Sustainability Development through Energy Efficiency Initiatives in Malaysia

©15-ICIT 26-28/7/11 in Malaysia ST-4: Green & Energy Management Paper #: 04-05 P- 1 of 12

Sustainability Development through Energy Efficiency Initiatives in Malaysia

Dr.Tan Ching Sin1

Institute of Energy Research and Policy (IEPRe), University Tenaga Nasional

[email protected]

Suhaida Bte Mohd Sood

Institute of Energy Research and Policy (IEPRe), University Tenaga Nasional [email protected]

Dr Leong Yow Peng

Institute of Energy Research and Policy (IEPRe), University Tenaga Nasional [email protected]

ABSTRACT Development of energy sector in Malaysia is guided by three principal objectives of the National Energy Policy which was introduced in 1979, that is supply objective, utilization objective and environmental objective. The aim of the utilization objective is to promote efficient utilization of energy and discourages wasteful and non-productive patterns of energy consumption. The Malaysia government’s approach towards realizing this objective is to focus on improving energy efficiency in the industry sector and to encourage efficiency in energy production, transportation, conversion, utilization as well as consumption through various awareness programmes. In order to reduce inefficiency and wasteful use of energy in industrial facilities there is a need for the Government to work with the industry and promote energy efficiency (EE) in industrial facilities. Along these lines, a number of industrial energy efficiency initiatives are being planned and this includes the energy auditing programmes, energy services companies support programmes and technologies demonstration programmes. This paper looks into the key issues and challenges of EE development, action plans and implementations undertaken in Malaysia and identifies broad strategies which can be catalysts for EE initiatives in Malaysia. Keywords: Energy Efficiency, Sustainable Development, Energy Policy 1.0 Introduction of Sustainable Development

Sustainable development is widely recognized by all leaders in the world. It has been a common topic of discussion by academia and industrial. It started 30 years back. The mainstream of sustainable development was progressively developed through the World Conservation Strategy (1980), the Brundtland Report (1987), and the United Nations Conference on Environment and Development in Rio (1992). The aim of the World Conservation Strategy is to help advance the achievement of sustainable development through the conservation of living resources and provide policy guidance on how sustainable development can be carried out (IUCN, 1980). The strategy is intended for three main groups of user namely;

� government policy makers and their advisors, � conservationists and others directly concerned with living resources

1 Corresponding author: Tel: +603-8921 2378 Email address: [email protected]


� Development practitioners including development agencies, industrial and commerce and trade unions.

The Brundtland Commission of the United Nations, formally the World Commission on Environment and Development (WCED) was created to address growing concern "about the accelerating deterioration of the human environment and natural resources and the consequences of that deterioration for economic and social development". The Brundtland Commission's report in 1987, defined sustainable development as "development which meets the needs of current generations without compromising the ability of future generations to meet their own needs"(Brundtland Report, 1987). The United Nations Conference on Environment and Development in Rio de Janeiro from 3 to 14 June 1992 also known as Rio Summit, Rio Conference and The Earth Summit has resulted in several documents and declarations (UNCED, 1992) Among others,

� Rio Declaration on Environment and Development � Agenda 21 � Convention on Biological Diversity � Forest Principles � Framework Convention on Climate Change (UNFCCC)

Their aims are to meet the challenges of global warming, pollution, biodiversity and the inter-related social problems of poverty, health and population. Hence, the integration of environment and development concerns will lead to the fulfillment of basic needs, improved standards for all, better managed and protected ecosystems for a brighter future. Therefore, global partnership for sustainable development is a must as no nation can achieve sustainable development on its own. At the 2005 World Summit, sustainability was redefined as a reconciliation of environmental protection, social progress and economic growth. These three dimensions is best illustrated using the interlocking circles model to demonstrated the integration of three dimensions with action to redress the balance between dimensions of sustainability. These three circles of sustainability were shown as mutually beneficial and reinforcing factors. Figure 1: Overlapping/interlocking circles of Sustainable Development (W.M. Adams, 2006)

Most of the modern societies are in the midst of changing from petroleum dependent to a much more diverse mix of energy sources. However, managing this transition is a major challenge as it may bring substantial risks to biodiversity and human well-being. Therefore, it is very important to identify the impacts of various alternatives energy on biodiversity and designing an appropriate policy measure to ensure appropriate governance and demonstrating how biodiversity can be conserved. Technology will be one of the critical issues during the transition from the ‘old economy’ (fossil fuel) to the ‘new economy’ (reuse, recycle, new energy). New technologies may be the key to substantial improvements in energy intensity.


