Malaysia is set to achieve its 40% renewable energy capacity target by 2035, according to new analysis by Power Technology’s parent company, GlobalData.
In 2021, the Ministry of Energy and Natural Resources of Malaysia (KeTSA) aimed to reach 31% renewable capacity by 2025 and 40% by 2035. Later, in the National Energy Policy (2022–2040), the government set a target to achieve 18.4GW of renewable capacity by 2040.
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Currently, 13.3% of the country’s total capacity is accounted for by renewables. If it continues its current rate of growth, Malaysia is expected to achieve 18.2% renewable capacity by 2025 and 36.4% by 2035, according to GlobalData.
The data and analytics company’s latest report – Malaysia Power Market Size, Trends, Regulations, Competitive Landscape and Forecast, 2024–2025 – claims that Malaysia is “rich in the untapped potential of renewable energy sources”, which it can develop “to achieve energy security while addressing climate change concerns”.
Sudeshna Sarmah, power analyst at GlobalData, said: “In 2016, Malaysia’s energy commission, Suruhanjaya Tenaga, introduced a large-scale solar programme with a total quota of 1.25GW allocated for the 2017–20 period, which resulted in the accelerated growth of grid-connected PV systems. Moreover, the Net Energy Metering programme led to the rise of a distributed renewable energy market.”
Currently, solar, biopower and small hydro generate most of the country’s renewable energy.
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By GlobalDataThe country only has one small onshore wind farm with a capacity of 0.2MW, as temperamental wind speeds during the off season in the region are not complementary to the power source. Nevertheless, according to GlobalData, “several small wind projects could still make a difference”.
GlobalData highlights that the Malaysian Government has advanced several efforts to support renewable energy in the country, including extending the Green Investment Tax Allowance and Green Income Tax Exemption until 2023. The government has announced an income tax exemption for solar leasing companies, which will run to December 2026.
