Transitioning the energy sector to achieve the 2030 Agenda for Sustainable Development and the objectives of the Paris Agreement presents a complex and difficult task for policymakers. It needs to ensure sustained economic growth as well as respond to increasing energy demand, reduce emissions and, more importantly, consider and capitalize on the interlinkages between Sustainable Development Goal 7 (SDG 7) and other SDGs. In this connection, ESCAP has developed the National Expert SDG Tool for Energy Planning (NEXSTEP). This tool enables policymakers to make informed policy decisions to support the achievement of the SDG 7 targets as well as Nationally Determined Contributions (NDCs) of the Paris Agreement. The initiative has been undertaken in response to the Ministerial Declaration of the Second Asian and Pacific Energy Forum (April 2018, Bangkok) and ESCAP Commission Resolution 74/9, which was endorsed by member States. NEXSTEP also garnered the support of the Committee on Energy in its Second Session, with recommendations to expand the number of countries being supported by this tool.
Iskandar Malaysia has been a participant of a collaborative project led by ESCAP and UNEP on SDG 7 localization. It aims to engage and support cities in defining, implementing and monitoring strategies for achieving global, national, and subnational Sustainable Development Goals. This Sustainable Energy Transition (SET) roadmap has been developed to identify technological options and policy measures that will help the economic region navigate the transition of its energy sector in line with the 2030 Agenda for Sustainable Development and the city’s own goals and targets.
Iskandar Malaysia has been a participant of a collaborative project led by ESCAP and UNEP on SDG 7 localization. It aims to engage and support cities in defining, implementing and monitoring strategies for achieving global, national, and subnational Sustainable Development Goals. This Sustainable Energy Transition (SET) roadmap has been developed to identify technological options and policy measures that will help the economic region navigate the transition of its energy sector in line with the 2030 Agenda for Sustainable Development and the city’s own goals and targets.
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Section 1
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A. Highlights of the Roadmap
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Iskandar Malaysia is a special economic region in the Southern Peninsular Malaysia, with a significant population and a competitive economy. It was established in 2006 with its development facilitated by the Iskandar Regional Development Authority (IRDA). In 2019, the population had reached 2.23 million while the GDP registered at $23.3 billion. The development of the region is guided by the Comprehensive Development Plan ii (CDPii) and other plans such as the Low Carbon Society Blueprint for Iskandar Malaysia 2025, which together aim to lead Iskandar Malaysia into a prosperous economic future with a healthy living ecosystem and a resilient environment.
Sustainability and climate change have been the central focus of Iskandar Malaysia’s development. For instance, initiatives have been launched to encourage sustainable energy use in the commercial built environment and the industry sector, which include the Green Accord Initiative Award (GAIA) and the Green Economy Guideline (GEG). Most notably, ongoing implementation of the Iskandar Malaysia Bus Rapid Transit (IMBRT) system is expected to bring in multi-fold benefits, such as reducing fuel demand and GHG emissions and easing traffic congestion.
This SET roadmap has two main objectives. Firstly, it aims to establish scenario baseline for the year 2019-2030, considering the current policy settings. Secondly, it identifies the measures and technological options that could raise Iskandar Malaysia’s efforts to align with the SDG 7 targets and the national climate goals. The three scenarios that are presented in detail in this roadmap are:
Sustainability and climate change have been the central focus of Iskandar Malaysia’s development. For instance, initiatives have been launched to encourage sustainable energy use in the commercial built environment and the industry sector, which include the Green Accord Initiative Award (GAIA) and the Green Economy Guideline (GEG). Most notably, ongoing implementation of the Iskandar Malaysia Bus Rapid Transit (IMBRT) system is expected to bring in multi-fold benefits, such as reducing fuel demand and GHG emissions and easing traffic congestion.
This SET roadmap has two main objectives. Firstly, it aims to establish scenario baseline for the year 2019-2030, considering the current policy settings. Secondly, it identifies the measures and technological options that could raise Iskandar Malaysia’s efforts to align with the SDG 7 targets and the national climate goals. The three scenarios that are presented in detail in this roadmap are:
- The current policy scenario (CPS), which has been developed based on existing policies and plans and used to identify the gaps in existing initiatives in aligning with the SDG 7 targets and the city’s ambitions.
- The sustainable energy transition (SET) scenario presents technological options and policy measures that will help the city to achieve its own goals and targets, enhance urban sustainability, as well as aligning with global goals and national unconditional NDC target.
- The conditional NDC (CNDC) scenario explores how the GHG emission reduction can be aligned with the national conditional NDC target through a higher share of local renewable energy generation.
