Optimization of Malaysia’s power generation mix to meet the electricity demand by 2050

Abstract

The Malaysian Government has been introducing fuel diversification policies over the past decade by considering other sources of fuel such as alternative and renewables into the electricity mix as a measure to lengthen the oil and gas reserves against premature depletion. Since electricity consumption forms about a fifth of the total energy consumption, and directly impacts the country’s economy and people’s well-being, it is necessary to pay emphasis on Malaysia’s long-term power sector planning by identifying sustainable options which will enhance Malaysia’s energy security and mitigate climate change. This paper presents an analysis of the long-term power generation options for Malaysia by deploying the integrated MARKAL-EFOM system (TIMES) model. The examined scenarios are business as usual (BAU) and optimized least cost scenarios which include: existing technology, plus renewable, plus nuclear as well as, plus photovoltaic (PV) and storage. The results indicated that Malaysia has sufficient renewable energy resources to meet the projected electricity demand by 2050 and fossil fuels can be fully replaced with electricity sourced from large hydropower and combination of other indigenous sustainable energy sources. The variability issue of renewables can be stabilized with the integration of storage systems into the grid. This analysis also demonstrated that installation of 8.57 GW solar PV panels on existing rooftops combined with 3.6 GW large-scale pumped heat energy storage (PHES) system can generate electricity comparable to a 2.0 GW nuclear plant at a lower system cost of $102.4 billion. Hence, if Malaysia were to adopt a sustainable policy, then nuclear power would not be an ideal option as uranium fuel relies on continuous imports.