Professional Documents
Culture Documents
Energy Malaysia Volume 6 PDF
Energy Malaysia Volume 6 PDF
Volume 6 2015
www.st.gov.my
Volume 6
KDN: PP 18540/08/2014(033966)
24 INTELLIGENT NETWORKS
A look at how smart grids can help enhance the
generation, transmission and distribution of electricity,
leading to better managed systems and cost
reductions, as well as at the efforts to roll them
out in Malaysia.
Editorial Board
Advisor
Datuk Ir Ahmad Fauzi Hasan
Members
Ir Azhar Omar
Ir Othman Omar
Asma Aini Mohd Nadzri
Ir Abdul Rahim Ibrahim
Mohd Elmi Anas
Ir Roslee Esman
Editorial Committee
Siti Suhaila Ahmad
Noor Haniza Noordin
Maimunah Zubir
On-Site
Conceptualised, Produced and Published for
45 Highlights of events, forums, seminars,
conferences and exhibitions organised or attended SURUHANJAYA TENAGA (ENERGY COMMISSION)
by the Energy Commission.
by
Printed by
Percetakan Skyline Sdn. Bhd.
(135134-V)
Strengthening
the Grid
Over the last two decades, Malaysia has experienced
a substantial increase in energy consumption, with
electricity demand per person rising from 1,460kWh
in 1993 to 4,110kWh in 2013. Rapid economic
growth leading to an increase in industrial output and
demand for electricity contributed to this.
We are determined that electricity supply in the These are some of the key initiatives towards a
country will be maintained at an optimum level. more efficient grid which will enable us to meet
Therefore, the Energy Commission is constantly the demands of the future. Malaysia aims to move
working with other stakeholders to continually forward rapidly, and the Energy Commission is
strengthen the National Grid by making sure that determined that there is sufficient power to fuel this
there is enough generation capacity, and upgrading national ambition.
the delivery system to cater for projected normal
operations as well as foreseeable abnormalities.
To illustrate, we have approved the construction of Dato’ Abdul Razak Abdul Majid
two new 500kV transmission lines. One of these will Energy Commission of Malaysia
2
News
Self-Generating Power
with NEM
Solar power users can now generate and use their own their own consumption, using renewable sources, which is
electricity, as well as sell the excess to Tenaga Nasional also a plus for the environment.
Berhad (TNB) with the new implementation of net energy
metering (NEM). This is a type of distributed generation According to Sustainable Energy Development Authority
allowing consumers to outweigh the cost of their electric Malaysia (SEDA) COO Datuk Dr Ali Askar Sher
usage with energy they export to the grid, with an eligible Mohammad, the suggested NEM quota is currently being
power generator, in this case, solar panels. looked into and will be reviewed in the medium term,
should there be an increase in consumer demand.
With the approval of the NEM implementation by
the Ministry of Energy, Green Technology and Water
(KeTTHA), everyone will be able to generate electricity for
3
News
Incentive-
Based
Regulation for
Gas Sector
The implementation of the
incentive-based regulation
(IBR) framework on the
gas sector is expected to
encourage greater efficiency.
The natural gas sector in Malaysia will undergo a change Enforced by the Energy Commission, IBR in the gas sector will
on 1 January 2016 when the Government introduces have a trial run of one year, followed by the first regulatory
the incentive-based regulation (IBR) framework. The main period from 2017 to 2019. In a statement to the media, Gas
supplier of piped gas in Peninsular Malaysia, Gas Malaysia Malaysia said, “In support of the liberalisation of the natural gas
Bhd, will be subjected to the IBR, which aims to incentivise industry, which is to gradually align current piped gas towards
better operational performance through efficient allocation market prices, IBR is introduced to promote efficient resources
and use of resources. allocation and usage, and sustainable financial performance.”