2.0 Generation Fuel Mix in Malaysia There are three main electric utilities in Malaysia, Tenaga Nasional Berhad (TNB), Sabah Electricity Sdn. Bhd (SESB) and Sarawak Electricity Berhad (SEB). At the same time the electricity supply industry in Malaysia was partly liberalized with the introduction of Independent Power Producers (IPPs). Figure 2 shows the electricity generation in 1980 was predominantly from oil, however, since 1990 the share of electricity generation came from natural gas and also the share of coal is increasing rapidly. This indicates a successful reduction in the overall dependence on crude oil with the introduction of Four Fuel Diversification Policy in 1981. However, with the increase of power demand, more electricity power generation will be required. There are many reasons for the increased reliance on natural gas and coal, one of the reasons is because of security of supply. While coal is seen as the cheapest fossil fuel for generating electricity, it is also the dirtiest because of it highest levels of pollutants into the environment. Hence new technology will allowed natural gas and coal to play an increasingly important role in the clean generation of electricity as well as better energy efficiency production. Figure 2: Electricity Generation Fuel Mix in Malaysia (1980-2008)

Source: National Energy Balance

3.0 Energy Policies in Malaysia

Over the years, Government of Malaysia has formulated several policies and action plans to address her energy concerns. The development of Energy policies in Malaysia started since 1975 with the introduction of National Petroleum Policy in 1975. This is then followed by the formulation of National Energy Policy of Malaysia in 1979 with the three main objectives of ensuring sufficient and reliable supply of energy, promoting efficient utilization of energy and reducing the negative impact of energy production on the environment. The latest National Policy on Climate Change launched in 2009 also highlights the Energy Efficiency in the supply and demand sector. Table 1 summarizes various key energy policies and acts over the last three decades. Table 1: Energy-associated government policies and plans Policy/act Key emphasis

National Petroleum Policy (1975)

• Introduced to ensure optimal use of petroleum resources and regulation of ownership, management and operation, and economic, social, and environmental safeguards in the exploitation of petroleum due to fast growing petroleum industry in Malaysia

National Energy Policy (1979)

• Formulated with broad guidelines on long-term energy objectives and strategies to ensure efficient, secure and environmentally sustainable supplies of energy. It has Three main objectives:

• Supply objective: To ensure the provision of adequate, secure, and cost-effective energy supplies through developing indigenous energy resources both non-renewable and renewable energy resources using the least cost options and diversification of supply sources both from within and outside the country

• Utilization objective: To promote the efficient utilization of energy and to discourage


Policy/act Key emphasis

wasteful and non-productive patterns of energy consumption • Environment objective: To minimize the negative impacts of energy production,

transportation, conversion, utilization and consumption on the environment National Depletion Policy (1980)

• Introduced to safeguard against over exploitation of oil and gas reserves. Thus, it is production control policy

Four Fuel Diversification Policy (1981)

• Fuel diversification was designed to avoid over-dependence on oil as main energy supply and aimed at placing increased emphasis on gas, hydro and coal in the energy mix

Electricity Supply Act (1990)

• Regulates the licensing of electricity generation, transmission and distribution

Gas Supply Act (1993) • Regulates the licensing of the supply of gas to consumers through pipelines, prices, the control of gas supply pipelines, installations and appliances as well as safety

Five Fuel Diversification Policy (2001)

• Introduced in recognition of the potential of biomass, biogas, municipal waste, solar and mini hydro as potential renewable energy resources for electricity generation, SREP

Energy Commission Act (2001)

• The Energy Commission (or Suruhanjaya Tenaga) was established to provide technical and performance regulation for the electricity and piped gas supply industries, as the safety regulator for electricity and piped gas and to advise the government on matters relating to electricity and piped gas supply including energy efficiency and renewable energy issues.

