R 290854Z MAY 09
FM AMEMBASSY KUALA LUMPUR
TO SECSTATE WASHDC 2784
INFO ENVIRONMENT SCIENCE AND TECHNOLOGY COLLECTIVE
DEPT OF ENERGY WASHINGTON DC
ASEAN MEMBER COLLECTIVE

UNCLAS KUALA LUMPUR 000420 
 
 
SENSITIVE BUT UNCLASSIFIED 
 
STATE FOR OES/STC FOR BHOWARD, TSCOTT 
STATE FOR EAP/RSP WBEHN 
STATE FOR BKK/REO HHOWARD 
STATE FOR NSF/LWEBER 
STATE FOR TDA/ 
 
E.O. 12958: N/A 
TAGS: ENRG SENV TRGY PGOV MY
SUBJECT: ENERGY AND GREEN TECHNOLOGY IN MALAYSIA 
 
REF: 2009 Kuala Lumpur 148 
 
¶1. (SBU) SUMMARY:  LOO Took Gee, Deputy Secretary-General for Energy 
at the newly established Ministry of Energy, Green Technology, and 
Water (MEGTW), does not foresee any major shifts in Malaysia's 
energy sector even as electricity demand is expected to double by 
¶2030.  Malaysia will continue to pursue primarily gas and coal 
energy sources with some increased reliance on hydropower and 
biofuel from palm oil.   Tenaga Nasional Berhad, the sole 
electricity provider in peninsular Malaysia, is continuing to push 
for Malaysia's first nuclear power plant.  However, even if a plant 
is approved by the government, Loo said it would not be online until 
2025 at the earliest. 
 
¶2. (SBU) COMMENT:  The addition of green technology to the 
ministry's name appears to be more about rebranding than redirection 
at this point.  Loo does not anticipate a strong shift in MEGTW 
policy; there are no planned increases in pollution controls. 
However, the gradual phase out of oil and gas subsidies should 
create a strong incentive in the market for increased efficiency and 
alternative sources.  Malaysia is taking measured steps toward 
greening the energy sector that will take advantage of domestic 
resources while still providing some opportunities for U.S. 
cooperation and commercial involvement.  END SUMMARY AND COMMENT. 
 
--------------------------------------------- --- 
THE MINISTRY OF ENERGY, GREEN TECHNOLOGY & WATER 
--------------------------------------------- --- 
 
¶3. (SBU) Prime Minister Najib announced on April 9 that the Ministry 
of Energy, Water, and Communication (MEWC) would be renamed the 
Ministry of Energy, Green Technology, and Water.  The communications 
aspect of MEWC was moved under the Ministry of Information, 
Communications, and Culture.  MEGTW also received a new minister, 
Peter CHIN Fah Kui, who had been serving as the Minister of 
Plantation Industries and Commodities since March 2004. 
 
¶4. (SBU) Loo confirmed to ESTHoff in a meeting on May 28 that the 
reorganization of the ministry was a surprise to her and those in 
the ministry.  She indicated that the move was made by the prime 
minister himself.  Current outlays for the ministry have not changed 
and Loo did not expect any significant increase in funding to deal 
with the new green technology aspect of the ministry this fiscal 
year.  Loo stated that the former MEWC had always been involved in 
green technologies and this reorganization merely meant MEGTW would 
"double its efforts" in that regard. 
 
----------------- 
AN HONEST OUTLOOK 
----------------- 
 
¶5. (SBU) Loo does not foresee any major shifts in Malaysia's energy 
sector even as electricity demand is expected to double by 2030. 
Currently Malaysia's electricity production comes primarily from gas 
(about 50%), coal (about 35%), and hydro (about 14%).  Tenaga 
Nasional Berhad (TNB), the sole electricity provider in peninsular 
Malaysia, is continuing a protracted effort to build Malaysia's 
first nuclear power plant (see reftel).  The head of TNB's Nuclear 
Energy Unit Dr. Mohd Zam Zam Jaafar claims that the unit has a 
"mandate" from TNB's board, which is chaired by former MEWC Minister 
Tan Sri Leo Moggie, to move ahead with plans to build a nuclear 
reactor.  Former Prime Minister Mahatir Mohamad is publicly urging 
the government and TNB to not build a plant, citing safety concerns. 
 Malaysia does not currently have a national nuclear policy and the 
government has not yet ruled on whether or not the plant should be 
constructed.  Loo did not indicate when a decision on the plant 
might be made but local media reports say it could be soon. 
However, even if a plant is approved, Loo said it would not be 
online until 2025 at the earliest. 
 
¶6.  (SBU) Loo was bearish on the prospects for renewable energy 
sources in Malaysia.  Hydro projects would continue including the 
controversial Bakun Dam project in Sarawak.  This dam will create 
far more power than Sarawak can currently use.  As such, MEGTW is 
planning an underwater transmission cable to connect the peninsula 
and Borneo.  This cable would transmit around 10,000 megawatts of 
electricity to the peninsula.  There are also plans to sell this 
power to Indonesia. 
 
¶7.  (SBU) Loo said solar and wind power are still too expensive. 
Malaysia is already pursuing several biomass power plants with the 
hopes of using empty fruit bunches (EFB) from the palm oil industry 
as fuel.  Loo stated that all of these power plants are having 
serious technical problems due to too much moisture in the EFB fuel. 
 While the EFB can be dried, this dramatically decreases the 
efficiency. 
As such, Loo said MEGTW would focus on efforts to 
increase energy efficiency from current sources rather than make 
large investments in nascent renewable energy technologies.  A 
gradual phase out of oil and gas subsidies is planned to be 
concluded in the next couple years, providing a market incentive to 
bolster the efficiency policy. 
 
-------------------------------- 
ROOM FOR INCREASED COLLABORATION 
-------------------------------- 
 
¶8. (SBU) Loo was eager to have increased interaction with the U.S. 
Minister Chin will be traveling to Mexico in March 2010 and is 
already planning on making a visit to the U.S.  Loo requested Post's 
assistance in arranging an exchange with energy policy and 
regulatory agencies in the U.S., particularly the California Energy 
Commission.  In addition, Loo said a U.S. bid on the Bakun Dam 
underwater cable would be welcomed.  Post will follow up on these 
opportunities for cooperation with MEGTW and provide additional 
details to the Department and Washington agencies. 
 
KEITH