4
Feature
Planning to Grow
Maximising National Development
with Energy Efficiency
A rapidly developing country, Malaysia’s
economic growth and advancement is highly
dependent on the cumulative efforts of all its
sectors—from manufacturing and transportation
to logistics and construction. As its population
grows, development ramps up and the economy
progresses further, the toll will be on the demand
and consumption of more energy to boost
production, and the environment, which will
suffer the effects of pollution and degradation.
This is where the efficient use of energy comes
in—the aim is to apply less power to accomplish
the same level of tasks, or grow the economy
without increasing carbon emissions.
5
five initiatives (such as energy efficient development of the nation, there are widespread adoption, and lack of
building designs, rating and labelling a number of challenges that need to dedicated financial support—in terms
of appliances, and setting a Minimum be overcome to achieve these results. of loans and monetary packages for
Energy Performance Standard). These include the low price of energy EE projects and appliances. The lack
in the country owing to subsidies, and of consistency in the implementation
According to the NEEAP Draft Final currently further enhanced by the global of EE strategies is also the operational
Report published last year, the plan is decline in oil prices. This translates to barrier that was identified and is to
expected to reduce CO2 emissions taking electricity for granted leading to be resolved by the NEEAP.
by 40 million tonnes over 10 years higher consumption. A solution is the
and about 90 million tonnes of CO2 gradual removal of energy subsidies— ADVANCEMENT STRATEGIES
equivalent over the lifetime of energy forcing consumers to pay more attention
efficient equipment purchased as part to their power use. Unlike a number of ASEAN countries
of the initiative. (such as Thailand, Singapore and
According to the NEEAP report, Vietnam) that have already advanced
BREAKING BARRIERS other issues that affect the adoption the implementation of their national
of EE strategies in the country are the EE strategies, Malaysia’s NEEAP is
While the impact of EE strategies absence of a national plan or guideline still relatively new. Nevertheless, it
through the NEEAP is beneficial to the to implement EE and achieving has good basic guiding principles
6.0
5.0
4.0
GWh
3.0
2.0
1.0
0.0
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
% of Demand Reduction
Over a 10-year period, the National
Energy Efficiency Action Plan (NEEAP)
is expected to reduce electricity
consumption by 6% across residential,
commercial and industrial users. Source: Energy Commission
6
Feature
Reduce
Energy Bill
Reduce
Environmental Improve
Effects Quality
of Life
Commercial
Energy efficient buildings Residential
Energy efficient appliances
The overall aims of the
NEEAP include encouraging
subtainable consumption of
electricity, which will result
in enhanced economic
productivity as energy-
efficiency solution enable
greater output with lesser input.
More than just encouraging users to reduce their demand for electricity,
NEEAP and EE strategies aim to decrease Malaysia’s carbon footprint,
lessen its dependence on imported fossil fuels and the long-term cost of
importing oil and gas. Adopting energy efficiency is also beneficial for
consumers, who will be able to save on their monthly costs, as well as
minimise the impact of economic development on the environment.
7
Allowing Access
New Policy to Enhance Malaysia’s Gas Industry
In the decade between 2003 and 2013, piped natural gas consumption in the
country increased by 44.3%, from 6,981ktoe to 10,076ktoe. As demand grows
amid limited and declining supply, there is an urgent need to utilise available power
as efficiently as possible while ensuring a sustainable and reliable supply, as well as
energy security. One of the measures the authorities in Malaysia is taking to ensure
the continued availability of natural gas in the country—and continued national
development—is the liberalisation of the gas market.
The liberalisation of the industry system was Petronas. Speaking to “Although gas prices are currently
through the Third-Party Access (TPA) Energy Malaysia, Ir. Roslee regulated and subsidised by the
aims to enhance the existing Gas Esman, Director of the Energy government, such subsidies may
Supply Act (GSA) 1993, which Commission’s Gas Development be removed in future to make gas
outlines the supply and distribution and Regulation Department, impor ts economically feasible.
of gas at competitive prices in the notes that the proposed liberalisation This will translate to higher costs for
country. Prior to the proposed opening of the industry will be beneficial to the consumers and the industry if
of the market, the sole importer of the sector’s stakeholders, consumers measures are not taken ahead of
gas into Peninsular Malaysia via and the continued development of time,” Ir. Roslee explains.
the Peninsular Gas Utilisation (PGU) the country.
