Decarbonisation and Targeted Subsidies: A Balancing Act
The government’s decision to implement targeted subsidies for renewable energy is a significant step towards reducing the country’s reliance on fossil fuels and achieving decarbonisation. According to Natural Resources and Environmental Sustainability Minister Nik Nazmi Nik Ahmad, the goal is to encourage more Malaysians to switch to renewable energy options that are more attractive and cost-effective.
Prior to Targeted Subsidies, Malaysians Relyed on Fossil Fuels
Nik Nazmi explained that prior to the targeted subsidies, the public would rely on petrol or diesel because it was cheap. However, the government wants to reduce this reliance on fossil fuels and transition to renewable energy options. By purely not subsidising fossil fuels anymore, the transition can be seen happening, Nik Nazmi believes.
Renewable Energy Costs Less than Fossil Fuels
A recent global study has shown that renewable energy now costs less than fossil fuels in the Asia Pacific region, with solar energy being the least expensive source of power. Fossil fuels, on the other hand, will continue to become more expensive. This makes renewable energy a more attractive option for Malaysians.
Electric Vehicles and Decarbonisation
Nik Nazmi also hopes that last year’s removal of subsidies for RON97 and diesel will encourage the more affluent Malaysians to purchase electric vehicles (EVs) to manage the higher fuel prices. Getting Malaysians to opt for renewable energy and switch to EVs will help with the country’s decarbonisation journey, a topic dear to him.
National Decarbonisation Committee
Nik Nazmi currently chairs the national decarbonisation committee, which aims to expedite the establishment and adoption of decarbonisation initiatives. The committee’s goal is to make Malaysia a leader in sustainable development and to reduce the country’s carbon footprint.
The Challenges of Targeted Subsidies
However, Nik Nazmi admits that the targeted subsidy initiative was not an easy decision to make in view of the political repercussions. With targeted subsidies for RON95, used by a majority of Malaysians, to be enforced later this year, Nik Nazmi says it is a whole different ballgame. He is well aware that this topic is a sensitive issue, having been part of the opposition before joining the government.
Lessons from London’s Ultra-Low Emission Zone
Nik Nazmi cites an excerpt from his book, "Saving the Planet: Climate and Environmental Lessons from Malaysia and Beyond", to highlight the backlash faced by London mayor Sadiq Khan when he expanded the ultra-low emission zone policy in the British capital. The policy, which charges a daily surcharge to enter the zone, led to a narrow by-election victory for the Conservative party, which turned it into a referendum of Khan’s ULEZ policy.
Conclusion
Despite the challenges and risks involved, Nik Nazmi believes that the targeted subsidy initiative is necessary for the country’s treasury, environment, and decarbonisation journey. The government’s goal is to make Malaysia a leader in sustainable development and to reduce the country’s carbon footprint.
Frequently Asked Questions
Q: What is the goal of the targeted subsidy initiative?
A: The goal is to encourage Malaysians to switch to renewable energy options that are more attractive and cost-effective.
Q: What is the current situation with RON95 and diesel subsidies?
A: The government has already removed subsidies for RON97 and diesel, and targeted subsidies for RON95 will be enforced later this year.
Q: What is the role of the national decarbonisation committee?
A: The committee aims to expedite the establishment and adoption of decarbonisation initiatives to make Malaysia a leader in sustainable development and reduce the country’s carbon footprint.
Q: What are the challenges of the targeted subsidy initiative?
A: The initiative is a sensitive topic, and Nik Nazmi acknowledges that there is a risk of political backlash and potential defeat in the next election.