed capacity required up to 2050’.
At the end of 2022, Malaysia’s total installed renewable energy capacity was 9.04 GW out of which solar’s share was 1.93 GW.
In June 2021, the Malaysian government had said the country aims to achieve 18 GW cumulative renewable energy capacity by 2035 (see Malaysia Aims For 31% RE Installed Capacity By 2025).