What Malaysia’s new energy efficiency policy means for your bills, appliances

KUALA LUMPUR, Sept 2 — Malaysia’s new energy-efficiency plan aims to cut energy demand by 11.6 per cent by 2035, while generating RM85 billion in projected energy-cost savings and 815,000 terajoules (TJ) in cumulative energy savings.

But what do those numbers actually mean for ordinary Malaysians?

The National Energy Efficiency Policy and Action Plan (NEEAP) 2.0 sets out Malaysia’s targets for using energy more efficiently across households, businesses and industry, with the government also expecting RM36 billion in private investment, about 29,000 jobs and 26 million tonnes of avoided carbon dioxide equivalent (CO2e) emissions by 2035.

How big are those numbers?

The projected 815,000 TJ in cumulative energy savings is equivalent to the energy needed to meet Peninsular Malaysia’s entire electricity supply needs for nearly two years, according to the Ministry of Energy Transition and Water Transformation (Petra).

The projected 26 million tonnes of avoided CO2e emissions is roughly equivalent to the annual emissions of 5.7 million cars, based on an illustrative comparison using previously reported calculations by the Malaysian Green Technology and Climate Change Corporation (MGTC).

What does it mean for households?

One of the biggest changes under NEEAP 2.0 is that energy efficiency will cover electricity, gas and thermal energy consumption, rather than focusing solely on electricity.

Economy Minister Akmal Nasrullah Mohd Nasir said the plan would introduce energy-saving measures across the industrial, commercial and domestic sectors.

 “It’s not enough to focus solely on the electricity segment.

“The NEEAP 2.0 will cover both electrical and thermal energy, with energy-saving measures across the industrial, commercial and domestic sectors.

“For consumers, one of the more visible changes could involve energy-efficient appliances,” he told Malay Mail.

Malaysia already uses energy-efficiency ratings for products such as refrigerators and air-conditioners, but Akmal said the government intends to improve the rating system and extend it to more consumer products.

“But the aim is not simply to add more ratings.

“It is also to change consumer behaviour by helping people understand how much energy different products consume and make more informed choices.

“In other words, NEEAP 2.0 does not simply mean households will be told to use less electricity. It is also about using energy more efficiently,” he added.

Will this make electricity bills cheaper?

Not necessarily.

NEEAP 2.0 is not a policy to directly reduce electricity tariffs, but the government expects greater energy efficiency to reduce the amount of energy households and businesses need, potentially lowering their energy costs.

Akmal said energy efficiency could involve using less energy, while for industries it could also mean producing more with the same amount of energy through more efficient equipment.

“Energy saving can also mean same cost but higher production output because you are getting more effective equipment.

“For households, however, the amount saved would depend on factors such as the appliances they use and their energy-consumption behaviour,” he said.

He also pointed to existing off-peak electricity rates as another way consumers can manage their energy use and costs.

So the RM85 billion projected under NEEAP 2.0 should not be interpreted as RM85 billion being deducted from household electricity bills.

Instead, it is an economy-wide estimate of energy-cost savings resulting from improved efficiency.

When will Malaysians feel the changes?

There will be no single date when NEEAP 2.0 suddenly changes consumers’ daily lives.

Akmal said energy efficiency would be a continuous effort through 2035, with different programmes and measures introduced progressively.

For households, this could include changes to appliance efficiency standards and labelling, giving consumers more information about the energy performance of products.

For larger energy users, the Energy Efficiency and Conservation Act introduces requirements such as energy management, reporting and audits once prescribed energy-use thresholds are reached.

Why does energy efficiency matter?

Malaysia’s energy demand is expected to continue growing as the economy expands.

Akmal said the country therefore needs to focus not only on shifting towards cleaner energy sources, but also on optimising how much energy it consumes.

That is important to Malaysia’s commitment to achieving net-zero emissions by 2050, he said.

NEEAP 2.0 is therefore intended to complement the country’s wider energy transition by improving how efficiently energy is used, alongside efforts to change where that energy comes from.

Akmal described energy efficiency and conservation as the “lowest hanging fruit” for Malaysia to tackle.

Ultimately, the policy is about getting more out of the energy Malaysia already uses — whether that means a household choosing a more efficient appliance or an industrial company producing more with the same amount of energy.