Introduction

The Kyoto Protocol to the UNFCCC is an amendment to the international treaty signed in 1992 on climate change, assigning mandatory emission limitations for the reduction of greenhouse gas emissions to the signatory nations. The objective of the protocol is the stabilization of greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system.Malaysia is a party to the UNFCCC and has ratified the Kyoto Protocol.

As a developing country, Malaysia has no quantitative commitments under the Kyoto Protocol at present. However, together with all other countries, Malaysia is already committed under the UNFCCC to formulate, implement, publish and regularly update national and, where appropriate, regional programmes containing measures to mitigate climate change by addressing anthropogenic emissions by sources and removals by sinks of all greenhouse gases.

Energy demand in Malaysia

Oil and gas have been the main energy sources in Malaysia. However, with its gas reserves estimated to last for another 33 years and oil reserves another 19 years, the Malaysian government is strengthening the role of renewable energy (RE) as the fifth cornerstone of energy generation. Many manufacturing companies in Malaysia are already trying to save energy costs. This creates opportunities to companies offering energy management services to determine ways for saving energy and costs.

Malaysia’s commercial demand for energy is projected to continue its upward trend, from 1,244 Petajoule (PJ) in 2000 to an estimated 2,218 PJ in 2010. This consumption growth is mainly driven by industrialisation. As it is common perception that a nation’s economy and use of energy will always grow hand-inhand, the Malaysian government, in its 8th Malaysian Plan (2001-2005) has declared RE as the country’s fifth fuel in the energy supply mix to diversify its energy source. Currently, the energy supply mix in the country is made up of gas (70 percent), coal (22 percent), oil (2 percent) and hydro power (6 percent).

Renewable Energy in the Ninth Malaysian Plan

The importance of RE as an enabler of strong economic growth is further reinforced in the 9th Malaysian Plan (9MP) (2006-2010), coupled with an emphasis towards Energy Efficiency (EE) both on production and utilisation, while meeting environmental objectives. By 2010, RE is expected to contribute 350MW to total energy supply in Malaysia, which is projected to reach 3,128 PJ. Biomass such as rice husks, palm oil and bio waste will be used on a wider basis mainly for power generation, followed by solar energy. In this case of solar power, the climatic conditions in Malaysia are favourable for the development of solar energy due to abundant sunshine with the average daily solar insulation is 5.5kWm2, equivalent to 15MJ/m2.

Under the Small Renewable Energy Power Programme (SREP), small power plants utilising renewable energy can apply to sell electricity to the utilities companies through distribution grid systems. This project applies to all types of RE, including biomass, biogas, municipal waste, solar, mini-hydro and wind.
In 2005, the 5-year Malaysian Building Integrated Photovoltaic Technology Application Project (MBIPV) was also launched to promote wider utilisation and application of photovoltaic technology in buildings, with the hope that this will eventually create a sustainable and widespread MBIPV market in Malaysia - and possibly grid-connected photovoltaic systems. Several small-scale solar projects have already been implemented to explore the viability of using solar applications for everyday business.

Solution for energy crisis and environmental issues

The EE strategies under the 9MP aim at energy saving features in the industrial and commercial sectors. In this regard, EE features such as efficient lighting and airconditioning systems as well as encouraging the establishment of a comprehensive energy management system. Under the Malaysian Industrial Energy Efficiency Improvement Project (MIIEIP), energy audits to identify ways for potential energy savings are undertaken in 11 energy-intensive industries, which are cement; ceramics; food; glass; iron and steel; pulp and paper; rubber and wood; oleo-chemical; plastic; and textile industries.

On the government front, new sources of energy such as solar and wind will be developed with emphasis on utilising cost-efficient technology as well as strengthening capacity building under the 9MP. In this regard, efforts will be undertaken to co-ordinate R&D activities of the various energy-related research centres. The government has also launched several fiscal incentives to stimulate the emergence of RE and EE activities and technologies. These incentives include pioneer status, investment tax allowance and import duty and sales tax exemption for equipment used in energy conservation. For the private sector, an increasing number of local companies are already taking advantage of RE technologies to begin reaping energy costs and revenue. It is expected that as Malaysian industry becomes increasingly aware of the bottomline benefit of EE equipment and applications, demand for these should rise as well.

Mechanisms under Kyoto Protocol

Flexible mechanisms, also sometimes knows as Flexibility Mechanisms or Kyoto Mechanisms, refers to Emissions Trading, the Clean Development Mechanism and Joint Implementation. These are mechanisms defined under the Kyoto Protocol intended to lower the overall costs of achieving its emissions targets. These mechanisms enable parties to achieve emission reductions or to remove carbon from the atmosphere costeffectively in other countries. While the cost of limiting emissions varies considerably from region to region, the benefit for the atmosphere is in principle the same, wherever the action is taken.

The Emissions Trading-mechanism allows parties to the Kyoto-protocol to buy greenhouse gas emission permits from other countries to help meet their domestic emission reduction targets. Through the Joint Implementation, industrialised countries with a greenhouse gas reduction commitment of Annex 1 countries may fund emission reducing projects in other industrialised countries as an alternative to emission reductions in their own countries. Typically, these projects occur in countries in the former Eastern Europe.

The Clean Development Mechanism (CDM) is an arrangement under the Kyoto Protocol allowing industrialised countries with a greenhouse gas reduction commitment of Annex 1 countries to invest in projects that reduce emissions in developing countries as an alternative to more expensive emission reductions in their own or other industrialised countries. The most important factor of a carbon project is that it establishes that it would not have occurred without the additional incentive provided by emission reductions credits. The CDM allows net global greenhouse gas emissions to be reduced at a much lower global cost by financing emissions reduction projects in developing countries where costs are lower than in industrialised countries.

Concluding Remarks

Rapid depletion of fossil fuel reserves as well as climate change has driven the world towards renewable energy sources which are abundant, untapped and environmentally friendly. In particular biomass fuels hold great promise as a component of CDM strategies to reduce greenhouse gases (GHG) emissions to acceptable levels. The Biomass Energy Plant Lumut was the first Malaysian project to be registered at the UNFCCC as a CDM project. The first large scale CDM project to be registered from Malaysia was this project where biomass is co-fired with coal in cement kilns in two cement works in Kanthan and Rawang. The Jendarata steam and power plant and Jenderata Palm Oil Mill have the expected combined emission reduction of carbon dioxide of more than 30,000 tonnes annually. Meanwhile, a project to combust methane at Seelong Sanitary Landfill is expected to reduce carbon dioxide emission of more than 100,000 tonnes a year. A composting project using palm oil mill effluent in Golden Hope Composting Project would have at least an annual 100,000 tonnes of carbon dioxide reduction.

References

United Nation. (1997). Kyoto Protocol to the United Nations Framework Convention on Climate Change.

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Innovasjon Norge. (2007, September 1). Malaysia: Towards Green Energy. Retrieved September 30, 2007, from the World Wide Web: http://www.innovasjonnorge.no/

Danish Management Group. (2006, October 12). Successful CDM Projects in Malaysia. Retrieved September 31, 2007, from the World Wide Web: http://www.danishmanagement.dk/index. php?option=com_content&task=view&id=55& Itemid=2

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