He adds, “What the liberalisation of
the market does is open the industry up
for other players who are interested in
importing gas using the regasification
terminal or Peninsular Gas Utilisation
(PGU) pipeline. With Petronas as the
only player in the industry, pricing may
not be as competitive for stakeholders,
who adhere to a Petronas-set price.
The idea behind the liberalisation is
that with more players involved in gas
importation, consumers will also be able
to enjoy lower and competitive tariffs.”
8
Feature
Sales and
Purchase Agreement Gas Sales
SHIPPERS Agreement
Owner of the Gas
Re-gas Service
Agreement
Transportation
Agreement
Regasification (RGT)
Terminal
Transporter
Offtakers/
end-users
Conne
cti
Agree on Conne
ment cti
Liquefied Agree on
Natural Gas ment
(LNG) • Inter-shipper
Traders/ Agreement Petronas Gas Berhad
Producers (PGB) Network Code
The TPA will open the Malaysian gas Physical connection/gas flow
market, making it more competitive Commercial arrangement
as more players get involved in the
importation and distribution of the
commodity. Source: Petronas 2014
9
Feature
ATTRACTING COMPETITION
Market on the 23rd of April 2015, at global industry prices, to secure
Stipulated under the fifth entry point Dato’ Abdul Razak Abdul Majid domestic availability and in anticipation
project of the Economic Transformation noted, “While the codes elaborate of future increases in demand.
Programme’s (ETP) Oil, Gas and on agreements and ser vices, a
Energy sector, the proposed TPA will be Competition Guideline for the RENT TO USE
regulated by the Energy Commission, Malaysian Gas Market encourages
and will require licenses encompassing a conducive, transparent and fair The big picture here is that liberalising
import into regasification terminals gas industry environment. It does the gas industry will create benefits
(RGT), regasification, shipping and this by creating a level playing field for the country that are more than
transportation, and distribution and without discrimination among the domestic. For one, the TPA will allow
retail. The Energy Commission will users of the facilities by the suppliers. local and foreign companies compete
also oversee the Gas Code, which In addition to that, the Guidelines also on a level playing field in the country
is a set of three TPA codes (for the prevent anti-competitive behaviour with the commodity sold and shipped
Malaysian Regasification, Transmission and abuse of dominant position.” at global market prices.
and Distribution system infrastructure)
expected to be ready for implementation In essence, the TPA takes advantage Ir. Roslee also notes, “Only the
after Gas Supply Act (amendment) of the completion of the Petronas LNG tariff for use of infrastructure such as:
approved by the Parliament. Regasification Terminal in Sungai RGT, transmission and distribution, will
Udang (RGTSU) in 2013 to encourage be regulated. Other than that, the
Speaking at a workshop for the petroleum companies to commence gas price will depend on the market
Liberalisation of the Malaysian Gas supplying gas to the Malaysian market supply-demand.”
Expected to be tabled in Parliament later this year, the TPA has undergone
a process of discussions and consultations with stakeholders in the gas
industry to receive and incorporate feedback into the amendment since it
was proposed two years ago. As subsidies and domestic gas sources fade,
liberalising the Malaysian gas industry promises to boost the availability of
the commodity at attractive and competitive prices.
10
Safe And Efficient
Usage Of Electricity
Test the automatic circuit breaker switch in your home today!
Automatic circuit breaker switches found in the button is pressed and you can restore the switch to its
electrical distribution board in your home is to protect original position.
you and your family from the dangers of electric shock.
