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Malaysia

Brief description:

ENERGY & CLIMATE CHANGE - POLICY AND PROGRESS

(This country has no specific CCS policy)

Emissions

Malaysia, one of south-east Asia’s most vibrant developing economies, signed the UNFCCC in 1993 and ratified the Kyoto Protocol in 2002. It is, however, a non-Annex 1 Party with no obligation to reduce its GHG emissions. It submitted its initial national communication to the UNFCCC in 2000, which gathered emissions data for 1994. The second national communication was submitted to the UNFCCC in April 2011.

In 1994, Malaysia emitted 144 million tonnes of greenhouse gases, or 3.7 tonnes per head of population. The energy sector accounted for 87% of total emissions, with landfill contributing 46.8% and fugitive emissions from oil and gas being 26.6%.

The country’s power sector is the biggest emitter of CO2 - as of 2010, fossil fuels accounted for about 89.6% of the fuel mix, with coal representing about 32.1% of that figure.

The country’s primary energy resources are oil, gas, coal and hydropower. At the time of the report, oil and natural gas accounted for 93% of the country’s energy consumption. The government estimated that its economy would expand almost eight-fold by 2020, with emissions rising whether a business-as-usual or an efficiency-orientated approach was followed.

However, the government suggested that the efficient use of renewable and non-renewable energy sources together with efficient transport, conservation measures and sustainable use of forests had kept emissions relatively low compared to other more industrialised nations.

Climate change/CCS challenges

Malaysia lies within one of the regions of the world that is expected to experience the worst impacts of climate change. Temperature records show a warming trend, which is likely to affect agriculture generally and crop yield in particular. The country produces rubber, palm oil, cocoa and rice, and global warming could make areas prone to drought or flooding unsuitable for agriculture – thereby posing a threat to food security and the country’s export economy.

Increasing temperatures would lead to water shortages, changes to rainfall patterns and increasing sea levels, which would make Malaysia prone to tidal inundation, shoreline erosion and damage to coastal facilities, such as power plants. Climate change would also potentially impact on the operations of the oil, gas and fishing industries. There are also potential health threats posed by an increase in water and air-borne diseases.

The greatest challenge for CCS deployment in Malaysia is funding.  Without a large surplus of money for clean energy projects, Malaysia uses the UN's Clean Development Mechanism to achieve many of its GHG reductions, potentially the route to generate interest in CCS technologies. In fact, state oil and gas producer, Petronas, sponsored one of the first applications for a CDM methodology for CCS. 

The Global GCCS Institute (GCCSI) has suggested that CCS will be of increasing interest to Malaysia, due to the resource and power industries that form the basis of its economy and the increasing CO2 content of its remaining natural gas reserves. As gas reserves decrease there is also talk of a substantial increase in coal power capacity. Read their analysis here.

Government commitments and initiatives

Malaysia launched its National Policy on Climate Change in 2010, but there have been no major policy developments since then. 

Malaysia’s National Green Technology Policy (2009) outlines five strategic policies relating to CCS development but does not refer to specific CCS activities. Its Second National Communication (see above) stated that the country’s ability to meet its voluntary emissions reductions depended on access to the technology. It also said new areas such as clean coal and CCS should be considered.

At the UNFCCC COP15 in 2009 in Copenhagen, Malaysia made a conditional commitment to reduce the carbon intensity of the country by 40% in 2020 based on 2005 levels. With coal expected to remain one of the main fuels for the power sector, accounting for 41.5% of the fuel mix by 2020, CCS is an attractive option for the country.

Acknowledging the future potential of CCS, Malaysia joined GCCSI in 2009. Several CCS capacity building events have since been held there, with the close co-operation of GCCSI.

In early 2011, the results of a scoping study on CCS in Malaysia were published. It was carried out by a partnership of the Ministry of Energy, Green Technology and Water (KETTHA), GCCSI and the Clinton Climate Initiative, along with other government and industry stakeholders. The scoping study focused on the long and short-term role of CCS as well as technical and financial viability, and how to take it forward. KETTHA is now progressing with plans for CCS deployment, and has set up a multi-stakeholder steering committee to consider the recommendations of the study. Malaysia has set up a National Climate Committee comprising the Ministry of Science, Technology and the Environment and representatives from relevant sectors to help it meet its UNFCCC obligations. The Malaysian Meteorological Service (MMS) serves as secretariat to this committee.

Since the 1970s, the government has introduced various measures to help meet sustainable development goals. These include five-year development plans and its Vision 2020 – set up in 1991 to realise the country’s goal of becoming a self-sufficient industrialised economy by 2020 through economic prosperity, social well-being and political stability.

The government has also introduced energy efficiency measures, such as the construction of light rail transit and electrical rail systems, improvements to roads, and guidelines for energy-efficient buildings. There is also a system of environmental impact assessment for each sector, and this includes the protection of forests, a long-term commitment to maintaining a minimum of 50% forest cover, and a national policy on biological diversity. However, there is still to be any major developments in policy with regard to climate change.  

It is also considering a study of potential CO2 storage sites, with support from the Global CCS Institute.

There is various legislation in place to protect land, coastal and marine resources from soil erosion and air and water pollution, and the government is attempting to conserve energy and mineral resources by rationalising oil and gas production. Other measures introduced include include a drive to increase the use of biomass for energy production, studies on the carbon sequestration potential of forests, and the use of photovoltaic energy sources in urban areas.

Regulatory framework

No specific CCS legislation has come into force, as of July 2012. Malaysia conducted a preliminary CCS scoping study in 2010, which covered issues such as emissions reduction, potential storage sites in the country, CO2 transportation, and the economic viability of CCS. It also explored the legal and regulatory aspects of implementing CCS and reported a lack in its existing system.

The country considers the establishment of an appropriate regulatory framework as a precursor to going ahead with CCS deployment. It also identified the need for international co-operation and assistance in preparing the framework. It is keen to define the commercial viability of CCS before committing further to its deployment and believes it still has to undertake a great deal of preparatory work in all relevant areas, not least in fostering public acceptance of CCS.

In the next six months, the Ministry of Energy, Green Technology & Water plans to set up an inter-agency CCS steering committee, which will plan for the future implementation of CCS in Malaysia. The government will also work towards establishing a suitable legal and regulatory framework.

In May 2011, Malaysia contributed to the IEA's bi-annual CCS legal review. Read their submission by downloading the review here

Malaysia has participated in the GCCSI’s policy, legal and regulatory study group and the Asia-Pacific Economic Cooperation CCS regulatory review. Findings will feed into future work on the regulatory regime for CCS in Malaysia.

International co-operation

Malaysia’s Institute of Strategic and International Studies (ISIS) is an independent agency set up in the 1980s to conduct policy research and engage with both the public and private sectors. It has been a guiding hand in various initiatives, including Vision 2020. It also plays a role in promoting international co-operation, but particularly within the Asia-Pacific region. One of its five stated areas of interest is ‘technology, innovation, environment and sustainability’.

The Malaysian government received financial support from the Global Environment Facility (GEF) to produce its initial national report to the UNFCCC. GEF is an independent agency that provides funding to developing countries for projects that benefit the environment.

Other information

Department of Environment, Malaysia

 

 

 

 

 




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