M’sia boldly explores geothermal

Linda ArchibaldFriday, October 14, 2016

In August, the federal government announced that Sabah will be home to Malaysia’s first geothermal power plant in Tawau.

The 30MW geothermal power plant, to be developed by Tawau Green Energy Sdn Bhd (TGE) at a proposed site in Apas Kiri, is scheduled to achieve commercial operation by June 2018. With this, Malaysia will rank 16th in the world in geothermal energy generation.

Aside from Sabah, Perak is said to be the next geothermal hotspot in the country. It was reported in 2012, that the next major geothermal prospecting in Malaysia is expected to be at Ulu Slim.

In 2015, geothermal made history in the country when Seda Malaysia gazetted the resource as the fifth renewable energy under the Feed-in Tariff (FiT) portfolio, and within the year, TGE secured feed-in approval.

“Geothermal has the potential to contribute to the energy balancing market and this will be important when variable renewable energy (such as solar and wind) increases in the energy mix,” said Energy, Green Technology and Water Minister Datuk Seri Dr Maximus Johnity Ongkili, following a site inspection in Tawau this August.

Malaysia’s bold move to explore geothermal comes after an extensive research, followed by geology, geophysics and geochemistry analysis and modelling by GeothermEx Inc, US, and Jacobs New Zealand, indicating existence of an active geothermal system centred around the flanks of Mount Maria on Apas Kiri.

TGE’s 21-year FiT Renewable Energy Power Purchase Agreement with Sabah’s state-owned utility, Sabah Electricity Sdn Bhd, took effect on July 2, 2015.

The project is expected to offset some 200,000 tonnes of CO2 (carbon dioxide) emissions annually.

To date, two geothermal well pads have been completed with the third under construction. The assumed economic lifetime of a geothermal plant is about 20 years.

Elsewhere, estimates suggest that the area had a potential to host a geothermal power plant with a capacity of 67MW at a depth of 2.5km.

While geothermal is new to Malaysia, it is not new to South-East Asia. The Philippines and Indonesia are the world’s second- and third-largest producers of geothermal power generation behind the US.

International Energy Agency (IEA) reports suggest that geothermal technical potential is estimated at more than 27GW in Indonesia and around 5GW for the Philippines. Such assessments vary widely, indicating the uncertainty of the quality of the resource including temperature and depth, and the type of technology used.

The World Energy Council’s website figures suggest that South-East Asia and Pacific’s regional geothermal installed capacity in 2016 reached 3.96GW.

Southeast Energy Asia Outlook 2015’s World Energy Outlook Special Report revealed that wind, geothermal and solar photovoltaic represent 11% of total installed capacity in 2040 in the New Policies Scenario, a 9% increase from 2014.

Ongoing policy and fiscal support, and the removal of fossil-fuel subsidies are expected to contribute to this expansion.

Stakeholder Engagement

In line with Clean Development Mechanism protocol requirements, TGE hosted a stakeholder meeting in Tawau in July 2011 with almost 200 participants, from local community, government, nongovernmental organisations, and local electronic and print media.

The company, on its website, claims that the session received “much positive feedback from participants, enabling TGE to proceed to registering the project with United Nations (UN) Framework Convention on Climate Change”.

Since geothermal energy development and its associated technologies are new to Malaysia, TGE is also tasked by the government to establish a Geothermal Resource Centre (GRC) in Tawau to bring together stakeholders and specialists in the geothermal energy industry to provide capacity building for the budding Malaysian geothermal industry.

Other roles of GRC include providing specific training and short course programmes in the areas of applied geosciences (geology, geophysics and geochemistry), geothermal exploration, geothermal drilling, steamfield and power plant design and operations; and create a platform for local universities to collaborate with foreign institutions in the field of geothermal energy.

Ring of Fire

While this is a step in a right direction, The Malaysian Reserve discovers how neighbouring Asean countries — Indonesia and the Philippines, are making headway in stakeholder engagement for geothermal industry.

Helping reform the energy sector towards a more sustainable market, supportive of geothermal energy, the Ring of Fire (ROF) programme digs into policy environment, the sustainability aspects, financial and economic issues, plus capacity building and awareness-raising.

According to UN Environment Programme’s South-South Cooperation case study that zooms in on ROF, this effort is to build synergies among stakeholders, geothermal-rich nations, and the forestenergy nexus with an eye towards promoting large-scale geothermal energy expansion.

The initiative aims to capitalise on environmental and economic potential by providing innovative solutions for low-carbon growth, energy security, and sustainable development through multi-stakeholder cooperation within and across countries.

Primarily, this will be achieved through the creation of enabling frameworks, enhanced stakeholder capacity, and the establishment of an industry-wide sustainability standard for geothermal energy systems that will be pilot-tested in showcase projects.

The Sustainability Standard for Geothermal Energy, which aims to be the best practice benchmark for the geothermal industry, hopes to mitigate environmental and socio-cultural impacts of geothermal energy development.

A key RoF strategy is building cooperation platforms among geothermal-rich countries in the developing world, starting with Indonesia and the Philippines and then expanding to other Pacific nations and geothermal-rich regions.

The ROF programme, a project of World Wildlife Fund (WWF) Philippines, WWF Indonesia and WWF Global Climate and Energy Initiative, aims to reach out to geothermal company through trade associations in the Philippines and Indonesia.

Towards this end, they hope to plan a forum, and maintain non-exclusive partnerships from the onset, making it clear that the programme is not aimed to promote individual companies.

“Rather (it) aims to enhance the social and environmental profile of the geothermal industry as partners in low-carbon development and biodiversity conservation,” the study suggests.

ROF acknowledged that inter-country cooperation in energy policy reform is a highly delicate matter.

“While developing countries can certainly learn from each other’s experiences in promoting renewable energy, the process must be transparent, mutually acceptable and respectful of one another’s sovereignty and local culture,” the case study details.

While adopting policy recommendations from other countries, they must always consider the local context in order to be effective.

ROF also acknowledges that the multi-stakeholder nature of RoF requires a delicate balancing act.

“The interests of all geothermal stakeholders, whether big or small, are considered in policy development, during the crafting and implementation of Sustainability Standards, and during the growth of the geothermal industry.”

Perhaps someday, like the Philippines and Indonesia, Malaysia’s geothermal industry too will benefit from the adoption of the ROF programme or the likes of it.

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