Energy policy

Md. Mizanur Rahman MEng(Sweden), PhD (Finland), CEng Chartered Energy Engineer (EI, UK) Certified Energy Manager School of Mechanical Engineering Universiti Teknologi Malaysia Email: mizanur@mail.fkm.utm.my

Energy Policy?

Energy policy elements are the main ingredients of energy policy to deal with the energy-sector activities,

issues, challenges and barriers through the undertaking of various policy measures or instrument

Energy Policy Malaysia

Vested the exclusive right to explore,

develop and produce petroleum in

Malaysia to PETRONAS

To regulate downstream oil and gas industry via the Petroleum Act

Energy Supply-demand Balance

• Energy demand is projected to increase from 2,000 PJ in 2009 to 4,013 PJ in 2030

• Average rate of 3.6% p.a.

• Malaysia was projected to be a net energy importer by 2019 4

National Energy Policy 1979

5

A simple form of energy policy defined in terms of its objectives:

Supply objective is to ensure adequate and secure energy supply at reasonable prices

Utilisation objective is to use energy efficiently and to cut down on wasteful ways of using energy, and

Environmental objective is that in ensuring the achievements of the supply and utilisation objectives, the environment is not degraded adversely

Four fuel policy 1981 • Oil, gas, hydro, coal • To diversify energy mix used in power generation • To reduce overdependence on oil as the principal energy source

6

National Depletion Policy 1980

• Total annual production of crude oil should not exceed 3% of oil-

originally in place

• Limit the production of oil at about 680,000 barrels a day

Fifth Fuel Policy 2000

• RE

• Targets

500MW in 8th Malaysia Plan

350MW in 9th Malaysia Plan

New Energy Policy 2010

https://www.st.gov.my/

New Energy Policy 2010

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Energy Pricing (Adoption of market-based energy pricing)

Gas price revision every 6 months

Itemised billing in consumer utility bills

Energy Supply (Initiatives to Secure and Manage Reliable Energy Supply)

Third party access to gas sector, RAPID Johore – Refinery and Petrochemical

development

Power generation stations, Feed-in tariff, studies on alternative energy sources

New Energy Policy 2010

9

Energy Efficiency (Measures to encourage efficient use of energy)

SAVE (RM40million was disbursed for Sustainability Achieve Via Energy Efficiency (SAVE) Program to SEDA)

EE testing lab (A total of RM 45 million was allocated to SIRIM for EE Testing Lab

EE Act

Governance (Various entities established to address separate element of the energy industry)

MPRC, MNPC, MyPower, SEDA

Change Management

Gradual and phased implementation

Regional (ASEAN) Cooperation

Framework for Electricity Supply Industry in Malaysia (Acts and Regulations)

Electricity act

1. Energy Commission Act 2001

2. Electricity Supply Act, 1990

1

0

Regulations 1. Electricity Regulations, 1994 2. Licensee Supply Regulations, 1990 3. Electricity Supply (Exemption) Notification 1994 4. Efficient Management of Electrical Energy Regulations 2008

Efficient Management of Electrical Energy Regulations 2008 (EMEER 2008)

• Licenses Issued by Energy Commission and approved by Minister

• Licenses issued to generators, distributors and suppliers

• License conditions

Prescribes mandatory standards for licensees’ activities

• Industry codes and guidelines issues by Energy Commission

Grid Code, Distribution Code, Guidelines provide guidance for industry

Evolution of Malaysian Electricity Supply Industry (MESI)

Energy Commission regulates the electricity supply industry

TNB Fuel and PETRONAS, the sole suppliers of coal and gas respectively

Single Buyer (SB) and Grid System Operator (GSO) set up and ring fenced within TNB

New Energy Dispatch Agreement (NEDA) set up – cost efficiency, short run (daily) competition, instead

of long term PPAs

MESI 2.0

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• Fuel supplies, generation segment and retail services may evolve to be under competitive environment

• New SB and GSO act as independent functions as part of level-playing field objective • Transmission and distribution wires remain natural monopoly (and regulated)

• Green choices

Government Initiatives to Promote

Energy Efficiency

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EE Policy

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National Energy Efficiency Action Plan 2015

The National Energy Efficiency Action takes 5 key initiatives

Initiative 1: Promotion of 5-Star Rated Appliances;

Initiative 2: Minimum Energy Performance Standards (MEPS);

Initiative 3: Energy Audits and Energy Management in Buildings and Industries;

Initiative 4: Promotion of co-generation

Initiative 5: Energy Efficient Building Design.

EE Strategies

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Five Fuel Policy

Focus in industrial and commercial sectors

Fiscal incentives

Regulations

• Demonstration projects

• Integrated complexes/townships

• Demand side management

• Development of related industries and

services

• Research and development

• Energy use benchmarking

• Energy rating and labelling

EE Strategies

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Efficient lighting and air

conditioning systems

Energy management systems

Incorporation of EE in Uniform

Building By Laws

Courses in learning institutions

• Market pricing for energy

• Emphasis on demand side

management

• Regional (ASEAN) coorporation

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EE Programmes

• Demonstration projects

• EE and RE incentives enhancement

• EE/Demand Side Management project

• Malaysian Industrial Energy Efficiency Improvement Project (MIEEIP)

• Development of Energy Service Companies (ESCOs)

• Development of EEC Guidelines

• UNIDO Project

• Building Sector Energy Efficiency Project (BSEEP)