If the automatic circuit breaker switch does not trip after
Ensure that the automatic circuit breaker sensitivity the test button is pressed, you should immediately consult
does not exceed 100 mA or 0.1 A and is tested at least a Registered Electrical Contractor for inspection and
once a month to ensure that it always functions replacement of the automatic circuit breaker switch.
satisfactorily.
If you are using an electric water heater in the bathroom,
A simple way to test the automatic circuit breaker is to make sure that the automatic circuit breaker switch with a
press the test button (marked ‘T’). Automatic circuit sensitivity of not exceeding 10 mA or 0.01 A is installed
breaker switch that works well will trip when the test in the water heater circuit.
12
Feature
13
capacity of 1,480 tonnes per hour. plants for their use, as well as to supply
The electricity and heat will be used the national grid.
to power the Pengerang Integrated
Complex (PIC). The PIC is the “Examples of CHP plants in Malaysia
largest Refinery and Petrochemicals include the Pengerang Cogeneration
Integrated Development (RAPID) Plant and Centralised Utility Facilities
project in Malaysia, and will comprise (CUF) in Kerteh, Terengganu and in
petroleum cracking facilities, oil Gebeng, Pahang,” Rizal reveals.
refineries, petrochemical plants, However, he explains that currently,
as well as liquefied natural gas the demand for cogeneration plants
(LNG) import terminal, power and is driven by specific industries, and
regasification plants. It is also part of not as high as it should be. “While
the larger, 20,000-acre Pengerang many industries require electricity
Integrated Petroleum Complex (PIPC) and steam, many businesses are
in Johor. yet to understand the competitive
advantage they can have from using
COMPETITIVE ADVANTAGE CHP,” he said.
Electricity 38%
14
Feature
Nurhafiza explains. For industrial and natural gas. Still, Rizal points out that notes that another advantage of CHP
commercial users, CHP offers additional the predominant use of natural gas plants is that licensees do not have
competitiveness with significant cost for fuel generation may be beneficial to follow any special procedure, as
savings and increased employment. For for the gas industry, as it will see “the process is exactly the same as
instance, the PIPC is expected to require the commodity become more widely conventional generators—with a 60-
up to 2,000 workers from various used in the country, and reduce day processing period.” However,
industries and with different skill sets. the importation of coal for power the Energy Commission considers
generation. It is important to note cogeneration plant applications
In many scenarios, CHP offers that Malaysia is currently the world’s more stringently, as “we don’t want
domestic energy supply security, as second largest producer of natural industries to develop CHP plants just
well as the opportunity to increase gas after Qatar. to sell to the grid.” Rather, the plants
the diversity of generation plants. need to have been created for private
This however may not be the case Concurring, Nurhafiza added that use and the excess waste heat and
in Malaysia, where the primary fuel in some Malaysian states, biomass steam should be what the operators
source for cogeneration plants is is also used as a fuel source. She want to distribute to other users.
In terms of national energy mix, Rizal explains that core areas of consideration
are the security of supply, cost and the environment, “and cogeneration fits into
these categories with cost advantage, supply security and lower CO2 emissions.”
He adds, “This is one of the reasons why the PIPC project is significant. In
addition to the power the complex generates and consumes, it will also sell
electricity to the national grid at competitive rates.”
15
The Code
Confused by the numerous terms from The Malaysian Grid Code?
Energy Malaysia presents some of the commonly used terminologies,
based on the Glossary and Definitions section of the Code.