• The Electricity Supply Act 1990 and Gas Supply Act 1993 have both been amended to allow the Energy Commission to take over these responsibilities

National Biofuel Policy (2006)

• Supports the five fuels diversification policy. Aimed at reducing the country’s dependence on depleting fossil fuels,

• Promoting the demand for palm oil. Five key thrusts: transport, industry, technologies, export and cleaner environment. Highlights: - Producing a biodiesel fuel blend of 5% processed palm oil with 95% petroleum

diesel - Encouraging the use of biofuel by giving incentives for providing biodiesel pumps

at fuelling stations - Establishing industry standard for biodiesel quality under Standards and Industrial

Research Institute of Malaysia (SIRIM) - Setting up of a palm oil biodiesel plant

The National Green Technology Policy (2009)

• Intensification of Green Technology research and innovation towards commercialization. • Strong promotion and public awareness of Green Technology. • Promotion of Green Building Index • Promotion of application of RE in commercial and residential buildings such as PV,

rainwater harvesting, phasing out of incandescent lights National Policy on Climate Change (2009)

• ST5-P2: Consolidate the energy policy incorporating management practices that enhances renewable energy (RE) and energy efficiency (EE).

• KA19 - ST5 : Promote RE and EE for power generation through: - Burden sharing between government and power producers; - Establishment of EE and RE targets/standards; - Inclusion of RE in generation mix by power producers; and - Promotion of RE generation by small and independent developers including local

communities.

4.0 Barriers to Energy Efficiency

The main barriers to implement energy efficiency (EE) among others include; 1. Limited knowledge or awareness of EE techniques and their economic benefits. 2. Limited access to information and benchmarks for EE technologies. 3. An unwillingness to incur what are perceived to be the ‘high-cost/high-risk’ transaction 4. Preference for industries to focus on investments in production rather than on efficiency 5. Lack of financier interested to finance EE investments 6. Insufficiently stringent regulations on EE standards and their implementation 7. Few EE technology demonstration projects by industry or government


8. Inadequate local energy support services and lack of trained industry and financial sector personnel in energy management

9. Large multinational corporations with production facilities in the country often feature state of art energy efficient design as a matter of course, but domestic industries, particularly the medium and small companies are less enterprising. Energy users are often reluctant to try out innovative solutions unless they are confident that claimed benefits are achievable. They may also have little need to use less energy if they can easily pass energy costs on to their customers.

Several action plans and measures have been taken by the Government of Malaysia to promote and improve energy efficiency at the supply side and demand side. Information on Energy Efficiency has been disseminated through the mass media, newspapers, conferences, seminars, workshops and publication. The following sections highlight the energy efficiency development in Malaysia. 5.0 Energy Efficiency Basically Energy efficiency covers the efficiency of power generation, transmission and distribution of electricity as well as various end uses of energy such as in the industrial, commercial and residential. In other words it can be divided into supply and demand side perspective. Energy efficiency has been identified as one of the criteria to ensure sustainability of energy supply since 7th Malaysia Plan (1996-2000). The key emphasis is to encourage the use of new and alternative energy sources as well as efficient utilization of energy. In the recent 10th Malaysia Plan (2011-2015), the key emphasis is on the short term goals vested in National Green Technology Policy (2009), these include promotion of EE for power producer, establishment of EE targets and standards. 5.1 Energy Efficiency at Supply Side In the electricity production side, there are huge energy savings that can be realized amongst others by replacing the old inefficient thermal power plants with a high efficiency generation technology or simply by rehabilitation and retrofitting of some old power plants. High efficiency generation technology introduced in gas turbine based combined cycle power plant and coal power plant will help to improve overall plant power production efficiency. The efficiency of the gas and coal power plant work based on the thermodynamic efficiency of a Rankine steam cycle. Its efficiency increases with increasing of temperature and pressure of the superheat steam entering the turbine. A Rankine cycle describes a model of steam-operated heat engine most commonly found in power generation plants. It converts thermal energy in pressurized steam into useful mechanical work. Common heat sources for power plants using the Rankine cycle are the combustion of coal, natural gas and oil, and nuclear fission. Table 2 shows the plant efficiency and the steam parameters for a high efficiency generation technology. In the usual designation of the steam parameters the second temperature refers to single reheating. Table 2: Steam Parameters for Generation

