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Energy efficiency researched for Malaysian energy distribution
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Coordinator: Dr. Lu Aye Department of Civil and Environmental
15 MAY 2007[Energy Efficiency Technology] | 421‐629
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY
DEMAND IN INDUSTRIAL SECTOR
[Vigneswaran KUMARAN] | 277492
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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Abstract
This report attempts to delineate the impact of Energy Efficiency Technologies (EET) in the
Industrial Sector in Malaysia vis‐à‐vis the future energy demand. A holistic approach was
envisaged to demonstrate the paramount importance of evolving Malaysian energy policies
inter alia the energy production, consumption and management, and thus in the
culmination of energy efficiency technology policies. In order to generate an exclusive
analysis of future energy demand and quantify this in respect to implementation of EET in
the industry, a statistical assumption was made to apply the Pareto rule and Simple Ratio
method. Additionally, case studies modeled by the Malaysian government for
implementation of EET in industry were used to complement the available fiscal and energy
data for quantitative impact analysis.
Keywords: Energy efficiency technologies, industrial sector, future energy demand, case
studies, quantitative impact analysis
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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Aim
The method and approach integrated in generating this report is designed to meet the following objectives:
• Outline the National Energy Policy development vis‐à‐vis Energy Efficiency Technology (EET)
• Provide a distilled Energy Supply and Demand analysis for Industrial Sector
• Describe the present Energy Efficiency Technology in Industry
• Quantify the future Energy Demand due to the impact of EET
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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Contents
Abstract 2
Aim 3
1.0 Introduction 7
2.0 Energy Policy Development 10
3.0 Energy Demand and Supply 12
4.0 Energy Efficiency Technology (EET) in Malaysian Industry 14
5.0 Case Study of EET Model in Industry 16
6.0 Future Energy Demand: Quantitative Analysis 17
7.0 Conclusion 20
References and Notes 21
Appendix
A1 22 Examples of Energy Efficiency Technology
A2 act 23 Energy Demand Curve Estimates without EET Imp
A3 24 Energy Demand Curve Estimates with EET Impact
A4 25 Energy Savings and Quantitative Analysis Calculations
A5 acity 26 Energy Generation Mix and Power Producers’ Cap
A6 tion 27 Generation Mix and Power Producers’ Genera
A7 Sales of Electricity and Electricity Consumers 28
Figures Figure 1 Industrial Fuel Intensity in Selected ASEAN Countries 1980‐2000 13
Figure 2 Energy Demand Curve (without EET) from 1990 to 2000 23
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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Figure 3 Energy Demand Estimates (without EET) from 2010 to 2020 23
Figure 4 Energy Demand Estimates with EET Impact from 2010 to 2020 24
Tables Table 1 Final Commercial Energy Demand by Source 8
Table 2 Final Commercial Energy Demand by Sector 9
Table 3 Primary Commercial Energy Supply by Source 12
Table 4 Applicable Energy Efficient Technology for Malaysian Industry (MIEEIP Model) 14
Table 5 Energy Efficient Application in MIEEIP Industry Model (Case Studies) 16
Table 6 Potential Energy and Cost Saving 22
Table 7 List of EE Project for Second Phase of MIEEIP’s Demonstration Project 22
Glossary
CHP: Combined Heat and Power
EET: Energy Efficiency Technology
EPU: Economic Planning Unit
EIB: Energy Information Bureau
GDP: Gross Domestic Product
MIEEIP: Malaysian Industrial Energy Efficiency Improvement Project
OECD: Organisation of Economic Cooperation and Development
PTM: Malaysian Energy Centre
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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1.0 INTRODUCTION
“Energy can neither be created nor destroyed”. It is an accepted empirical principle referred
to as First Law of Thermodynamics. Theoretically, the world shall never run out of energy
source. However, the availability of energy in its various physical forms, which have been
indiscriminately consumed by generations of civilization, can and will deplete. This applies
in particular to the energy sources from exhaustible mass such as fossil fuel and minerals.
Therefore, the scrupulous use of this energy sources instrumented by efficient technologies
is crucial to the existence and sustainable growth of any nation, and more so for a
developing country. Importantly, energy efficiency technology offers a powerful and cost‐
effective tool for achieving a sustainable energy future [1].
