Malaysia has established its own energy exchange, Energy Exchange Malaysia (Enegem), to facilitate cross-border trading of green electricity. The initiative kicks off with a pilot auction aiming to export 100 megawatts (MW) to Singapore, leveraging existing infrastructure.
The pilot auction is exclusively accessible to entities holding an electricity generation and/or retailer license for the Singapore Electricity Market, as stated by the Ministry of Energy Transition and Water Transformation (Petra) on Monday.
Interested parties must register with the single buyer to participate in the auction. Successful bidders will then proceed with the purchase of green electricity through the auction.
Winning bidders will engage in a renewable energy (RE) supply agreement with the single buyer for the sales and purchase of the green electricity.
Trading activities via Enegem will adhere to the latest Guide for Cross-Border Electricity Sales (CBES) issued by the Energy Commission. Parties keen on the auction can register their intent to participate via Petra or the single buyer’s website starting Tuesday.
Petra extends an invitation to eligible parties to participate in the inaugural auction for the purchase of green electricity from Malaysia’s electricity supply system, destined for Singapore via the Enegem platform.
The ministry believes that initiating auctions via the Enegem platform will bolster Malaysia’s cross-border electricity integration framework and foster greater RE development and regional cooperation among ASEAN countries.
Last year, Malaysia lifted its RE export ban and announced the conduct of cross-border RE sales via the Enegem platform. Additionally, plans were disclosed to establish an independent single buyer, separate from Tenaga Nasional Bhd (TNB), to manage Enegem.
Currently under TNB, the single buyer determines electricity procurement from power plants, consolidating the entire electricity supply to meet demand.
Petra recently opened bidding for the fifth large-scale solar (LSS) quota awards totaling 2GW. However, no new solar or conventional power plant projects have been announced to specifically cater to energy exports to Singapore, which has expressed interest in importing up to 1.2GW of electricity by 2027.
Malaysia’s existing RE supply caters to programs like the Green Electricity Tariff (GET) program, enabling TNB customers to access green electricity from renewable sources to reduce their carbon footprint.
Petra introduced a new tiered pricing mechanism for GET last week, with a quota of 6,600 gigawatt-hour (GWh) for 2024. Rates were set at 10 sen per kilowatt-hour (kWh) for domestic and non-domestic low-voltage users, and 20 sen/kWh for non-domestic medium and high-voltage users, compared to 2023’s blanket GET rate of 21.8 sen/kWh.
This is a big move for Malaysia in the green energy game! Setting up an energy exchange and getting into cross-border trading with Singapore is a smart move. Hopefully, it leads to more sustainable energy solutions and strengthens regional cooperation in ASEAN.