This will then allow Malaysia to harness its current strengths in O&G and other industries to deliver the proper profitability to the market
by AUFA MARDHIAH / pic BERNAMA
ENERGY transition is a critical component for Malaysia’s economy to advance to the next level, Economy Minister Mohd Rafizi Ramli (picture) said.
He added that energy transition is an impediment to economic diversification as it is part of attempting to integrate energy transition as a core agenda in the economy.
In terms of policy, Malaysia has launched the national energy policy last year which sets the exploration for the country towards a cleaner energy and green economy.
Rafizi added that the government is focusing on the roll-out of the National Energy Transition roadmap in the next six months as announced by Prime Minister (PM) Datuk Seri Anwar Ibrahim during the opening ceremony of the Energy Asia 2023 conference.
“The roadmap will set the pathways and give clarity about how we will be able to bring everything together — all the way from the legislative and regulatory framework to how the private sector can participate,” he said during a session at the conference recently.
Rafizi said there is a correct understanding that transitions have to strike a balance in the market for sustainability with affordability and availability in the global context.
In Malaysia, he said it is easier to convince the population of the need for energy transition because climate change is real and is happening hence, the public’s realisation towards the importance of energy transition has to happen within the costs of making sure that Malaysia’s infrastructure is climate-proof in the future.
On that, he said the government is focusing on unwinding Malaysia’s complex system, for instance, the blanket fuel subsidy which has been a feature of the Malaysian economy for decades.
“Trying to slowly bring everyone on board to phase out the blanket subsidy system towards a targeted subsidy system is not an easy task,” he said.
On the other hand, he also noted that it is a challenge to strike a balance between financing and capability.
“In an economy like Malaysia, the government has built and planned for a phase down (phase by phase) transition to ensure appropriate financing and fiscal policy in place, as well as appropriate incentives for society to shift away from fossil fuels and towards green energy in stages,” he added.
Aside from that, the transition should ensure that Malaysia can harness its current strengths in oil and gas (O&G), and other industries to deliver the proper profitability to the market to establish green economies and energy transitions.
“At the end of the day, the public has to feel the change in energy transition. They need to appreciate that we are managing the climate, but at the same time, they need to be part of that economy.
“They need to see how their life could be upgraded and have greater access to affordable electricity and power in the future. Most importantly, they need to feel that the cost is justified,” he added.
Separately, in reaction to the PM’s remark that global transformation should not be dictated by certain countries, Rafizi highlighted the necessity to acknowledge that different countries are at different phases of development.
“While the net zero commitment is a global aspiration, as well as it being our commitment to achieve it by 2050, we also have to make sure that it balances with our society’s needs so that the transition does not abruptly disrupt energy supply.
“That is why we must maintain this faced down approach rather than abrupt quitting of any particular fossil fuel,” he said.