THERMAL power plants continue to provide secure and equitable energy supply globally, and according to the National Energy Balance, account for 80 per cent of electricity generation in Malaysia.
Cofiring biomass in thermal power plants is practised by several countries, starting in Europe and lately in Asia as a means of sustainable electricity generation towards achieving Net Zero targets.
Similar to other renewable energy sources, bioenergy is relatively costlier than conventional electricity generation especially when externalities arising from emissions are unaccounted for.
Hence, various support mechanisms are in place to develop and ensure successful and continuous deployment of large-scale modern bioenergy including cofiring biomass in thermal power plants.
Cofiring started commercial implementation in the late 1990s when the European Union introduced its first target for 12 per cent renewable energy generation in 1997.
EU member states then introduced renewable energy certificate (REC) trading schemes where energy suppliers are required to meet the stipulated national renewable energy obligations or quotas.
Under these schemes, energy companies opted for cofiring biomass in their existing thermal power plants as it can be implemented quicker and with reasonable scale when compared to other forms of renewable sources.
This growth of bioenergy was then further promoted with the subsequent Renewable Energy Directives (RED) in 2009 and 2018 where cofiring is explicitly included as an initiative to achieve the increased targets of renewable energy generation.
An example of this quota-based scheme is the United Kingdom's Renewables Obligation Certificate (ROC), where each renewable energy technology is assigned a weighted amount of ROCs that can be traded per unit of energy produced.
The regulatory body can adjust the weightage to meet specific targets, and the value of ROCs is determined by market price.
This scheme successfully supported cofiring growth in the mid-2010s and now supports fully converted biomass-only thermal power plants. Similar REC trading schemes exist in Denmark, Belgium, and Poland.
In the United States, there is no federal scheme for biomass cofiring support. However, state-level Renewables Portfolio Standards (RPS) mandate a certain percentage of electricity from renewable resources.
Under RPS, tradable RECs enable energy suppliers to implement cofiring in thermal power plants. Several states recognise cofiring as a pathway to reduce emissions and promote the use of locally sourced biomass.
Japan had also used RPS to introduce the use of modern bioenergy including cofiring before it was superseded by the Feed-in-Tariff (FiT) scheme in 2012.
On the other hand, in Korea, the introduction of RPS in place of FiT has favoured larger-scale renewable energy projects such as cofiring as a viable option for energy suppliers.
In FiT schemes, producers are tied to long-term energy supply tariffs to ensure the feasibility of deploying high-capital renewable energy projects.
FiT can be tailored to suit various sizes of project scale and to promote particular technologies as how it is implemented by the Sustainable Energy Development Authority (SEDA) for small renewable energy generation.
Besides, various countries have also used FiT as a support mechanism to enable cofiring projects. Germany is a pioneer country in using FiT to support renewable energy deployment.
Even though cofiring is excluded, FiT was eligible for full biomass conversion of existing thermal power plants.
The Environmental Quality of Electricity Production or Milieukwaliteit van de Elektriciteitsproductie (MEP) is a subsidised scheme in the Netherlands, based on fixed premium pricing.
This had successfully resulted in cofiring at all coal-fired power plants by 2012.
MEP was then replaced with Stimulation of Sustainable Energy Production or Stimulering Duurzame Energie (SDE) and SDE+ which was more selective via competitive tendering; and subsidises the price difference as the country reduces its dependence on coal power.
Japan's FiT scheme does not include retrofitting existing thermal power plants for cofiring, but it is eligible for new constructions.
As such, cofiring is incorporated in all new plants, taking advantage of the high electrical efficiency of a minimum of 44.3 per cent and are well-equipped for clean combustion.
Malaysia has recently embarked upon cofiring at Malakoff's Tanjung Bin Power Plant using washed EFB and wood pellets as fuel.
However, this is the remaining project as there is currently no supporting mechanism to enable the growth of cofiring at other thermal power plants.
It is likewise difficult to see higher substitution rates of biomass cofiring due to the competitively low coal prices local thermal power plants experience as well as low production capacity for the biomass fuel to meet the large demand for cofiring.
Doing so would inevitably increase operational costs which will lead to an increase in the selling price of electricity.
As a nation that has committed to phasing out coal power plants, Malaysia needs to expedite the adoption of cofiring to ensure full biomass conversion becomes a reality.
It is essential for energy security and equity that the country maintains a significant amount of thermal power in its generation mix.
A national-level policy on bioenergy must include adequate support mechanisms suited for our position as biomass producers and continue to safeguard the sustainability of the power generation sector.
At the very least, a mechanism to cater for the difference in fuel costs between biomass and coal is to be incorporated in the form of a cost pass-through under the Incentive Based Regulation (IBR) framework since most of the large thermal power plants still have their Power Purchase Agreement (PPA) with the offtaker.
Mechanisms should also be extended to specifically support biomass pellet producers in the numerous green schemes such as the Green Technology Financing Scheme (GTFS) and Green Investment Tax Allowance (GITA).
It is timely for the nation to consider either a more comprehensive price-based, such as a modified FiT, or quota-based RPS scheme to further increase bioenergy capacity.
Such schemes should leverage upon the recently announced carbon tax aimed at the energy industry as we advance towards a just energy transition.
The writer is from the School of Engineering and Physical Sciences, Heriot-Watt University Malaysia