Ensuring an Inclusive and Just Green Transition for Malaysia

20 October 2023

As more multinational corporations and investors shift away from traditional carbon-heavy industries towards embracing the green economy, much of the focus has been on the benefits of this transition on organisations’ bottom lines, a country or region’s natural resources. However, less is said of how the decarbonisation transition can adversely affect SMEs, workers, communities, and countries that have depended on carbon-intensive activities for their livelihoods and economies.

This is where the concept of Just Transitions steps in. As defined by the Institute for Human Rights and Business, Just Transition encompass the transition away from high-carbon activities and practices towards a more sustainable green economy. Its primary objective is to mitigate harm to workers, local communities, countries, and regions all while maximising the benefits of climate action. The concept puts a heavy emphasis on the social aspects of the green transition, particularly in relations to workers’ rights. Globally, just transition was affirmed in the 2015 Paris Agreement (COP 21) and gained significant momentum at the 2021 UN Climate Conference in Glasgow (COP 26).
Launched in July 2023, the National Energy Transition Roadmap (NETR) codifies just transition into Malaysia’s journey from a traditional fossil fuels-based economy to a high-value green economy. The NETR is supported by six pillars: energy efficiency (EE), renewable energy (RE), hydrogen, bioenergy, green mobility, and carbon capture, utilisation and storage (CCUS).

In tandem with this, 10 flagship projects are expected to attract investments of more than RM25 billion, create 23,000 job opportunities and reduce greenhouse gas (GHG) emissions by more than 10,000 gigagrams of carbon dioxide equivalent (Gg CO2eq) per year. These green job opportunities will require requisite reskilling and upskilling to reduce financial impacts on Malaysian workers and drive social inclusivity in the green transition process.

Reskilling and upskilling for green jobs

An equitable and just energy transition create a workforce that is prepared for the green future while upholding social inclusivity. As such, just transitions were codified into the NETR.

Investments include human capital initiatives necessary to drive upskilling, reskilling and community support measures, to ensure minimal harm to communities, SMEs, and worker groups that are financially-reliant on carbon-intensive industries.

These human capital investments include:

Source: NETR

Pillar 1: Energy Efficiency (EE)

EE offers effective long-term solutions to lower energy intensity and reduce CO2 emissions. It meaningfully improves all dimensions of the energy trilemma, by reducing demand to improve energy security, lowering costs for users to enhance energy equity and minimising emissions from energy production to elevate environment sustainability. By 2040, the NETR aims to achieve energy savings of 21% compared to the business-as-usual scenario, with residential areas realising 15% savings and industrial and commercial areas realising 22% savings.

Sarawak’s Green Data Centres

Image from Solarquarter
In September 2023, local clean energy firm Solarvest signed an MoU with Centre for Technology Excellence Sarawak (CENTEXS), Huawei Malaysia, and GreenBay CES to launch a hyperscale green data centre testbed and training programme in Sarawak.

Solarvest Borneo will contribute its expertise in green energy and energy efficiency solutions, CENTEXS will provide a dedicated testbed area for practical data centre operations training, while Huawei Malaysia will leverage on its technological knowhow in cloud computing, enterprise intelligence, renewable energy and data centres to support the training needs of the programme. Complementing these efforts, GreenBay will lend its expertise in constructing future-proofed data centres in a cost-efficient manner.

Pillar 2: Renewable Energy (RE)

Investments of at least RM1.2 trillion are needed between 2023 and 2050 to enable a responsible energy transition. Of this amount, more than half (RM637 billion) will be ploughed into RE in line with the Government’s commitment to accelerate RE deployment in Malaysia’s power sector to 70% or 55 gigawatts (GW) by 2050 from 25% or 10GW today.

Solar Powers Remote Villages

Image from Evwind 

For instance, the state of Sarawak in Borneo sees most of its residents employed in the lucrative O&G sector, with oil rigs located in the South China Sea. At the same time, solar power is common in remote hinterland villages due to a lack of accessibility and infrastructure. Ecogreen, one of several companies developing solar plants under the Sarawak Alternative Rural Electrification Scheme, involves local communities and youth as technicians. Local workers undergo formal training and are certified in solar system certification while learning about battery technology on the job.

Pillar 3: Green Mobility

By 2050, the NETR aims to elevate the public transport modal share to reach 60%, accelerate the penetration of x electric vehicle (EV) EV (4W) share of the vehicle fleet to 80%, accelerate the penetration of electric two-wheelers’ (E2W) share of the vehicle fleet to 80%, foster robust local EV manufacturing capabilities to achieve 90% local xEV manufacturing, and continue improvements in the internal combustion engines (ICE) fuel economy. To ensure a just transition in the mobility space, Malaysia’s vehicle manufacturers have taken a proactive approach to upskilling their staff for the EV evolution, after decades of ICE.

Reskilling Proton for NEVs

In December 2022, national automotive brand Proton sent 16 staff members to Hangzhou, China to learn about new energy vehicles (NEV). The six-month programme will see them based at the Geely Research Institute at Ningbo and be trained in multiple disciplines involved in the development, integration, manufacturing, and sales and service for a new generation of vehicles that will gradually be introduced by Proton.

Upskilling Sime Darby Motors’s EV Technicians

Image from Paultan.org

In March 2022, Sime Darby Motors (SDM) teamed up with TOC Automotive College to establish programmes to upskill EV technicians servicing the brands under the group. Training by TOC will supplement EV service and maintenance training received from SDM’s brand principals such as BMW/MINI, Ford, Hyundai, Jaguar Land Rover and Volvo. Key modules include the principles and concepts behind electrification and hybridisation, safety and systems operations, as well as practical activities such as diagnostics, testing and repair works.

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