Technology Plant Efficiency Steam Parameters Subcritical Steam Plants 37-39% 170 bar

537°C/537°C Supercritical Steam Plants 39-46% 246 bar

537°C/ 565°C Ultra Supercritical Stream Plants 46-49% 306 bar

598°C/598°C Advanced Gas Turbine (H-Frame) 58%-60% 1250°C -1350°C A typical steam generation unit such as gas and coal power plant has low energy efficiency around 33-35%. Smart Grid demonstration projects has been carried out by Malaysia’s utility corporation Tenaga Nasional Berhad at the commercial area of Bukit Bintang in downtown Kuala Lumpur, the industrial park of Bayan Lepas in Penang and the Greenfield development area of Medini in the Iskandar Development Region in Johor (David Lee, 2011). The demonstration projects were carried out in three (3) phases. First


phase involves the retrofitting of substations serving those three areas with sensors and communication devices (2010). Second phase will involve the installation of 5,000 smart meters in those three areas (2011-2013). Third phase will cover the consideration of renewable energy interconnection to the national grid specifically for the following applications such as electric cars and charging stations, solar photovoltaic, energy storage and solar-powered/LED street lights. With the smart grid implementation, energy will be utilized more efficiently via high end communication platform such as broadband internet, wireless technology such as WiMax. This communication is important to link databases from power supplier to customers as well as for predictive maintenance. 5.2 Energy Efficiency at Demand Side

The following outlines the improving of energy efficiency activities that has been carried out in Malaysia. a) Industry Under the Malaysian Industrial Energy Efficiency Improvement Project (MIEEIP) from 2000-2007 which was funded by United Nation Development Program (UNDP), Global Environmental Facility (GEF), private sector and Government of Malaysia, eight industrial sectors, cement, ceramic, food, glass, iron & steel, pulp & paper, rubber and wood has been identified to have the potential to promote and improve energy efficiency. The aim of the project is to improve EE in Malaysia’s industrial sector by identifying and reducing barriers to efficient industrial energy use and encouraging implementation of EE improvement projects in industries whilst promoting capacity building of local EE experts and consultants and help authorities to develop a legal basis for improving EE. Eight (8) major programmes have been indentified to help promote efficient use of energy in the industrial sector as outline in Table 3. Several publications also been produced from the outcomes of the MIEEIP program. Table 3: MIEEIP Components (UNDP, 2006) No MIEEIP Component

Programme Description

1 Energy-use Benchmarking Programme

Creation of data collection and database system for energy benchmarking set up. Benchmarking will help to educate industries on energy use reporting and awareness for continuous improvement.

2 Energy Audits Programme Assessing current practice in energy auditing and to develop standardized energy audit tools and procedures. By 2007, 54 factories from various sub-sectors of industries have been audited.

3 Energy Rating Programme Dissemination of information to increase awareness and encourage the use of energy efficient equipment through energy rating programmes such as refrigerator, fan, etc

4 EE Promotion Programme

Provision of user-friendly mechanisms to access and retrieve relevant information. A collection of techniques and technologies applications database on the successful EE applications in their energy saving efforts are being documented and disseminated to encourage participation through the Federation of Malaysian Manufacturers (FMM). Newsletter, conferences, workshops, seminars and website will be used as a medium of dissemination of information.

5 Energy Service Companies (ESCOs) Support Programme

Educating ESCOs in identifying feasible projects, technical know-how and increasing more full-time professional energy auditors

6 Energy Technology Demonstration Programme

Several demonstrations projects with proven technologies can be developed, implemented and monitored in selected sub-sectors of industry. Substantial benefits can be shown by demonstrating actual application and not necessarily costly. These involves feasibility studies of the system, the engineering design, installation, operation, monitoring and evaluation of the energy technology demonstration programmes.

