Energy Law at Malaysia
Here’s an overview of Energy Law in Malaysia:
Energy Law in Malaysia
Malaysia’s energy sector is governed by a combination of federal laws, regulations, and policies designed to regulate the production, distribution, and consumption of energy resources, including oil, gas, electricity, and renewable energy. The country is a significant producer of oil and gas and is also advancing renewable energy development.
🔹 Key Legal Framework
Electricity Supply Act 1990
Governs the generation, transmission, distribution, and supply of electricity in Peninsular Malaysia and Sabah.
Gas Supply Act 1993
Regulates the importation, transportation, distribution, and supply of gas.
Energy Commission Act 2001
Establishes the Energy Commission (Suruhanjaya Tenaga) as the regulator for the electricity and gas industries in Peninsular Malaysia and Sabah.
Petroleum Development Act 1974
Governs the exploration, development, and production of petroleum resources in Malaysia. It vests ownership of petroleum resources in PETRONAS (Petroliam Nasional Berhad), the national oil company.
Renewable Energy Act 2011
Provides the legal basis for promoting renewable energy, including the Feed-in Tariff (FiT) mechanism to encourage renewable energy projects.
Environmental Quality Act 1974
Governs environmental protection and mandates Environmental Impact Assessments (EIA) for energy projects.
🔹 Regulatory Authorities
Energy Commission (Suruhanjaya Tenaga)
Main regulator overseeing electricity and gas industries — licensing, tariffs, safety, and standards.
PETRONAS
National oil and gas corporation with exclusive rights to petroleum resources under the Petroleum Development Act.
Sustainable Energy Development Authority (SEDA)
Implements renewable energy policies and administers the Feed-in Tariff system.
🔹 Key Features
Electricity Sector:
Liberalized generation sector with independent power producers (IPPs).
Single buyer model with Tenaga Nasional Berhad (TNB) as the main utility and grid operator.
Tariff regulation by the Energy Commission.
Oil and Gas Sector:
Exploration and production managed primarily by PETRONAS.
Licensing and contracts (Production Sharing Contracts or PSCs) regulate upstream activities.
Renewable Energy:
Feed-in Tariff (FiT) system to encourage renewable energy projects like solar, biomass, biogas, and mini-hydro.
Net energy metering and large-scale solar (LSS) schemes to promote distributed generation.
Energy Efficiency:
Energy management and conservation encouraged through voluntary and regulatory measures.
Environmental Regulation:
Energy projects must comply with EIAs and pollution control standards.
🔹 Recent Developments
Malaysia is pushing to increase renewable energy’s share in the energy mix under its National Renewable Energy Policy and Action Plan.
Greater focus on energy transition, including electric vehicles and smart grid technologies.
Strengthening regulations on energy efficiency and sustainable development.
Exploration of hydrogen energy and carbon capture technologies.
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