Environmentalist laments lost opportunity in RE export

 

Malaysia has most of what it takes to produce renewable energy, making the ban on its export an unwise move, says an environmentalist.

PETALING JAYA: Malaysia should lift the ban on selling renewable energy (RE) to its neighbours given the huge potential it has as an export commodity, according to an environmentalist.

However, an academic warned, it could make land acquisition for other projects more costly.

Climate Governance Malaysia (CGM) council member Gary William Theseira pointed out that Singapore would have been a ready customer for Malaysian RE.

“The island republic is short of land and has no biomass. It also has a limited capacity for solar and wind energy (all or most of which Malaysia has),” Theseira told FMT Business.

“Banning the export of RE was an opportunity lost for Malaysia. We should not have done it in the first place.”

He said the government of the day failed to understand Malaysia’s obligations under the Paris Climate Accords, leading to its “knee-jerk” reaction to impose the ban.

Signatories to the 2015 treaty are bound by its terms to take steps to mitigate climate change under conditions aligned to their individual needs and capacities.

Malaysia is obliged under the agreement to reduce its carbon intensity by 45% of 2005 levels by 2030.

The benefits

Theseira lamented Malaysia’s failure to see the economic benefits of selling RE to Singapore. “The city state’s mighty dollar could have financed the development of RE in Malaysia,” he said.

However, he said, it is still not too late for Malaysia to change course.

UNITAR International University adjunct professor Renard Siew also agreed that the ban should be lifted, pointing out that it would spur the development of yet another potential money earner.

“This will also lead to the creation of more ‘green’ jobs in the country,” he told FMT Business.

He said the thinking at the time when Malaysia signed the accord was that the country needed to meet its obligations under the climate accord before exporting RE.

As such, the export of RE should be seen as a new growth area.

“Exporting RE will also foster cooperation among Asean countries,” he said.

The flip side

Asia School of Business assistant professor Renato Lima de Oliveira expressed fear that it would make land acquisition for other projects more costly.

“Lifting the ban would help the business of solar developers, which is a growing industry, (and thus raise the demand for land),” he told FMT Business.

“On the other hand, if the decarbonisation of Asean’s power system is seen as a bloc, allowing energy export would promote efficiency.”

Lima de Oliveira also warned that Singapore’s demand for clean energy could immobilise plots of land in Malaysia for 20 to 30 years, land that could otherwise be conserved or used for alternative economic purposes for the benefit of locals.

The legacy of the ban

Malaysia imposed the ban on exporting RE in 2021, when Ismail Sabri Yaakob was prime minister. It was primarily focused on not sending RE to Singapore.

The ban did not extend to the passage of electricity from other countries to Singapore.

But, on March 9, natural resources, environment and climate change minister Nik Nazmi Nik Ahmad said the government plans to review the ban.

Singapore now imports renewable energy from Laos.

And while Malaysia lingers, Indonesia has taken the opportunity to exploit the potential of a rising need for RE in Singapore.

Recently, the two countries signed a deal to create a framework for commercial cooperation on renewables, transmission infrastructure and cross-border electricity trading.

The two countries also have a pact to boost foreign investments and to develop the production of RE in the Riau islands.

Singapore, which now generates 95% of its needs using natural gas, seeks to import 30% of its energy needs by 2035 as it works to decarbonise its economy.

Businesses are also seeking to unleash Indonesia’s potential in solar energy production, which it plans to rely on to meet its own climate goals, according to a report on Bloomberg News.

Indonesia is emerging as a key power provider to Singapore and Malaysia ignores this at its own peril. - FMT