A developing nation such as Malaysia, with strategic geographical location historically (Map
1) and exemplary political stability, increases its vulnerability to energy supply and demand
equilibrium in the absence of succinct energy policy.
Map1: Peninsular Malaysia, Sabah and Sarawak
Source: CIA World Factbook
A negative imbalance in this equilibrium, can adversely impact the sustained 6.5 % gross
domestic product (GDP) growth achieved by Malaysia over the past 50 years of post‐
independent [2].
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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Malaysia is a country with diverse energy sources, both renewable and non‐renewable, such
as petroleum, coal, coke, natural gas and hydroelectric. Its current population of 26.5 million
[3] is estimated to reach 28.96 million in the year 2010, with an average growth projection
of 1.6 % per year [4]. This expansion in population growth has strain on energy demand and
energy intensity. Malaysian statistic reveals that per capita consumption has increased to
62.2GJA1 (2005) from 52.9GJA (2000), and estimated to reach 76.5GJA in the year 2010
(refer Table1).
Table 1: Final Commercial Energy Demand1 By Source
PJ % PJ % PJ % PJ % PJ %SourcePetroleum Products 414 74.9 676 72.8 820 65.9 1023.1 62.7 1372.9 61.9Natural Gas2 45.7 8.3 81.1 8.7 161.8 13.0 246.6 15.1 350 15.8Electricity 71.8 13.0 141.3 15.2 220.4 17.7 310 19.0 420 18.9Coal & Coke 21.5 3.9 29.8 3.2 41.5 3.3 52 3.2 75 3.4Total 553 100 928.2 100 1243.7 100 1631.7 100 2217.9 100Per Capita Consumption (GJ) 29.9 44.3 52.9 62.2 76.5Source of compilation: Malaysia Seventh (1996-2000), Eighth (2001-2005) and Ninth (2006-2010) Plan, Economic Planning Unit (EPU), Malaysia1 Refers to the quantity of commercial energy delivered to final consumers but excludes gas, coal and fuel oil used in electricity generation2 Includes natural gas used as fuel and feedstock consumed by the non-electricity sector
1990 1995 2000 2005 2010
This increase in demand will deplete the countries non‐renewable resources by 2217PJA2, of
which 45% will be from oil and petroleum reserves, while another 42% is derived from
natural gas reserves. At present, the industrial sector is the second largest energy consumer
(lagging the transport sector by mere 1.9%), at 38.6% of the total energy mix for the country
(refer Table2).
1 GJA as Gigajoules Per Annum 2 PJA as Petajoules Per Annum
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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Table 2: Final Commercial Energy Demand by Sector
PJ % PJ % PJ % PJ % PJ %SectorIndustrial1 213.5 38.6 337.5 36.4 477.6 38.4 630.7 38.7 859.9 38.8Transport 220.9 39.9 327.8 35.3 505.5 40.6 661.3 40.5 911.7 41.1Residential & Commercial 67.3 12.2 118.8 12.8 162 13.0 213 13.1 284.9 12.8Non-Energy2 18.5 3.3 125.4 13.5 94.2 7.6 118.7 7.3 144.7 6.5Agriculture & Forestry 32.8 5.9 18.7 2.0 4.4 0.4 8 0.5 16.7 0.8Total 553 100.0 928.2 100.0 1243.7 100 1631.7 100 2217.9 100Source for compilation: Malaysia Seventh (1996-2000), Eighth (2001-2005) and Ninth (2006-2010) Plan, Economic Planning Unit (EPU), Malaysia1 Includes manufacturing, construction and mining2 Includes natural gas, bitumen, asphalt, lubricants, industrial feedstock and grease
1990 1995 2000 2005 2010
Against a global backdrop with an average world economic growth of 3.8 percent over a
projection period until 2030 [5], Malaysia with sustained average GDP of 6.5 percent will
potentially outpace the global energy demand growth and its energy supply capacity if
stringent measures of energy management are not applied.
Thus it is imperative that improvement in the efficient use of energy in all sectors and
particularly the industrial, (which contributes more than a third of the GDP) is achieved to
lower the impact on costly energy demand. As such, the Government of Malaysia has,
throughout the years been actively evolving the nation’s energy policy to meet the
increasing demand in general energy utilization.