7 Local Energy Efficient Equipment Manufacturing Support Programme

Provision of training, technical assistance and financial incentives to encourage and assist local equipment manufacturers to the selected manufacturers production such as fans, blowers, boilers, motor rewinding and industrial kilns

8 Financial Institutional Participation Programme

Demonstration of the technical and financial viability of energy efficiency measures, energy saving potential and the corresponding potential for GHG emissions reduction will help to train local banking and financial institutions to fund EE projects in industry


The Energy Efficiency and Conservation Guidelines for Malaysian Industries Part 1: Electrical Energy-use Equipment has been produced to give a the guidelines to encourage industries to adopt energy efficiency practices and improving their energy utilization for a commonly used equipment such as fans, motors, pumps, chillers, transformers and air-compressors. A standard general energy audit guideline The Industrial Energy Audit Guidelines shall be used as a reference material by energy consulting firms in their audit services to industries. There are 54 energy audits in the eight industrial sub sectors under MIEEIP. The Efficient Management of Electrical Energy Regulations 2008 under the Electricity Supply Act is enforced where any installation which consumes more than 3 million kWh of electricity over a period of six months will be required to engage an electrical energy manager. The electrical energy manager will be responsible for analyzing the total consumption of the electrical use, to advise on the development and implementation of measures to ensure efficient management of electrical energy as well as to monitor the effectiveness of the measures taken. b) Commercial The government of Malaysia has taken several pro-active actions in promoting energy efficiency through the demonstration of Low Energy Office (LEO) building of the Ministry of Energy, Green Technology and Water in 2004 and also the Green Energy Office (GEO) of Malaysia Green Technology Corporation (MGTC) formerly known as Pusat Tenaga Nasional (PTM) in 2008. These demonstration buildings will hope to encourage private building to also construct and design low energy buildings A green building rating tool called the Green Building Index (GBI) has also been introduced for all types of buildings to encourage the construction of green buildings. The Code of Practice on the Use of Renewable Energy and Energy Efficiency in Non-Residential Buildings under MS 1525:2001 will be incorporated in the amendments to the Uniform Building By-Laws (UBBL) for all building in Malaysia. Figure 3: Green Energy Office (GEO) building, MTGC, Bangi formerly known as PTM Malaysia’s first GBI Certified Rating Building

Figure 4: Low Energy Office (LEO) Building, MEGTW’s building, Putrajaya

Figure 5: Energy Efficiency building, Suruhanjaya Tenaga, Putrajaya Malaysia’s GBI Platinum Rating Building

A handbook entitled ‘Fiscal Incentives for Renewable Energy and Energy Efficiency in Malaysia’ has been published by Government of Malaysia to offer attractive incentives to encourage the generation of RE and adoption of EE initiatives as well as for the improvement of Power Quality (PQ) amongst energy producers and users in Malaysia. The incentives granted include; Pioneer Status (PS), Investment Tax Allowance (ITA), Duty Import Exemption and Sales Tax Exemption on machinery, equipment, materials, spare parts and consumables and Tax & Stamp duty exemption for GBI certified property are provided for industrial and commercial companies who are taking measures to practice energy efficiency in their premises. This handbook does not address fiscal incentives for the transport sector. c) Residential Appliance ‘Star’ Labeling was introduced in 2002. The evaluation and rating of the appliances is carried out by ST. The Energy Star Rating Label indicates a product's energy performance. The


more stars on the upper part of the energy consumption label indicates the more energy efficient of the product. 5 stars indicate the most energy efficient model. Figure 6 shows the comparative label and endorsement label by ST. The endorsement label indicates the most energy saving and high quality of a product. Figure 6: Comparative Label (Left), Endorsement Label (Right)

Eight (8) EE appliances are listed in ST Website. Those EE appliances are Refrigerators, Domestic Electric Fans, Ballast for Fluorescent Lamps, Electric Lamps, Air Conditioners (Split Unit), Televisions, High Efficiency Motors and Insulation Materials. Out of these eight appliances only four (4) appliances have been issued ‘star label’. There are televisions, refrigerators, Domestic Electric Fans and Air Conditioners (Split Unit)

6.0 Campaign for promoting Energy Efficiency Various campaign has been launched from 2003-2006 to promote Energy Efficiency among others a) Newspaper and Mass Media EE Awareness campaign Publication of Energy efficiency guide for households titled ‘Your Guide to Energy Efficiency at Home’ and ‘Be Energy Efficient Guidebook’ published by Energy Commission is distributed to the public. Regular TV commercial on energy saving tips at home has been aired through national TV stations.

