Carbon capture and floating solar farms under the prime minister’s strong leadership

Malaysia promotes renewables despite abundant resources and rising demand

Malaysia has an abundant supply of natural resources, with coal and gas-fired power generation accounting for 80 percent of its electricity. It is also known for its sizeable liquefied natural gas (LNG) industry, with Japan as its largest export destination. “You could say that bilateral relations were built on natural resources, especially LNG,” says ABE Ryoichi, former JBIC Chief Representative in Singapore, whose office also oversees Malaysia. Things started to change around 2020.

In September 2021, the Malaysian government declared that it would achieve net-zero emissions by 2050. In 2023, it drew up a specific roadmap to meet this goal, which ABE says truly breathed life into its decarbonization efforts. Under the strong leadership of Prime Minister Anwar, “The ministries and state-owned companies have started taking action.”

The recent surge in the construction of data centers is expected to significantly increase electricity demand, and the central policy is to respond by increasing the use of renewable energy. “Investment in floating photovoltaic systems is gaining momentum. Malaysia has an abundance of dam reservoirs for hydropower generation, and solar panels are being placed on their surface.”

Another promising technology is CCUS (carbon dioxide capture, utilization, and storage). It involves storing CO₂ underground in cavities created by the extraction of natural gas and other resources. If commercialized, the technology could also store CO₂ transported from Japan and Singapore, presenting a significant business opportunity.

JBIC is boosting AZEC-related activities in Malaysia in three key areas: data center and digital industry support, power grid development, and CCUS. While leveraging its natural resources, Malaysia will continue rising to meet its challenges.

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