Reducing Carbon Dioxide Emissions from Malaysian Power Sector: Current Issues and Future Directions

Abstract

Malaysia’s power generation mix has always been highly reliance on fossil fuels, mainly from natural gas and coal, with the latter expected to grow from 48% in 2015 to 66% of the overall generation by 2023. Meanwhile, there are growing concerns over the increasing share of coal in the generation mix given its enormous emissions potential and energy security in the future. Electricity generation is responsible for the largest share of GHG emissions in Malaysia As the country pursue to become a high-income economy by 2020, increasing energy demand puts pressure on the government to choose cheaper energy sources when renewable energies become too costly. To date, progress in analysing the current situation and identifying effective emissions reduction strategies in the power sector has been very slow. Current government policy is channelled towards resource diversity and energy security without articulating sufficient emissions reduction targets and measures for the sector. The purpose of this study is to characterise the current issues related to CO₂ emissions reduction strategies in the power sector, identify promising mitigation measures based on the experiences from other countries and the contemporary research outcomes, and note limitations and emergent policy issues. Achieving 45% CO₂ emissions reduction target by 2030 along with high-income economic goal pose unique and enormous challenges for the Malaysia's economy. For these to be achieved, improving electricity generation efficiency in thermal power plants and implementing a group of emission abatement measures such as emissions trading scheme for efficient decarbonization of the power sector are inevitable.