16
Tips
TRANSMISSION
17
The National Grid
A Framework for Advancement
18
Feature
19
Feature
Developing Distribution
5 Benefits of Grid
& Distribution
Codes
1 Encourages healthy
competition in the electrical
Inspectorate for Sarawak. Concurrently, the MDC was created supply industry (ESI)
because there were no regulations
First introduced in 1994, more than to guide the parties involved at the 2 Promotes enhanced
four decades after the establishment of distribution level of electricity supply development, maintenance
the Peninsular Grid System, the MGC at that time. In addition, the MDC
was later revamped and the MDC provided guidelines on the relationship
and operations of the
officially created in 2010, and both between the Distributors, the Energy country’s grid network
effected on 1st January 2011. The Commission and users of the electricity
overhaul of the MGC aimed to update distribution network. 3 Furthers the interest
the previous standards to be in line of consumers
with the current state of the electricity To ensure that the opinions of all parties
supply industry (ESI), separate the roles involved in the ESI are considered, 4 Helps ensure uniform
high quality of electricity
generation and supply
PARTIES IN THE NEW CODES 5 Facilitates systematic and
The revamped Malaysian
operational planning for the
Interconnected Party Grid Code 2010 sees development of the ESI
Party outside the the Energy Commission
overseeing the operators
country connected at
and processes in the
Entire Grid transmission voltage electricity grid in the
System Operator peninsula.
Operates the Peninsular a Grid Code Committee and a
Malaysia Grid System Distribution Code Committee were
Generators constituted. The former comprises the
TNB and IPPs Energy Commission as its Chairman,
with 9 representatives from TNB, 6
Directly Connected
Network Operator from IPPs, 1 from a Network Operator,
Customers Operates network at any voltage
Connected and metered at 2 from the Energy Commission and
and may import/export to grid 1 independent technical expert.
transmission voltage
TNB Transmission
Grid Owner On the Distribution side, the Energy
Distributors Develops, owns, operates and maintains Commission also sits as its Chair,
Connected to grid, operate only the high voltage transmission assets with 5 delegates from TNB, 4 from
at distribution voltage and Single Buyer other distributors and 1 from the
import power from the grid. Manages Power Purchase Agreement Energy Commission. It also includes 2
(PPA) and settlement process members from distribution generators,
1 consumer, 2 observers from TNB, as
Interconnected Party well as additional members if required by
Peninsular Malaysia the Distribution Code Chairman (DCC).
Equally as important as the National and State Grids that serve as backbones of
electricity supply, ensuring that industries and the national economy continues to
thrive and grow, the MGC and MDC are crucial components that regulate the ESI.
The regulations also promote healthy competition between all the players involved in
the generation, transmission and distribution of electricity, while securing the interests
of consumers—from large industries to residential users—who can be assured of
reliable and stable power supply and minimal incidences of electricity lapses.
20
Feature
Connecting
Laos
the Region
Myanmar
The ASEAN Power Grid
Thailand
Vietnam
Philippines
Cambodia
Malaysia
Brunei
Singapore
Indonesia
The initiative for ASEAN-wide collaboration in energy As explained by Razib, the project aims to enable the sale
matters can be traced back to June 1986 and the signing of electricity from Laos to Singapore using transmission lines
of the Agreement on ASEAN Energy Cooperation in running through Thailand and Malaysia. “That agreement
Manila. Then, slightly more than 10 years later, the APG will be signed in 2016, with operation date starting in
was mooted at the Second ASEAN Informal Summit 1997, 2018,” he explained.
held in Kuala Lumpur.
According to the Joint Statement on the LTMS-PIP, which
According to Abdul Razib Dawood, Head Market was issued in September last year, a Working Group has
Operations Unit at the Energy Commission, one been set up to “study the technical viability of cross-border
example of the APG at work is a recent interconnection power trade of up to 100MW from Laos to Singapore,
between Sarawak and West Kalimantan in Indonesia. In using existing interconnections.”
21
Driving Forces
Part of the driving force behind the
LTMS-PIP is Laos’ aim to become the
“Battery of Southeast Asia” via its
hydropower projects. The country
already generates 3.2GW worth of
power through such sources, and
exports around two-thirds of that to
neighbouring countries such as China,
Myanmar, Thailand, Cambodia and
Vietnam. By the year 2030, that
capacity is expected to reach 24GW.
Obstacles in Sight
That being said, several challenges
still need to be overcome. As Razib
Dawood explained, “This includes self-
sufficiency policy adopted by each
country where export is only allowed
when there is excess energy.”