The Government of Malaysia had introduced policies for energy efficiency program
implementation, apart from the use of alternative and renewable energy sources in the 7th
Malaysia Plan, 1996‐2000 [6]. This has been a clear indication of the government’s stance in
ensuring that the energy related industries and energy end‐users will enhance their efficient
production and utilization of energy.
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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2.0 ENERGY POLICIES DEVELOPMENT
In order to comprehend the present situation of energy efficiency technology practice in
Malaysia, it would be worthy to have a brief understanding of how the overall national
energy policies evolved from the early 1970, as the nation began to experience the uprising
tide of global economic expansion as well as the imminent international oil crisis.
The following chronology highlights major energy policies development in Malaysia until the
culmination of energy efficient sub‐policy [7]:
• Petroleum Development Act 1974 – The establishment of Petronas as the national
oil company which was vested with the sole responsibility for exploration,
development, refining, processing, manufacturing, marketing and distribution of
petroleum products.
• National Energy Policy 1979 – Sets the overall energy policy with broad guidelines on
long‐term energy objectives and strategies to ensure efficient, secure and
environmentally sustainable supplies of energy. The three primary objectives of
National Energy Policy encircle supply, utilization and environmental aspect of
energy.
• National Depletion Policy 1980 – Introduced to safeguard the exploitation of natural
oil reserves because of the rapid increase in the production of crude oil. The
production of oil and gas was reduced significantly to cater for future generations
use.
• Four Fuel Diversification Policy 1981 – Designed to prevent over‐dependence on oil
as the main energy resource, its aim was to ensure reliability and security of the
energy supply by focusing on four primary energy resources: oil, gas, hydropower
and coal. This policy was mooted by the international oil crisis in 1979 and the leap in
oil prices subsequently.
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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• Fifth Fuel Policy (Eighth Malaysia Plan 2001‐2005) – In the Eighth Malaysian Plan,
Renewable Energy was announced as the fifth fuel in the energy supply mix.
Renewable Energy is being targeted to be a significant contributor to the country's
total electricity supply. With this objective in mind, greater efforts are being
undertaken to encourage the utilization of renewable resources, such as biomass,
biogas, solar and mini‐hydro, for energy generation.
• Energy Efficiency and Renewable Energy (Ninth Malaysia Plan 2006‐2010) ‐ The Ninth
Plan strengthens the initiatives for energy efficiency and renewable energy put forth
in the Seventh and Eighth Malaysia Plan that focused on better utilisation of energy
resources. An emphasis to further reduce the dependency on petroleum provides for
more efforts to integrate alternative fuels.
The culmination of energy efficiency policy marks a new beginning in the Malaysian energy
generation and consumerism. The policy sets forth to regulate and enhance the efficient use
of energy in all aspects of industrial and commercial business via the promotion of energy
efficiency technology.
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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3.0 ENERGY DEMAND AND SUPPLY
Energy demand and supply has increased by more than 60 % within the last 15 years (Table
2 and Table 3), and expected to increase further by 2010. The Industrial Sector (mining,
manufacturing and electricity) has been the largest consumer until recently, been surpassed
by the Transport Sector.
Table 3: Primary Commercial Energy Supply1 by Source
PJ % PJ % PJ % PJ % PJ %SourceCrude Oil & Petroleum Products 520.2 71.4 702.2 54.3 988.1 49.3 1181.2 46.8 1400 44.8Natural Gas2 114.4 15.7 459.5 35.5 845.6 42.2 1043.9 41.3 1300 41.6Hydro 38.3 5.3 64.5 5.0 104.1 5.2 230 9.1 350 11.2Coal & Coke 55.5 7.6 67.5 5.2 65.3 3.3 71 2.8 77.7 2.5Total 728.4 100 1293.7 100.0 2003.1 100.0 2526.1 100.0 3127.7 100.0Source for compilation: Malaysia Seventh (1996-2000), Eighth (2001-2005) and Ninth (2006-2010) Plan, Economic Planning Unit (EPU), Malaysia1 Refers to the supply of commercial energy that has not undergone a transformation process to produce energy. Non-commercial energy such as biomass and solar have been excluded2 Excludes flared gas, reinjected gas and exports of liquefied natural gas
1990 1995 2000 2005 2010
However, the percentage of energy consumed by industry is approximately 62 % of the total
energy used in Malaysia, since 50.6 % of electricity3 is consumed by industrial sector (refer
Chart 4 and Chart 5) in addition to the 38.7 % of primary energy. Hence, the Industrial
Sector is the largest energy consumer in Malaysia.
