Government to Strengthen Collaboration with TNB and Energy Commission for Renewable Energy Integration

Initiative to Enhance Grid Connectivity and Utilise Palm Oil Industry’s Renewable Energy Potential

The government will strengthen collaboration with Tenaga Nasional Bhd (TNB) and the Energy Commission (ST) to ensure that renewable energy generated from the palm oil industry can be effectively integrated into the national power system. This initiative is crucial for optimising Malaysia’s renewable energy potential and aligns with TNB’s long-term investment strategy in sustainable energy infrastructure.

Palm Oil Industry’s Renewable Energy Potential

The government recognises that palm oil by-products, such as mesocarp fibre, empty fruit bunches, and palm kernel shells, represent an untapped energy resource that can be converted into biomass energy, significantly contributing to the nation’s renewable energy goals. The palm oil sector has the potential to generate a significant amount of electricity, with each 60-tonne-per-hour mill capable of producing between 5 and 7 megawatts (MW) of electricity.

Challenges and Opportunities

One of the biggest challenges faced by the industry is the lack of grid connectivity, which prevents many mills from transmitting their excess energy. To resolve this, the government will work closely with TNB and ST to identify palm oil mills that are ready for grid integration and facilitate the necessary investments to connect them. This step is vital for ensuring that renewable energy from the palm oil sector can be fully utilised rather than wasted, helping Malaysia reduce its dependency on fossil fuels while improving energy security.

Private Sector Interest in Waste-to-Energy Investments

Private sector interest in waste-to-energy investments is growing, with companies willing to finance the development of energy infrastructure in the palm oil sector. There are already investors who have approached the government, stating that they are not necessarily interested in the palm oil business itself, but rather in the energy sector linked to palm oil waste. They see strong investment potential in turning palm biomass into electricity.

Replantation and Sustainability

Replantation is a critical component in ensuring the long-term sustainability and productivity of Malaysia’s palm oil industry. Increasing the replantation rate is essential, given the country’s commitment to zero deforestation and the need to boost yields without expanding land use. Unfortunately, Malaysia managed to replant only 114,000 hectares in 2024, a decline from the 132,000 hectares replanted in 2023. This falls significantly short of the recommended target of at least 4% per year, or approximately 255,000 hectares.

Supporting Smallholders

The government is prioritising the use of high-quality planting materials, ensuring that smallholders receive the preferred Tenera Hybrid instead of low-quality variants that could compromise long-term yields. Supporting smallholders, who manage about 1.5 million hectares of oil palm plantations, is also crucial. If smallholder yields could be increased by just 5 metric tons per hectare, Malaysia could boost crude palm oil production by 1.5 million metric tons, without requiring additional land.

Conclusion

The government’s initiative to strengthen collaboration with TNB and ST is a crucial step towards optimising Malaysia’s renewable energy potential. By resolving the challenges faced by the palm oil industry, the government can ensure that renewable energy is effectively integrated into the national power system, reducing the country’s dependency on fossil fuels and improving energy security.

FAQs

* What is the goal of the government’s initiative?
+ To strengthen collaboration with TNB and ST to ensure the effective integration of renewable energy from the palm oil industry into the national power system.
* What is the potential of the palm oil industry in terms of renewable energy generation?
+ Each 60-tonne-per-hour mill can generate between 5 and 7 megawatts (MW) of electricity.
* What is the current replantation rate in Malaysia?
+ Malaysia managed to replant only 114,000 hectares in 2024, a decline from the 132,000 hectares replanted in 2023.
* How can smallholders increase their yields?
+ By using high-quality planting materials, such as Tenera Hybrid, and receiving support from the government to improve their yields.