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Business
Saturday August 28, 2010
Renewable energy a growth sector for Malaysia
By ELAINE ANG
elaine@thestar.com.my
The Star will feature a series of stories in conjunction with = StarBiz-ICRM=20 Corporate Responsibility Awards. The CR Awards is the result of a = partnership=20 between The Star and Institute of Corporate Responsibility Malaysia = (ICRM),=20 supported by the Securities Commission and Bursa Malaysia Bhd. Its = working=20 partners are PricewaterhouseCoopers (PwC) and Securities Industry = Development=20 Corp.
THE renewable energy sector is fast gaining ground as a new growth = area for=20 many countries worldwide with the vast potential it presents = environmentally and=20 economically.
Renewable energy plays a major role in meeting a country=92s energy = needs,=20 enabling businesses to reap energy cost savings and revenue while = combating=20 global warming.
On the homefront, renewable energy is seen as a growth sector that = will help=20 propel the country into a high-income economy.
The sector, however, is still relatively undeveloped in the country = as=20 reflected in the low achievement of renewable energy targets under the = Ninth=20 Malaysia Plan (9MP).
According to PricewaterhouseCoopers Advisory Services associate = director=20 (sustainability and climate change) Mark Wong, the 9MP targeted the = production=20 of 350MW of grid-connected electricity from renewable sources, = translating into=20 1.8% of electricity mix.
=93However, only 53MW was achieved by the end of 2009, or 15% of the = targeted=20 capacity,=94 he said.
The 10th Malaysia Plan (10MP) re-emphasised the use of renewable = energy to=20 meet Malaysia=92s growing energy demands, in particular hydro power for=20 electricity generation and blending of biofuels for transport = sector.
Two of the steps taken by the Government to help boost development in = renewable energy sector is the plan to implement a feed-in tariff = programme=20 later this year and the mandatory blending of biofuels for transport = sector in=20 2011.
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Wong said renewable energy was expected to contribute about 6% of the = country=92s electricity production mix in the next five years and about = 11% by=20 2020.
=93Renewable energy is often perceived to be a green initiative that = is=20 something nice to do. What needs to be understood is that there is a = strong=20 business case for renewable energy sector in the long term,=94 he = said.
Renewable energy advisor to the Energy, Green Technology and Water = Ministry,=20 Ahmad Hadri Haris, had said in a report that based on projections by = experts,=20 the sector could provide at least RM70bil worth of revenue for the = private=20 sector and potentially generate tax revenue of at least RM1.76bil for = the=20 Government by 2020.
Another economic and social benefit arising from the sector is job = creation.=20 Experts have estimated that at least 52,000 jobs could be created from = the=20 construction, operation and maintenance of renewable energy plants in = the=20 country by 2020.
ACCA Global head of sustainability and corporate social = responsibility=20 Henning Drager said there was a strong recognition that the dependence = on fossil=20 fuels needed to be curtailed. This is based on the Government=92s = support of=20 renewables as reflected in the National Renewable Energy Policy and = Action=20 Plan.
=93Communities, industries, businesses and households need a reliable = energy=20 supply to prosper.
=93Ramping up the renewable energy generation percentage is crucial = if Malaysia=20 is serious about reducing fossil fuels=92 contribution to climate = change,=20 addressing energy security issues around importing oil and coal from = unstable=20 global regions, and the creation of skilled and unskilled jobs in the = domestic=20 renewables sector.=94
Latest projections by the Organisation for Economic Cooperation and=20 Development is that renewable energy, especially solar power, could play = a large=20 role in Malaysia=92s future energy generation. This is because the = country is=20 blessed with over 250 days of sunshine a year, thus providing great = potential to=20 meet the energy needs of businesses and communities.
Amsterdam-based international expert on corporate responsibility and=20 sustainable development, Paul Hohnen, concurred.
He said the country=92s challenges in the long term included the = transition=20 from its reliance on finite supplies of oil and gas to renewable sources = such as=20 solar power and also to ensure maximum diversity and sustainability of = its=20 ecosystems.
=93At the end of the day, the sun is Malaysia=92s greatest renewable = asset. It=20 sustainably powers forests and farms, as well as tourism. But there is = still=20 much untapped potential and this is where much of the growth potential = is.
=93If Malaysia can achieve this transition, it will create firm = foundations not=20 only for domestic solar power industries but also industries based on = plant=20 genetic diversity (such as medicines), and sustainable crops for fuel, = food,=20 fibre and fertilisation,=94 he said.
Drager said significant upfront investment would be required to = increase the=20 contribution of renewables based on a thorough assessment of their = respective=20 generation potential.
=93Addressing any structural, political and cultural barriers to = redirecting=20 government subsidies towards this sector will be a key element for = future=20 success,=94 he added.
Drager said a detailed renewables job creation programme would need = to be=20 worked out by the Government to match the skills based on the renewables = ambition.
=93The programme should also address Malaysia=92s high-income model = because the=20 highly-skilled labour required, including engineers, electricians and = project=20 managers, will be able to demand salary premiums and create aspirations = around=20 joining Malaysia=92s renewables drive.=94
Concrete measures and frameworks needed to be worked out across = stakeholder=20 groups and these include low and no interest loans, longer = return-on-investment=20 timelines, tax incentives and ambitious renewables targets, he said.
> To participate in StarBiz-ICRM Corporate Responsibility =
Awards 2010,=20
you will need to fill out an online questionnaire. Submission closes on =
Sept 24.=20
The online questionnaire is accessible at
StarBiz-ICRM Corporate Responsibility Awards 2010: Workshop to = assist=20 companies to fill out survey
IN conjunction with the StarBiz-ICRM Corporate Responsibility Awards = 2010,=20 CSR Asia in association with the organisers , StarBiz and ICRM, will = conduct a=20 workshop to assist companies with completing the survey.
The workshop will be held at Cyberhub on 1st Floor, Menara Star, = Section 16,=20 Petaling Jaya from 9.30=9611.00 am on Sept 2. For those attending the = workshop,=20 kindly bring along your laptop to access the survey online or a printed = copy of=20 the survey.
For those who cannot make it during that time, CSR Asia staff will be = on hand=20 for the rest of the day at the same venue to answer your questions. = Companies=20 that have difficulties completing the survey or require further guidance = and=20 information are strongly encouraged to attend this workshop. =
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