1.0%0.1%
18.9%
29.4%
50.6%
Chart 5: Sales of Electricity of TNB, SESB and SESCO According to
Sectors
Public Lighting
Mining
Domestic
Commercial
Industrial
Source: Energy Commission, Government of Malaysia (www.st.gov.my)
0.7%0.1%
83.3%
15.5%0.4%
Chart 6: Electricity Consumer of TNB, SESB and SESCO According to
Sectors
Public Lighting
Mining
Domestic
Commercial
Industrial
Source: Energy Commission, Government of Malaysia (www.st.gov.my)
3 Power sector consumes 30 % of primary energy supply
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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Subsequent benchmarking of industrial energy consumption against developing countries
(Figure 1), shows Malaysian industries’ energy efficiency and energy intensity can be
improved further.
0
50
100
150
200
250
300
350
400
450
1980 1985 1990 1995 1996 1997 1998 1999 2000toe/GDP Indu
strial 199
5 US Million
Year
Figure 1: Industrial Fuel Intensity in Selected ASEAN Countries 1980‐2000
Phillipines
Thailand
Malaysia
Vietnam
Indonesia
Source: MIEEIP, PTM
A further analysis on the available non‐renewable sources reveals a non‐pleasant scenario in
the coming decades, if Malaysia does not develop and implement succinct energy policies.
The oil reserves are expected to exhaust in 19 years [2] at the current rate of 0.73 million
bpd extraction. Conversely, natural gas reserve may indicate a more positive note, albeit still
will deplete in 33 years [2]. Coal reserves are in abundance, however the local coal
production is limited due to most reserves are in the interiors of the country and would
incur large cost for extraction [8].
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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4.0 ENERGY EFFICIENCY TECHNOLOGY (EET) IN MALAYSIAN INDUSTRY
The energy efficiency technology (EET) advancement in Malaysia has been enhanced and
strengthened with the establishment of Malaysia Industrial Energy Efficiency Improvement
Project (MIEEIP). The project is co‐funded by the Malaysian Government (under the Ministry
of Energy, Water and Communications, MEWC), United Nations Development Programme
and the Malaysian private sector, and is executed by the Malaysia Energy Centre (PTM). This
five‐year national initiative (1999‐2004) has been extended to June 2007 due to
overwhelming participation from the industry.
Based on energy audit activities carried out in eight energy intensive industrial sectors, it
was reported that potential energy savings would amount to 7.1PJA. This is realised with an
estimated capital expenditure of USD 26 million [9]. Apart from this, the Malaysian Energy
Efficiency Plan (EEP) foresees a potential energy saving of above 1400 GWh over the
equipment life‐time, equivalent to USD 62.6 million.
The type of energy efficiency technology applicable for the energy intensity enhancement of
an industry is very specific to that industry. The type of application in some of the industry
modelled by MIEEIP is shown in Table 4.
Table 4: Applicable Energy Efficient Technology for Malaysian Industry (MIEEIP Model)
No. Sector Energy Saving Application1 Cement High insulating bricks in rotary kiln burning zone; and/or
Rotary kiln combustion control and management system2 Ceramic Ceramic recuperator in sanitary ware muffle kiln3 Food Compact immersion tube juice pasteurisation; and/or
Mechanical vapour recompression evaporatorEnergy efficient food blanching through steam recirculation
4 Glass Electric heating or glass furnace forehearth; and/orExternal sprayed-applied insulating fibers for furnace refrigerator
5 Iron & Use of low excess air recuperative burners; and/orSteel Improved ladle drying and preheating in small foundaries
6 Pulp & Radio frequency dryingPaper Improved paper drying system
7 Rubber Drying air recirculation; and/orInsulation jackets for rubber injection press mold
8 Wood Flash steam and condensate recovery; and/orAutomatic solid fuel feeding and combustion systemWood dust burning system
Source: MIEEIP, PTM
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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The above table provides a small fraction of the technologies available in the market to be
utilised by the industry. There are number of Combined Heat and Power (CHP) efficient
technology being promoted in Malaysia to proliferate the efficient use of primary energy
such as natural gas [10]. The various EETs, but not exhaustive, have been listed in Appendix
1 for a quick perception of the progress of EET in Malaysia.
