![]() ![]() ![]() Given the difference in market structure, it will be interesting to see how the VPPA concept will be rolled out.Īs a pilot initiative, three islands in Malaysia, namely Pulau Redang, Pulau Perhentian and Pulau Tioman, will become “green energy islands”. In contrast, VPPAs are designed for wholesale markets where the power producer sells electricity at the market price. It is pertinent to note that Malaysia’s electricity market operates on a single buyer model, with tariff rates for power producers fixed under their respective power purchase agreements with the utility company. This option will be introduced in the fourth quarter of 2022 and an initial quota of 600MW will be available for allocation. Procurement of green electricity via Virtual Power Purchase AgreementĬommercial consumers will have an option to procure green electricity by entering into a Virtual Power Purchase Agreement 2 (‘ VPPA’). It will be interesting to see how green hydrogen generation will be approached, as Malaysia’s RE framework does not presently cater to or consider the specific requirements and challenges of hydrogen projects. With the introduction of the Green Electricity Tariff (‘ GET’) programme in late 2021, it is possible that there will be an extension or variation of GET that will apply to data centres and consumers with similarly high electricity consumption. The enhancement of existing RE mechanisms was one of the considerations in Malaysia’s Renewable Energy Roadmap and it would seem that this is on its way to being implemented.Īmong the programmes envisaged are the development of solar parks, supply of green electricity to data centres, and green hydrogen generation. These include rooftop solar installations which currently fall under the Net Energy Metering (NEM) programme as well as the New Enhanced Dispatch Arrangement (NEDA). The allocation of the 1,200MW quota will be made through the following: Solar energy has been identified as a key renewable energy resource for Malaysia, and it is not surprising that it constitutes one of the focus areas for the new initiatives. The Malaysian Government has approved the allocation and redistribution of a 1,200 MW quota for solar resources. The Ministry of Energy and Natural Resources (‘ KETSA’) has since published a statement on these new initiatives 1, which are considered below.ĪLLOCATION AND REDISTRIBUTION OF 1,200MW FOR SOLAR RESOURCES At the fifth International Sustainable Energy Summit (ISES) 2022 which recently took place, Malaysia’s Prime Minister, Dato’ Sri Ismail Sabri bin Yaakob, announced several new initiatives to support Malaysia’s transition to sustainable energy. ![]()
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