What is Malaysia's pathway to limit global warming to 1.5°C?

Energy system

To be 1.5°C compatible, Malaysia would need to transition its economy away from fossil fuels. The Malaysian government relies on oil and gas revenue from the state own Petronas company, and the oil and gas sector accounts for 20% of Malaysia’s GDP.⁴4^,55 It also relies on coal imports for power generation but has the opportunity to become energy independent through phasing out coal.⁶6

Malaysia’s total primary energy supply (TPES) is 97% fossil fuels. TPES is dominated by natural gas (41%), oil (31%) and coal (24%). Reliance on fossil fuels make the country vulnerable of price fluctuations as experienced recently from COVID-19 impacts.⁷7

Renewables represent 3% of the TPES and 17% of the power generation mix – mainly sourced from hydropower. Malaysia has a target for renewable energy to represent 31% total installed capacity by 2025 and 40% by 2035. It has implemented a feed-in-tariff mechanism to increase renewable energy share in the power mix and a Green Technology Financing Scheme (GTFS) to support green technology projects in all sectors, including energy.⁸8 The feed in tariff, net metering scheme and the GTFS have so far driven renewable energy investments.⁹9

The National Energy Efficiency Action Plan also aims to increase energy efficiency in residential and commercial buildings, and in industry.¹⁰10 Malaysia also plans to increase use of public transport and reduce demand on road infrastructure.¹¹11 Other actions include promoting energy efficient vehicles, palm based biodiesel in blended petroleum diesel, promoting natural gas for vehicles, and biogas recovery from POME treatment.¹²12

Targets and commitments

Economy-wide targets

Target type

Base year intensity target

NDC target

Unconditional NDC Target:

• Reduce the GHG emissions intensity of GDP by 45% relative to the emissions intensity of GDP in 2005 (incl. LULUCF) of which 35% are unconditional. Translates in 11% GHG emissions above 2015 by 2030 (excl. LULUCF).

Conditional NDC Target:

• Reduce the GHG emissions intensity of GDP by a further 10% relative to the emissions intensity of GDP in 2005 (incl. LULUCF) conditional on the receipt of climate finance, technology transfer and capacity building.
• Translates in 6% GHG emissions below 2015 by 2030 (excl. LULUCF).

Market mechanisms

• No use of international market mechanisms.[20]

Long-term target

• None.

Sectoral targets

Power

• 31% of total installed capacity by 2025 to come from renewable energy. 40% by 2035. i.e. 1178 MW of renewable energy by 2025. 2414 MW by 2035.¹³13
• 30% of solar penetration by 2039.¹⁴14
  *Reduction in electricity consumption of 10% by 2025 and 15% by 2030.¹⁵15
• A reduction in the emissions intensity per GDP of the power sector:¹⁶16
  • 45% below 2005 or 0.053 kgCO₂/RM by 2030
  • 65% below 2005 or 0.033 kgCO₂/RM by 2039

(For reference: 0.084 kgCO₂/RM in 2021)

Transport

• 40% modal share of public transport in urban areas by 2030.¹⁷17
• 40% modal share of public transport in cities by 2025.¹⁸18
  • (Note: different targets in competing documents).
• 85% energy efficient vehicles by 2020 and 100% by 2030.¹⁹19^,[21]

Buildings

• 16 common appliances to have minimum energy performance standards (MEPS) rating by 2025.²⁰20
• All appliances to have MEPS rating by 2030.²¹21
• 1750 buildings to have certified green building design by 2030.²²22

Industry

• Number of green manufacturers (with green energy, products, and processes).²³23
  • 10,200 by 2025.
  • 17,000 by 2030.

Waste

• 25% recycling rate by 2025.²⁴24
• 28% recycling rate by 2030.²⁵25
• Three waste-to-energy thermal plants by 2030.²⁶26
• 100% wastewater sludge to be recycled by 2030.²⁷27
• 33% treated wastewater effluent to be recycled by 2030.²⁸28

LULUCF

• Increase the Protected Area Network to at least 20% by 2025.²⁹29