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5.0 CASE STUDY OF EET MODEL IN INDUSTRY
This part of the report attempts to provide a brief overview of some of the Energy Efficiency
Technology application being modelled by MIEEIP in the industry. Four case studies have
been reviewed in this section and the potential energy and cost savings, along with the
technology applied have been summarised in the following matrix.
Table 5: Energy Efficient Application in MIEEIP Industry Model (Case Studies)
Plant 1: Cargill Palm Products Sdn Bhd Plant 3: Pan-Century Edible OilsProduct: Refined palm oil Product: Refined Palm OilCapacity: 450 kMTA Capacity: 1000 kMTASub-sector: Food Sub-sector: FoodEnergy Efficient Application: Heat Recovery System Energy Efficient Application: Steam system optimization (using vacuum pump,
Process control of Stearin Hold-up Tank heating pressure regulating valves, etc.)Boiler fuel switching to Natural Gas High efficiency motorsOther maintenance activities (non-related) Cooling tower modifications for thermal efficiency
Total Energy Saving 24,522 GJ/annum Total Energy Saving 35,000 GJ/annumTotal Cost Saving USD 0.546 million/annum Total Cost Saving USD 0.285 million/annum
Plant 2: JG Container Sdn Bhd Plant 4: Malayawata Sdn BhdProduct: Glass container Product: SteelCapacity: 120 MTD Capacity: 700 kMTASub-sector Glass Sub-sector Iron & SteelEnergy Efficient Application: Replacement of 1970's with new glass furnace Energy Efficient Application: Two stage recuperator installation
Annealing lehrs replaced with energy efficient VSD for process cooling water pumpLPG/NG fired lehr Reheating furnace burner fuel atomisationRecycle of cullet washing water Fuel pre-hetaing using flue gas
Total Energy Saving 60,100 GJ/annum Total Energy Saving 19,724 GJ/annumWater Saving 8,250 m3/annum Fuel Saving 2,210 T/annumTotal Cost Saving USD 0.514 milliom/annum Total Cost Saving USD 0.572 million/annumSource: MIEEIP, PTM
The above case studies represent some of the typical energy inefficiencies in Malaysian
industry that has the potential for large degree of improvement. These plants are among 6.7
million (refer Chart 6) industrial energy consumers that potentially require some form of
energy efficiency tool to improve their energy intensity.
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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6.0 FUTURE ENERGY DEMAND: QUANTITATIVE ANALYSIS
In order to undertake the task of quantifying the impact of EET on future energy demand in
the industrial sector, plausible assumptions are essential due to the dynamics of economy,
social and political force that influence the energy demand in a country. The following are
the assumptions expressed in deriving the quantitative impact of EET:
• Although the economic growth and energy demand are linked, the strength of the
link varies among regions over time. Specifically, for the non‐OECD countries
(excluding non‐OECD Europe and Eurasia), energy demand and economic growth
have been closely correlated for much of the past two decades [5]
• The population projection [4] for Malaysia had been taken at 1.6 % per annum over
the period of analysis, which is from the year 2005 to 2020, hence the energy per
capita rises in tandem
• A linear correlation had been assumed between consumption per capita and time
function as indicated by the per capita against year plot
• Political influence had been thought to remain stable and current policies pertaining
to the use of fossil fuel and renewable will progressively improve
• Pareto principle of 80:20 is utilised to simplify the route of quantification, which
provides a rather low figure of energy saving, compared to actual potential
• MIEEIP energy audit data is considered as a random study of the Malaysian industry,
therefore enabling a secondary assumption that all other cases in the sector have
same level of improvement potential
• Alternatively, the Simple Ratio Method was used to provide a comparison study of
the potential energy saving affected by the use of EET. In this method, the following
secondary assumptions were made:
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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o Total energy consumed is directly proportional to inefficient use of energy
o Energy consumed includes both electrical and fuel energy
o All consumers have certain degree of inefficiency and as the number of
consumers increase, the cumulative effect of inefficiency becomes averaged
to the largest consumer’s inefficiency and therefore creates proportional
energy saving relative to the smallest consumer group energy saving
o Other demand factors (such as maintenance, turnaround activity etc) are
assumed constant and has insignificant cumulative effect.
