Malaysia to achieve 40% renewable energy share by 2035 – report

Malaysia is on track to meet its 40% renewable energy capacity target by 2035, a new analysis has revealed. Power Technology‘s parent company, GlobalData.

In 2021, the Malaysian Ministry of Energy and Natural Resources (KeTSA) targeted 31% renewable energy capacity by 2025 and 40% by 2035. The government then set a target of achieving 18.4GW of renewable energy capacity by 2040 in the National Energy Policy (2022-2040).

Currently, 13.3% of Malaysia’s total generating capacity comes from renewable energy. If current growth rates continue, Malaysia is expected to increase its renewable energy capacity to 18.2% by 2025 and 36.4% by 2035, according to GlobalData.

The latest from the data and analytics company report – Malaysia Electricity Market Size, Trends, Regulation, Competitive Landscape and Forecast, 2024-2025 – argues that Malaysia is “rich in untapped potential for renewable energy sources” that can be developed to “achieve energy security while addressing climate change concerns”.

Sudeshna Sarma, power analyst at GlobalData, said: “In 2016, Malaysia’s energy commission, Suruhanjaya Tenaga, introduced a large-scale solar power program with a total allocation of 1.25GW for the period 2017-2020, which resulted in accelerated growth in grid-connected PV systems. Additionally, the Net Energy Metering program has facilitated the emergence of the distributed renewable energy market.”

Currently, solar, bioelectricity and small-scale hydroelectricity produce the majority of the country’s renewable energy.

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The country only has one small onshore wind farm with a generating capacity of 0.2MW, as wind speeds in the region are unstable during the off-season, making it an insufficient source of electricity, but GlobalData says that “a few smaller wind projects could still make a difference.”

GlobalData highlights that the Malaysian government has taken several steps to support renewable energy in the country, including extending the Green Investment Tax Credit and Green Income Tax Exemption until 2023. The government also announced an income tax exemption for solar power leasing companies that will run until December 2026.


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