SHAH ALAM - Former Umno youth chief Khairy Jamaluddin said there are two structural constraints to a successful energy transition for phase 2 of the National Energy Transition Roadmap (NETR).
Khairy said the first constraint from a structural standpoint was related to electricity generation at the moment.
"If I’m not mistaken, over half of the electricity generated used non-eco friendly sources such as coal.
"During a discussion, Natural Resources, Environment and Climate Change Minister Nik Nazmi Nik Ahmad has not given an answer yet on how to decommission the coal plants.
"There was an agreement on the plants known as the power purchase agreement with a long period. If we want to decommission the coal plants, a compensation must be paid,” he said during the Keluar Sekejap podcast with former Umno Information chief Shahril Sufian Hamdan, today.
On May 30, Economy Minister Rafizi Ramli said Malaysia was prepared to launch the NETR in phases starting June, putting the country’s net zero ambition into action by identifying key impact initiatives and implementation plans for the next two decades.
Rafizi said the roadmap outlined the government’s move to achieve its renewable energy (RE) capacity target of 70 per cent by 2050.
Khairy said previously, Nik Nazmi said he had the formula to offer independent energy producers (IPPs), which was a new agreement for them to build and operate plants dominated by the renewable energy industry (RBI).
"However, there is no certainty yet. So that becomes a constraint in the structuring of our energy transition," he said.
The second constraint, he said involved subsidy prices.
"As long as there are subsidised fossil fuel for example subsidised petrol by the government, then the incentive to change or purchase an electric car would not be that high.
"It’s not the matter of communication with the public on the issue, but this is directly related to the incentive system. This means that there is no incentive,” he said.