The figures in Appendices 2 and 3 have been generated using some of the above
assumption. The curves obtained from the figures has regression (R square) factor between
0.98‐0.99, which indicates a strong linear relationship of the plots. The estimates of energy
demand for the year 2010 to 2020 has a marginal error of ± 5%, due to data disparity. Figure
4 in Appendix 3 provides a comparison on the impact of EET when implemented in the
industry, with the assumption that the implementation has been carried out earlier than
2010 to produce the effect.
The first curve shows the possible energy demand being 1138 PJA in 2020, without the EET
impact. However, a reduction of 5 % energy demand is observed in the second curve (1081
PJA). This reduction is observed for an energy saving of 57.3 PJA vis‐a‐vis EET application,
and as calculated based on Pareto rule (Appendix 4). The third curve shows a reduction of 5
% in energy demand, using a value of 59.6 PJA as energy saving [9], which was obtained
from a literature by Malaysia Energy Centre (PTM). Alternatively, via the Simple Ratio
method, the fourth curve shows a reduction of 109PJA, which is about 9.6 % of energy
demand.
Although the estimated values’ error margin and impact order is in the same magnitude, the
overall figure indicates a potential gain in energy utilisation with the application of EET.
However, the error margin could be reduced with better set of data over a longer period of
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
18 | P a g e
analysis and a comprehensive industrial energy consumption data, which is lacking in this
analysis.
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7.0 CONCLUSION
A progressive nation such as Malaysia stands to gain more with better technologies. At
present, Malaysia is a net exporter of energy, however, this advantage may not remain in
decades to come, as its natural resources deplete. On a more positive note, Malaysia is
evolving its energy policies effectively, albeit a little slower than many developing countries
such as China and India. Subsequently, an effective implementation of the energy efficient
policies and technologies will be the ultimate outcome anticipated to ensure future energy
use optimisation.
This report has shown the progressive policy development, the industrial energy demand
and several case studies of Energy Efficiency Technology implementation in Malaysia. The
attempt to quantify the impact of EET in the future energy demand for industry has been
made with reasonable assumptions and limited available data. The impact of EET is seen to
be assisting the country between five to ten percent of energy reduction between 2010 and
2020. This impact could be lesser or more, depending on the extent of EET implementation.
The effective implementation of EET in five to ten years from now will depend on how the
policies are regulated, how the consumers’ awareness of economic loss (in the absence of
EET) is projected and the consumers’ capacity to embrace higher energy efficiency
technologies.
Although the analysis indicates lower energy consumption in the industry as an impact of
EET implementation, this may not be the ultimate solution for future energy demand as the
burgeoning economy and population will subsequently drive for higher energy requirement.
A multifaceted synergized approach for technology and renewable energy development
would probably be a more pragmatic solution.
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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REFERENCES
[1] International Energy Agency (IEA), www.iea.org. Energy Technology Essentials (2007).
[2] United Nations Development Programme (UNDP), www.undp.org.my. Achieving Industry Energy Efficiency in Malaysia(2006).
[3] Economic Planning Unit (EPU), www.epu.gov.my. The Ninth Malaysia Plan (RMK9), 2006.
[4] The Star Online, www.thestar.com.my. Malaysia Ninth Plan, March 31, 2006.
[5] Energy Information Administration, www.eia.doe.gov/oiaf/ieo.world.html World Energy and Economic Outlook, International Energy Outlook 2006; Report No.:DOE/EIA‐0484(2006).
[6] Economic Planning Unit (EPU), www.epu.gov.my. The Seventh Malaysia Plan (RMK7), 1996.
[7] A. Rahman Mohamed, K.T. Lee. Energy for sustainable development in Malaysia: Energy policy and alternative energy. Energy Policy (2006); 34(15): 2388–2397
[8] Economic Planning Unit (EPU), www.epu.gov.my. The Eighth Malaysia Plan (RMK8), 2001.