‘Promotion of Awareness and Education in RE and EE among School Children and general public’ by Centre for Education and Training in Renewable Energy and Energy Efficiency (CETREE) which is located in the University of Science Malaysia (USM). Mobile van equipped with various education kits brochures and equipment was used to conduct activities in schools. Workshops were also conducted to train teachers to promote RE & EE in schools and this will help in propose a new school syllabus to educate school children on EE (CETREE, 2002). Activities such as seminars and exhibitions on energy efficiency are organized for general public and students b) High Efficient Motor Campaign in 2005 A Six months campaign beginning in May 2005 with the aim of encouraging manufacturers to use High Efficiency Motors (HEMs) in their operation. Fiscal incentives have been introduced by the government for efficient electrical equipment and insulation material.

c) Refrigerator Campaign 2006 ST launched advertising and promotion campaign, featuring Energy Rating Label for Energy Efficient Refrigerators on 11 February 2006. Incentives are given to a 5-STAR rating refrigerators. 7.0 Long term Energy Efficiency Initiatives a) Phasing out incandescent bulb As part of helping in reducing overall global warning by producing less CO2 emission with the saving of natural resources for electricity generation. The government of Malaysia has announced the phasing out


of incandescent light bulbs in stages by year 2014. This is to ensure efficient use of energy among consumers. b) Green Building Rating Tools Worldwide, there is already a push towards building more energy efficient buildings. It began in the 1990 with BREEAM (UK, 1990) and later LEED (US, 1996). The introduction of the green building ratings was the result of the realization that buildings and the built environment contributes significantly to green house gas emissions and thus they needed to be re-designed to reduce their negative impact to the environment. Green rating tools is very dependent upon location and environment. Most of the Green Rating tools are concentrated within the temperature climate zones such UK’s BREEAM, US’s LEED, Japan’s CASBEE and Australia’s GREENSTAR. Their logo is illustrated in Figure 7. ASIA countries are also trying to catch up with this trend, by instituting its own standards, modelled after those adopted by other countries, in the late 2000s. Apart from Singapore Government’s GREENMARK, Malaysia’ Green Building Index (GBI) rating tool is also designed for tropical climate. GBI Malaysia was introduced on 3rd January 2009 by Pertubuhan Akitek Malaysia (PAM) and the Association of Consulting Engineers Malaysia (ACEM) and officially launched on 21st May 2009 (GBI, 2011). Figure 7: From left, GBI Malaysia, Green Mark Singapore, Green Star Australia and LEED US

GBI Malaysia was introduced to promote sustainability in the built environment and raises awareness among developers, architects, engineers, planners, designers, contractors and the public about environmental issues and our responsibility to the future generations. It provides an opportunity for developers and building owners to design and construct green, sustainable buildings that can provide energy savings, water savings, a healthier indoor environment, better connectivity to public transport and the adoption of recycling and greenery for their projects and reducingthe impact on the environment. The GBI Malaysia certification process starts with an assessment of the building design by a certifier appointed by Greenbuildingindex.Sdn.Bhd. Points are given for performance above benchmarks and current industry practice. The buildings will be awarded based on four types of ratings namely certified, silver, gold and platinum depending on the scores achieved. The assessment of Non residential and residential properties under the GBI Rating system is based on six (6) main key criteria as follow as: 1. Energy Efficiency (EE) 2. Indoor Environment Quality (EQ) 3. Sustainable Site Planning and Management (SM) 4. Material and Resources (MR) 5. Water Efficiency (WE) 6. Innovation (IN)

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Table 4: Green Building Index Points and Rating Points GBI Rating

86+ points Platinum 76 to 85 points Gold 66 to 75 points Silver 50 to 65 points Certified

Recently a new GBI for Township Rating tool was launched in 29th March 2011 (GBI, 2011). The GBI Township Tool sets out a vision for sustainability within the built environment and provides guidance to assist end users to deliver sustainable township. The following are the Six (6) core categories has been identified for the delivery of Sustainable Townships in Malaysia. 1. Climate, Energy and Water 2. Ecology & Environment 3. Community Planning & Design 4. Transportation & Connectivity 5. Building & Resources 6. Business & Innovation

