Malaysia is projected to miss its ambitious renewable energy targets for 2025 and 2035, according to a new analysis by GlobalData.
In 2021, the Malaysian government set goals to achieve 31 per cent renewable capacity by 2025 and 40 per cent by 2035.
However, current growth trends suggest the country will only reach 18.2 per cent renewable capacity by 2025 and 36.4 per cent by 2035, falling short of these targets.
Currently, renewables account for 13.3 per cent of Malaysia’s total power capacity.
The government later revised its long-term goal in the National Energy Policy (2022-2040), aiming for 18.4 GW of renewable capacity by 2040.
Sudeshna Sarmah, Power Analyst at GlobalData, notes that Malaysia has significant untapped potential for renewable energy development.
“With a growing population and rising power demands, the country is looking towards clean energy,” Sarmah stated.
The country has made progress in recent years, particularly in solar energy.
In 2016, Malaysia’s Energy Commission introduced a large-scale solar program, allocating 1,250 MW for 2017-2020.
This initiative, along with the Net Energy Metering program, has accelerated the growth of grid-connected PV systems.
Malaysia currently utilises three main renewable sources: solar PV, biopower, and small hydro.
While a geothermal project was launched in 2015, it was later abandoned.
Wind power remains largely unexplored due to unfavourable conditions, with only one small 0.2 MW onshore plant in operation.
The Malaysian government has implemented various policies to encourage renewable energy adoption, including tax incentives and feed-in tariffs.
The Green Investment Tax Allowance and Green Income Tax Exemption have been extended until 2023, while income tax exemptions for solar leasing companies will continue until December 2026.
Despite these efforts, Sarmah suggests more action is needed: “Governmental efforts such as strong policies and encouraging foreign investments towards setting up large scale renewable projects could push the country towards achieving its renewable energy goals.”
As Malaysia strives to balance energy security with climate change concerns, closing the gap between current projections and renewable energy targets will likely require intensified efforts and investment in the coming years.