[9] R. Ponnudorai. Concept Paper on EE Business Opportunity in Malaysia (2005); PTM, www.ptm.org.my
[10] Phang AC. Potential of Gas Fired CHP in the Manufacturing Sector in Malaysia, Malaysian‐Danish Environmental Cooperation Programme (2005).
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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Appendix 1: Examples of Energy Efficiency Technology
Table 6
: Pote
ntial En
ergy an
d Cost
Saving
Identif
ied from
the Fac
tories A
udited
Under
the MIE
EIP, Ma
laysia 2
004
Sectors
Food
Wood
Cerami
cCem
entGla
ssRub
berPul
p &
Iron &
Total
Paper
Steel
Annual
Energy
Consum
ption (G
J/annum
)1,83
5,430
1,03
1,528
774
,061
21,5
56,595
4,00
0,370
611
,307
5,08
0,208
4,22
3,247
39,1
12,746
Annual
Energy
Cost ('0
00 USD1 /ann
um)12,0
67
3,861
6,875
58,3
28
27,9
51
4,831
24,0
57
45,752
183
,721
Tot
al Ener
gy Savin
gs (Tot
al GJ/an
num)
373,587
360
,561
155,356
345,508
104,095
162
,472
811
,547
270,053
2,58
3,179
Tot
al Cost
Saving
('000 U
SD1 /annum)
2,433
1,486
1,712
9,64
3
710
1,232
5,64
8
1,49
9
24,3
63
Sou
rce of D
ata: PT
M Findi
ngs of t
he Ener
gy Audit
s1 1U
SD = R
M 3.5
Tabl
e 7:
Lis
t of E
E Pr
ojec
t for
Sec
ond
Phas
e of
MIE
EIP'
s De
mon
stra
tion
Proj
ect
Proj
ect
Sect
orEn
ergy
GJ
Ener
gy C
ost U
SDBo
iler e
cono
mis
er &
was
te h
eat r
ecov
ery
Food
167,
087
620,
000
El
ectr
ode
Reg
ulat
ing
Syst
em fo
r EAF
Iron
& St
eel
26,2
223,
123,
429
Ener
gy L
eaka
ge R
educ
tion
Cem
ent
9,18
025
7,14
3
Gob
mon
itorin
g &
fuel
sub
stitu
tion
Gla
ss1,
780
400,
571
Im
prov
e in
frac
tiona
tion
plan
t coo
ling
Food
1,90
011
1,42
9
Stea
m a
bsor
ptio
n ch
iller
Pulp
& P
aper
13,1
1621
3,14
3
Dies
el g
ener
ator
flue
gas
dry
ing
Woo
d39
,955
284,
571
Lo
w th
erm
al k
ilnCe
ram
ic16
,107
137,
143
To
tal
275,
347
5,14
7,42
9
So
urce
: Ref
eren
ce (8
)
Ener
gy S
avin
g (a
nnua
l)
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
22 | P a g e
Appendix 2: Energy Demand Curve Estimates without EET Impact
y = 31.72x ‐ 62936R² = 0.984
y = 80.66x ‐ 160013R² = 0.985
y = 2.222x ‐ 4390.R² = 0.990
0
10
20
30
40
50
60
70
80
90
0
500
1000
1500
2000
2500
1985 1990 1995 2000 2005 2010 2015
Energy, PJ
Year
Figure 2: Energy Demand Curve (without EET) from 1990 to 2010
Industry Energy Demand, PJ Energy Demand, PJ GJ/Capita
GJ
0
20
40
60
80
100
120
0
500
1000
1500
2000
2500
3000
3500
1985 1990 1995 2000 2005 2010 2015 2020 2025
Energy, PJ
Year
Figure 3: Energy Demand Estimates (without EET ) from 2010 to 2020
Industry Energy Demand, PJ Energy Demand, PJ GJ/Capita
GJ
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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Appendix 3: Energy Demand Curve Estimates with EET Impact
190
290
390
490
590
690
790
890
990
1090
1985
1990
1995
2000
2005
2010
2015
2020
2025
Energy, PJ
Year
Figure 4: Ene
rgy Dem
and Estim
ates with
EET
Impa
ct from
2010 to 2020
EE3 Impact on Indu
stry (SR)
EE2 Impact on Indu
stry (Re
f)EE1 Impact on Indu
stry (PA
)Indu
stry Ene
rgy Dem
and, PJ
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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Appendix 4: Energy Savings and Quantitative Analysis Calculations