Section 2
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B. Aligning Iskandar Malaysia’s energy transition pathway with the SDG 7 and NDC targets
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Iskandar Malaysia has already achieved universal access to electricity and clean cooking. The projected progress towards the remaining SDG 7 targets (i.e. renewable energy and energy efficiency), and the GHG emission trajectories of the three main scenarios (i.e. CPS, SET and CNDC scenarios) is summarized as follows.
Renewable Energy
The share of renewable energy (RE) in the total final energy consumption (TFEC) was 3.4 per cent in 2019. Under the CPS, the share of RE will increase to 7.4 per cent by 2030. The increase in the RE share under the current policies is driven by the high growth of renewable energy usage in the transport sector (i.e. biodiesel and bioCNG) and in grid electricity, relative to the slower growth in energy demand. In the SET scenario, RE share in TFEC is increased to 10.5 per cent by 2030. This is a result of both the increased renewable power generation and further reduction of energy demand due to energy efficiency measures. The local RE electricity generation is expected to contribute around 12 per cent of total electricity requirements, meeting the region’s RE target. In the CNDC scenario, the RE share in TFEC is further increased to 16.5 per cent as the amount of RE in electricity supply doubles. This doubling of RE electricity supply in this CNDC is required to align Iskandar Malaysia’s emission reduction with the national conditional NDC target, which aims to achieve an emission intensity reduction of 45 per cent, relative to the 2005 level.
Energy Efficiency
Iskandar Malaysia’s energy Intensity is estimated at 3.37 MJ/US$PPP,2011. The establishment of the IMBRT system is projected to reduce the energy consumption in CPS by about 790 ktoe compared to the BAU scenario, while small savings are projected to come from the promotion of energy efficient refrigerators and air conditioners under the national programmes. With that, the energy intensity is expected to decrease to 3.02 MJ/US$PPP,2011 by 2030, which corresponds to an average annual improvement rate of 2.5 per cent.
The SET scenario proposes several energy efficiency interventions across the demand sectors, which further decreases the energy intensity to 2.85 MJ/US$PPP,2011 by 2030. This corresponds to a 2.98 per cent reduction per annum, aligning with the suggested global annual improvement rate of 3 per cent(UNSD, 2021) . The biggest share of energy reduction comes from the proposed industrial energy saving measures, which is about 347 ktoe in 2030 or a 16 per cent reduction from the BAU/CPS baseline. Other priority areas include the commercial built environment. The adoption of energy audit in existing buildings and adherence to the Malaysia MS1525 building standards or a maximum Building Energy Index (BEI) of new buildings shall lead to substantial energy savings.Other measures include encouraging hybrid private passenger car adoption in the transport sector and more vigorous promotion of efficient household appliances including refrigerators, air conditioners, fans, and lighting. These are further detailed in Chapter 4. The energy intensity of the CNDC scenario is the same as SET scenario.
GHG emissions
The GHG emissions in 2019 are estimated at 21.6 MTCO2-e, which considers the direct fuel combustion from the demand sectors, emissions attributable to the purchased (grid) electricity, as well as to waste management. Figure ES 1 shows the GHG emission trajectories for the different scenarios. The GHG emissions from the CPS is projected to reach 31.4 MTCO2-e, while it is further decreased to 26.0 MTCO2-e in the SET scenario. This corresponds to an emission intensity of 0.2 ktCO2-e/ million RM.2005, a 37 per cent reduction from the 2005 level, aligning with the national unconditional NDC target.The CNDC scenario further raises the climate ambition to align with the national conditional NDC target by ramping up RE capacity within the economic region.
Renewable Energy
The share of renewable energy (RE) in the total final energy consumption (TFEC) was 3.4 per cent in 2019. Under the CPS, the share of RE will increase to 7.4 per cent by 2030. The increase in the RE share under the current policies is driven by the high growth of renewable energy usage in the transport sector (i.e. biodiesel and bioCNG) and in grid electricity, relative to the slower growth in energy demand. In the SET scenario, RE share in TFEC is increased to 10.5 per cent by 2030. This is a result of both the increased renewable power generation and further reduction of energy demand due to energy efficiency measures. The local RE electricity generation is expected to contribute around 12 per cent of total electricity requirements, meeting the region’s RE target. In the CNDC scenario, the RE share in TFEC is further increased to 16.5 per cent as the amount of RE in electricity supply doubles. This doubling of RE electricity supply in this CNDC is required to align Iskandar Malaysia’s emission reduction with the national conditional NDC target, which aims to achieve an emission intensity reduction of 45 per cent, relative to the 2005 level.
Energy Efficiency
Iskandar Malaysia’s energy Intensity is estimated at 3.37 MJ/US$PPP,2011. The establishment of the IMBRT system is projected to reduce the energy consumption in CPS by about 790 ktoe compared to the BAU scenario, while small savings are projected to come from the promotion of energy efficient refrigerators and air conditioners under the national programmes. With that, the energy intensity is expected to decrease to 3.02 MJ/US$PPP,2011 by 2030, which corresponds to an average annual improvement rate of 2.5 per cent.
