The governmenty wants to increase the national renewable energy mix to 70 per cent of total installed capacity by 2050. A low-carbon energy system is crucial to facilitate the journey to economy-wide decarbonisation targets under the Paris Agreement.
There is a critical need to secure stakeholder buy-ins so that this ambitious transformation can happen seamlessly.
The Natural Resources, Environment and Climate Change Ministry has been active in enhancing the energy market to create a sustainable ecosystem that can increase support from industrial players and investors. But societal buy-in should not be overlooked.
This is especially relevant given that the transition to a sustainable energy future will require reforms to the energy subsidy scheme, which will also result in notable land-use change.
Both subsidy reform and land-use change, if mishandled, can result in social opposition that could delay the energy transition.
The government must develop a new narrative to communicate the need for the energy transition. The traditional way of framing it as "climate change mitigation" can resonate only with a small proportion of the population.
There is no doubt that society is already experiencing the adverse effects of climate change, including extreme weather events and heatwaves.
But it is not easy for individuals to contextualise the impact of emission reductions that energy transition can bring, or to picture the savings in social costs.
This is especially relevant when energy transition, coupled with reforms to the fuel and electricity subsidies, results in higher expenditure for individuals.
Simply highlighting the investments and jobs that come with energy transition does not do justice to the wider economic benefits that a sustainable approach brings.
The government should use energy transition to produce a structural shift towards a future that promotes more equitable rural-urban income distribution.
It should also leverage the new economic opportunities created by low-carbon energy investments to enable a more geographically dispersed energy economy.
Economic opportunities outside of power generation can be created. These include the manufacture of solar panels and electric vehicles outside of urban areas.
This can help address the issue of urban economic migration as more jobs will be created.
Collaboration between the federal ministries and state authorities is crucial in identifying and acquiring strategic locations for renewable power generation and supply chain clusters.
There will also be opportunities for entrepreneurial ventures, such as restaurants and small shops catering to workers in these newly established low-carbon economic clusters.
The number of multinational corporations (MNC) committed to relying exclusively on green electricity increased from 200 in 2019 to over 400 in 2023. So the government needs to communicate to society the importance of renewable energy availability in attracting MNCs to Malaysia.
Building dedicated renewable power plants with readily available direct power purchase agreements reserved for strategic foreign MNC partners will be instrumental in attracting firms focused on environmental, social and governance. The facilities will differentiate Malaysia from regional competitors, who may face constraints in power plant development due to limited land or capital.
Such examples will enable society to visualise the investment impact of energy transition, as well as the well-paying high-skill jobs.
* The writer is an energy market consultant focusing on power and low carbon solutions at a leading consulting firm in London and holds an MSc in Energy Systems from the University of Oxford