Table 6: Potential Energy and Cost Saving Identified from the Factories Audited Under the MIEEIP, Malaysia 2004
Sectors Food Wood Ceramic Cement Glass Rubber Pulp & Iron & TotalPaper Steel
Annual Energy Consumption (GJ/annum) 1,835,430 1,031,528 774,061 21,556,595 4,000,370 611,307 5,080,208 4,223,247 39,112,746 Annual Energy Cost ('000 USD1/annum) 12,067 3,861 6,875 58,328 27,951 4,831 24,057 45,752 183,721 Total Energy Savings (Total GJ/annum) 373,587 360,561 155,356 345,508 104,095 162,472 811,547 270,053 2,583,179 Total Cost Saving ('000 USD1/annum) 2,433 1,486 1,712 9,643 710 1,232 5,648 1,499 24,363 Source of Data: PTM Findings of the Energy Audits1 1USD = RM 3.5
Using Pareto Analysis1 Total Consumer of Energy in Industry (Electrical Cons.) 33740
Pareto Rule: 80% of inefficient use of energy in industry is caused by 20% of the energy consumer
Number of consumers audited 432 Energy saving reported in the Audit (for electricity) 0.365 PJAPercentage of this consumer 0.127 %Saving from 20% of the Industry 57.28 PJA Electricity
Simple Ratio MethodTotal Energy Consumed by 43 Consumers 39.11 PJATotal Energy Demand by Industry 630 PJA2 Energy Saving reported in the Audit (Total) 6.824 PJATotal potential saving 109.92 PJA
PJA - Peta Joule per Annum2 Based on reference (8)1 0.5 % of Electricity Consumer - Refer Chart 5 & 6
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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Appendix 5: Energy Generation Mix and Power Producers’ Capacity
18.4%
2.5%
0.3%
7.5%
1.9%
0.7%
58.4%
10.3%
Chart 1: Generation Plan Mix
Coal
Oil
Distillate
Diesel
Biomass
Hydro
Gas
Others
Source: Energy Commission, Government of Malaysia (www.st.gov.my)
27.3%
2.3%
2.6%
55.2%
1.5%1.5%
3.5%0.5% 5.6%
Chart 2: Generation Capacity of Major Power Producers
TNB
SESB
SESCO
IPP (Peninsular Malaysia)
IPP (Sabah)
IPP (Sarawak)
Co‐Gen (Peninsular Malaysia)
Co‐Gen (Sabah)
Private Generation
Source: Energy Commission, Government of Malaysia (www.st.gov.my)
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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Appendix 6: Generation Mix and Power Producers’ Generation
23.5%
66.6%
0.1%2.8%
0.6%5.8%0.6%
Chart 3: Generation Mix in Malaysia
Coal
Gas
Distillate
Diesel
Biomass
Hydro
Others
27.9%
1.5%
2.1%
59.8%
1.9%1.9%
3.4%0.4%
1.1%
Chart 4: Generation by Major Power Producers in Malaysia
TNB
SESB
SESCO
IPP (Peninsular Malaysia)
IPP (Sabah)
IPP (Sarawak)
Co‐Gen (Peninsular Malaysia)
Co‐Gen (Sabah)
Private Generation
Source: Energy Commission, Government of Malaysia (www.st.gov.my)
ENERGY EFFICIENCY TECHNOLOGY IN MALAYSIA: THE IMPACT ON FUTURE ENERGY DEMAND IN THE INDUSTRIAL SECTOR
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Appendix 7: Sales of Electricity and Consumers
1.0%0.1%
18.9%
29.4%
50.6%
Chart 5: Sales of Electricity of TNB, SESB and SESCO According to
Sectors
Public Lighting
Mining
Domestic
Commercial
Industrial
Source: Energy Commission, Government of Malaysia (www.st.gov.my)
0.7%0.1%
83.3%
15.5%0.4%
Chart 6: Electricity Consumer of TNB, SESB and SESCO According to
Sectors
Public Lighting
Mining
Domestic
Commercial
Industrial
Source: Energy Commission, Government of Malaysia (www.st.gov.my)