EE Programmes

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• Awareness Programmes • Newspaper campaign Seminars/workshops

• Energy Efficiency (Domestic) Guidebook

• Sectoral Programmes • High Efficiency Motors Promotion

• High Efficiency Refrigerators Promotion Appliance Energy Efficiency Labelling Building Energy

Efficiency Benchmarking

EE Awareness/Education

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• Centre for Education and Training in Renewable Energy and Energy Efficiency (CETREE)

Located at Universiti Sains Malaysia

Objective – to increase awareness of RE and EE in the country

Target groups – secondary schools, universities, professionals, general public

To be a national centre for EE and RE awareness

MIEEIP

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The Malaysian Industrial Energy Efficiency Improvement Project (MIEEIP)

- Objective was to improve EE in Malaysia’s industrial sector by: -

Identifying and removing barriers

Encouraging implementation of EE projects

Capacity building

Developing legal framework

MIEEIP

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MIEEIP initially focused on 8 energy intensive

industrial sub sectors: -

- Iron & steel

- Cement

- Wood

- Food

- Glass

- Pulp & paper

- Ceramics

- Rubber

It was later extended to 3 more sectors, oleo-chemical,

plastic, and textile sectors

MIEEIP

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• MIEEIP Programmes include: -

Energy-use Benchmarking

Energy audits

Energy rating

EE promotion

ESCOs support

Energy Technology demonstration

Local manufacturing support

Energy Efficiency Rating and

Labelling of Appliance and Material

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EE Rating and Labelling

• EE Rating and Labelling for: -

Refrigerators

Air Conditioners

Fans

Televisions

Motors

• EE Rating: -

• Lamps

Fluorescent Lamp Ballasts

Insulation Material

50

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EE Rating

Building Demonstration Projects by the Government

Improved versions with

more sustainable

features

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Targeted Building Energy Index for EE’s Building:

85 kWh/m²/year

19

51

116

39

4

13

28

0

20

40

60

108 100

80

120

140

Cooling Energy Fan Energy Lighting Energy Plug Load Energy

Categories

kW

h/m

2/y

ea

r Building Energy Index

Base Building Proposed Building

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Awareness Campaigns and Promotional Activities

Printed media: handbooks, brochures, posters, competitions, advertisements

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EE Conservation for Electrical Energy Use

Equipment

Energy Audit

Guidelines

EE Conservation for Thermal Energy Use

Equipment

Commercial Buildings

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Industrial

Industry Development

Malaysia Industrial Energy Efficiency Improvement Project (MIEEIP)

Establishment of Malaysia Energy Services Companies Associations (MAESCO)

Establishment of Malaysia Energy Professional Association (MEPA)

Establishment of Green Building Confederation and Green Building Index rating tool.

Endorsement of Continuous Development Program providers by Energy Commission in efficient

management electrical energy

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Developments in Electricity Supply

Industry

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• Competitive Bidding for new 1000MW coal-fired power plant.

• Incentive Based Regulation

• Activity based licensing

• Guaranteed Service Level (GSL) / Minimum Service Level (MSL)

• Ring fencing of the Grid System Operator

• Revision of the Grid Code

• New Distribution Code

Subsidies

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Introduced under the government financial budgetary support with

the aim of promoting EE projects through the provision of tax

incentives;

• Investment Tax Allowance

• Accelerated Capital Allowance

• Import Duty Exemption

• Sales Tax Exemption

• Energy Efficient Products

Legislative Framework, Codes, Guidelines

and Standards

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MS 1525: 2007 – Code Of Practice on Energy; Efficiency and Use of Renewable Energy for Non-residential Buildings:

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MS 1525

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MS 1525: 2014 – Code of Practice on Energy; Efficiency and Use of Renewable Energy for Non-Residential Buildings: -

• Architectural and passive design strategies

• Building envelope

• Lighting- illumination levels, lighting controls, O&M

• Electric power and distribution

• Air conditioning and mechanical ventilation

• Energy Management control system

Energy Efficiency and Conservation

Guidelines

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EEC Guidelines

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Part 1 – Electrical Energy Use Equipment : -

• Published in July 2007

• Section A – Over view on EE in Malaysia

• Section B – Equipment Guidelines

Types of Equipment

EE Potential

Selection Guide

Guidelines on Operations and Maintenance

EEC Guidelines

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Part 1 – Electrical Energy Use Equipment:-

• Transformers

• Motors

• Chillers

• Cooling Towers

• Fans and Blowers

• Pumps

• Air Compressors

• Lighting

EEC Guidelines

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Part 2 – Thermal Equipment : -

• Published in June 2010

• Includes: -

• Boilers and Furnaces

• Thermal Oil Heaters

• Absorption Chillers and Heat Recovery

Equipment

• Cogeneration System

MS ISO 50001 Energy Management Systems-

Requirements with Guidance for Use

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MS ISO 50001 - Contents

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1 Scope

2 Normative references

3 Terms and definitions

4 Energy management system requirements

1. General requirements

2. Management responsibility

3. Energy policy

4. Planning

5. Implementation and operation

6. Checking performance

7. Management review

Annex A (info) Guidance on the use of this standard

kWh/m2/year

Conclusions

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A number of initiatives have been undertaken to promote EEC and use

of RE

Not very encouraging results so far

The way forward

Managing facilities well will contribute significantly in this

respect

Malaysia’s commitment towards global climate change initiatives