The SET scenario proposes several energy efficiency interventions across the demand sectors, which further decreases the energy intensity to 2.85 MJ/US$PPP,2011 by 2030. This corresponds to a 2.98 per cent reduction per annum, aligning with the suggested global annual improvement rate of 3 per cent
GHG emissions
The GHG emissions in 2019 are estimated at 21.6 MTCO2-e, which considers the direct fuel combustion from the demand sectors, emissions attributable to the purchased (grid) electricity, as well as to waste management. Figure ES 1 shows the GHG emission trajectories for the different scenarios. The GHG emissions from the CPS is projected to reach 31.4 MTCO2-e, while it is further decreased to 26.0 MTCO2-e in the SET scenario. This corresponds to an emission intensity of 0.2 ktCO2-e/ million RM.2005, a 37 per cent reduction from the 2005 level, aligning with the national unconditional NDC target.The CNDC scenario further raises the climate ambition to align with the national conditional NDC target by ramping up RE capacity within the economic region.
Figure ES 1 Comparison of emissions by scenarios 2018-2030
Section 3
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C. Important policy directions
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The conditional NDC scenario is the most ambitious scenario proposed in this Roadmap, requiring a step-up in terms of energy efficiency improvement across all demand sectors. It also proposes a greater implementation of renewable electricity capacity within the city boundary, in allowing a 45 per cent reduction in GHG emission intensity by 2030, compared to the 2005 levels. Notwithstanding, the additional financial and environmental benefits to be realised, relative to the other scenarios, make it a pathway worth pursuing. As mentioned above, the measures proposed in the CNDC scenario raise the RE share from 3.4 per cent in 2019 to 16.5 per cent by 2030, at the same time, allowing a reduction in energy intensity at an annual average rate of 2.98 per cent. Most notably, it puts Iskandar Malaysia in alignment with the national goal, in terms of GHG emission intensity reduction. Additionally, the effort in increasing the share of local RE power generation in the overall electricity supply is expected to bring in substantial financial savings to the city, mainly through greater implementation of solar PV systems, which now provides the lowest levelized cost of electricity among other technologies.
The key policy recommendations to help Iskandar Malaysia to align its sustainable energy transition effort with the SDG 7 and NDC targets, particularly following the CNDC scenario, include:
The key policy recommendations to help Iskandar Malaysia to align its sustainable energy transition effort with the SDG 7 and NDC targets, particularly following the CNDC scenario, include:
- The industry sector should be encouraged to become more resource efficient, pivoting towards a circular industrial ecosystem. A national energy audit study shows that substantial energy savings can be realised in several industry sub-sectors, through the implementation of cost-effective energy efficiency measures. These include measures such as control efficiency improvement, equipment upgrades and alternative process design. Industry players should take a more active role in conducting regular energy audits and subsequently implementing the energy efficiency measures identified. They should also take advantage of the neat spatial planning of industrial clusters in Iskandar Malaysia to realize more industrial symbiosis going forward. Resource sharing between production facilities should be encouraged, transitioning from a linear industrial economy to a circular industrial economy.
- Sustainable transport measures are key to achieve substantial energy savings and emission reduction. The transport sector has the highest share of energy demand, making up around 53 per cent of the total energy demand and 34 per cent of the GHG emissions in 2019. Iskandar Malaysia’s progressive public transport system expansion is key in making the transport sector more sustainable. Additionally, active promotion of hybrid passenger cars will allow further reduction in energy usage and GHG emissions. Promotion of electric vehicles shall be done with caution, as the climate benefits of electric vehicle adoption are highly dependent on the emission intensity of the electricity supply.
- Substantial energy savings can be realised with energy efficiency improvement and energy efficient designs in the commercial built environment. Building standards in Iskandar Malaysia can be improved through mandatory adoption of energy audit practices in existing buildings. Additionally, the adherence to existing Malaysian MS1525 Building Standards or a maximum Building Energy Index (BEI) should be made compulsory, if possible. Shopping complexes should be made the number one priority as they make up around 65 per cent of the total energy demand of the commercial sector.
- Ramping up of local renewable power capacity is cost-effective and contributes towards the region’s climate change mitigation effort. A rapid ramp up of local RE capacity, particularly with solar PV technology, is required to achieve Iskandar Malaysia’s RE aspiration while aligning with the national unconditional and conditional NDC targets. As analysed, installing local solar PV distributed mini-grid networks and rooftop solar PV allow financial gains, compared to purchasing electricity from the central grid, and help avoid disrupting the restriction of a maximum 24 per cent RE share in the central grid. Waste-to-Energy technology should be considered as an alternative solid waste management solution to existing landfilling practice, providing socio-environmental benefits.