Five (5) township pilot projects were registered under the GBI Township Tool. There are TTDI Alam Impian, Broga Valley, Ken Rimba, Elmina East in Selangor and Karambunai Integrated Resort City in Sabah. More GBI rating tools are set to be launched this year this includes The Industrial Rating Tool, The Data Center Rating Tool, The Mall Rating Tool, The Hotel Rating Tool and The Public Health Rating Tool. Since its inception in May 2009, GBI Malaysia has received over 160 applications for registration, 38 % of which are new residential buildings, 60% are new non-residential buildings and 2% existing non residential buildings. 8.0 Way Forward Energy efficiency has been extensively studied in Malaysia but the implementation is very slow. One of the main barriers to Malaysia’s energy efficiency efforts is the Government’s policy on giving subsidies on energy prices for the power and non-power sectors. That’s why Energy Efficiency in Malaysia is still a long way to go in achieving more efficient utilization of our energy resources. Initiatives on energy efficiency have been carried out but on a fragmented basis. If the same outputs can be achieved using less energy, then the costs of energy infrastructure development will be reduced and benefit the society. Transportation sector should be included as part of EE program. The EE program should review specifications and standards for motor vehicles and if possible implement mandatory Minimum Energy Performance Standards (MEPs). Following are some of the brief strategies proposed to improve energy efficiency in the country. The Energy Efficiency & Conservation (EE&C) shall be classified into 4 pillars as in Table 5. Table 5: Energy Efficiency & Conservation (EE&C) Strategies

Pillar Strategy Approach Institutional Strategic

• Consolidate fragmented EE&C programs with a one stop agency supported by a dedicated EE&C legislation

• This agency will regulate, implement, monitor & verify all EE&C Programs, capacity building and serve as an EE&C data bank

Economic Strategic

• Achieve a low-carbon economy and high income economy through heightened competitiveness with extensive Domestic Direct Investments and Foreign Direct Investments

• Move the economy up to value chain and improve energy security Social and Human Capacity Strategic

• Continually and regularly disseminate information on EE&C to the general public via mass media to enhance awareness

• Intensified technical capacity building for implementation of EE&C measures through training, examination and certification for Energy Managers, Energy Auditors and ESCOs.

• Build pool of diversify resources consists of trainers, lecturers, economists, planners, financial and legal practitioners that conversant with EE&C to support implementation of


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EE&C policy • Introduce a curriculum on EE&C at all levels of the education system including at

professional level in order to inculcate the sustainable practice of EE&C Environment Strategic

• Encourage development of clean and green technologies. This will help to conserve the use of depleting primary energy and reduce final energy demand without affecting GDP growth

• Ensuring the national commitment on the reduction of CO2 emission intensity by 40% in 2020 against base year 2005 is achieved.

9.0 Conclusion

Energy efficiency is an important means towards the development of sustainable energy and reducing the impact of the energy sector on the environment. The government of Malaysia recognizes the benefit and importance of EE in the country and several action plans and measures have been taken to ensure economic, energy and environmental sustainability. This includes the drafting of National Energy Efficiency Master Plan which is in the progress at the moment of writing this paper. Many programs and facilities have been planned and implemented. However, the response on EE activities was not encouraging mostly due to relatively cheap energy price. These may change if the government decidse to reduce or eliminate subsidy and allow energy price to follow the real market price. Such unpopular act may receive resistance at the beginning but in the long run it will create an energy prudent and smart society. Furthermore, it is important that the levels of awareness on energy efficiency must be enhanced and a culture of energy conservation must be developed. Government offices, universities, hospitals and schools should be a prime emphasis area to implement and demonstrate the benefits of improved energy productivity. Regular awareness programme and services for consultation for target groups are important. The existence of Energy Service Companies (ESCOs) to assist industry in evaluating and implementing energy-efficient solutions has been shown to be beneficial. References IUCN, ‘Living Resource Conservation for Sustainable Development’, The World Conservation Strategy,

International Union for Conservation of Nature and Natural Resources (IUCN), United Nations Environment Programme (UNEP), World Wildlife Fund (WWF), 1980.

Brundtland, Report of the World Commission on Environment and Development: Our Common Future, World Commission on Environment and Development, 1987. Published as Annex to General Assembly document A/42/427, Development and International Co-operation: Environment August 2, 1987. Available Online [03.07.2011] http://www.un-documents.net/wced-ocf.htm

UNCED, 1992, Available Online [10.07.2011] http://en.wikipedia.org/wiki/Earth_Summit W.M. Adams, ‘The Future of Sustainability: Re-thinking Environment and Development in the Twenty-

first Century’, The World Conservation Union, IUNC, Report of the IUCN Renowned Thinkers Meeting, 29-31 January 2006.

David Lee, ‘Smart grid demo puts new technology to test’, Green Purchasing Asia (GPA), Issue 2, July 2011, Available online [10.07.2011] http://www.greenpurchasingasia.com/pdf/GPA_JULY_Digital.pdf

Ar. Chan Seong Aun, 2004. Energy Efficiency: Designing Low Energy Buildings Using Energy 10, Pertubuhan Arkitek Malaysia (PAM), CPD Seminar 7th August 2004 http://www.pam.org.my/Library/cpd_notes/Energy-Efficiency.pdf (accessed 14 April 2011)

CETREE, 2002, ‘Your Guide to Energy Efficiency at Home: Tips on smart use of energy to save money at home’, Centre for Education and Training in Renewable Energy and Energy Efficiency (CETREE)

Suruhanjaya Tenaga (ST) Website http://www.st.gov.my/eest/eeguide/index.htm (accessed 26 April 2011) Green Building Index (GBI) Available online http://www.greenbuildingindex.org/ (accessed 27 April

2011) Malaysia Green Building Confederation (MGBC), 2010. ‘New Opportunities & New Challenges’,

Sustainable Buildings South East Asia 2010, Conference E-Booklet, SB10SEA, 2010 http://www.mgbc.org.my/Resources.html (accessed 14 April 2011)


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United Nations Development Program (UNDP), Malaysia, ‘Achieving Industrial Energy Efficiency in Malaysia’, ISBN 983-40995-7-6 http://www.undp.org.my/uploads/Achieving_Industrial_Energy_Efficiency_2006.pdf (accessed 14 April 2011)

National Energy Balance 2008 Malaysia, Pusat Tenaga Malaysia (PTM), ISSN No. 0128-6323 Authors’ Background Dr. Tan Ching Sin is currently the Head of Energy Security of the Institute of Energy Policy and Research, UNITEN and as a Senior Lecturer at Universiti Tenaga Nasional (UNITEN). He holds a MSc and PhD (Electrical Engineering) from University of Strathclyde, UK and B.Eng in Electrical Engineering from Universiti of Teknologi Malaysia, Malaysia. Professionally, he is a graduate member of the Board of Engineers Malaysia. His current research interests are Energy Economics; Energy Security, Renewable Energy, Energy Efficiency, deregulation and Pricing Mechanism. Ms. Suhaida Bte Mohd Sood is currently the Head of Energy Policy of the Institute of Energy Policy and Research, UNITEN and as a lecturer at Universiti Tenaga Nasional (UNITEN) She graduated from Lincoln University, New Zealand for B. Commerce & Management, Victoria University of Wellington, New Zealand for B. Commerce & Administration (Hons.), and Lincoln University, New Zealand for Master of Commerce and Management (Accounting). Her current research interests are on energy policy, environment-mitigations for greenhouse gases and housing. Dr. Leong Yow Peng is currently the Director of the Institute of Energy Policy and Research, UNITEN and lectures at Universiti Tenaga Nasional (UNITEN). He has vast industry experience with the Utility Company in Malaysia spanning more than 31 years within the realm of the Energy Industry, Utility Business, Marketing and Customer Relationship Management. Current research interests on Energy Policy; Energy Economics; Energy Security; Energy and Environment. He holds a PhD (Industry & Business Studies) from Warwick Business School, UK; MBA from University of Ohio-Athens and B.Sc in Electrical Engineering from University of Missouri-Columbia, US. Professionally, he is a member of the Board of Engineers Malaysia.

Sustainability Development through Energy Efficiency Initiatives in Malaysia

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