22
Feature
23
Intelligent Net works
Multi-Impact Monitoring
Across all economic sectors around the world, technology is enhancing
the execution of processes, and in the energy sector, innovative
systems are already delivering on its promise to improve operations.
One of such examples is the smart grid, which encompasses the entire
electricity network including generation, transmission and user stages
of energy supply. In developed nations, as well as emerging ones—
where growth is occurring rapidly—such systems are essential to
ensure that advancement is economically and environmentally viable.
Increasing Renewable
Generation
Improved Grid
Reliability
Reduce Non
Technical Losses
EV*
Integration
Rising Peak
Demand
Ageing
Infrastructure
*EV – Electric Vehicle Some factors that can catalyse the adoption Source: Bloomberg New
*AMI – Advanced Metering Infrastructure of smart grids include an increase in peak Energy Finance 2012
*HEMS – Home Energy Management System demand, ageing conventional infrastructure,
and the rising adoption of electric vehicles
*BEMS – Building Energy Management System
(EV) by households.
24
Feature
“Smart meters
provide real-time
online readings
for both the
consumer and
supplier.”
– Abdul Razib Dawood
Head of Market Operation Unit
As a rapidly advancing economy, intelligent meters (that provide real-time users with financial constraints can
Malaysia stands to benefit tremendously usage information and can turn on monitor their overall consumption in real
from the implementation of smart grid appliances at off-peak periods) to smart time, and decide whether they want to
systems. More so, the government substations that can process consumer turn off appliances that consume high
plans to incorporate more renewable usage statistics before sending to the amounts of electricity.”
sources of power into the national generators.
energy mix. In addition, as the nation In the future, however, smart meters will
transitions into a high-income, industrial Real TimE be used to encourage consumption
nation, customers will increasingly of electricity during off-peak hours, in
demand a higher level of reliability Following Tenaga Nasional Berhad’s addition to monitoring and managing
of supply, which translates to a need (TNB) launch of its 1,000-unit smart usage. According to Razib, under the
to increase the operational efficiency meter pilot smart grid project funded concept of Time-of-Use (TOU) electricity
in the generation, transmission and by the government across Melaka and pricing, a higher tariff may be introduced
distribution of power. Putrajaya (800 and 200 respectively) for peak times—for instance, between
in 2013, Razib Dawood—Head of 12 noon and 3:00PM, when it is most
A smart grid is an infrastructural system Market Operation Unit at the Energy expensive to generate and supply
of power generation, transmission and Commission—notes that while this is an electricity—and a lower tariff for off-
supply that utilises ICT to enable a bi- experimental programme, it is expected to peak periods to encourage consumers
directional communication between the form the basis for future development. to only turn on their power-intensive
end-users and the distributors, in contrast “The expected outcome currently is the appliances then.
to existing systems where information situational awareness and consumers’
only flows from the generators to the behaviour,” he explained. On a larger scale, a smart grid will
users. Tapping into the available data, allow grid owners to monitor and curb
the consumption patterns of electricity The smart meters allow bi-directional power proliferation and theft. “With a
users are more accessible to power communication between the grid and smart meter for instance, communication
producers, who can determine peak times the consumers, while enabling the between the consumer and supplier is
more accurately. latter to monitor their current and past two-way, and it is easier for electricity
electricity consumption in real-time on distributors to detect occurrences of theft,”
It comprises equipment that can be a display panel. “Will that motivate Razib points out. He also notes that an
implemented in various stages of the users to save more?” Razib asks, additional benefit for electricity utilities
generation to consumption chain, from adding, “By the middle of the month is that they reduce the time and cost
25
Feature
In addition to the smart meters, TNB has already implemented its Phasor Measurement
Unit (PMU), which forms a core part of smart grids, and helps protect the grid and prevent
massive blackouts from the cascading impact of a single error. In essence, the aims and
benefits of implementing a smart grid is multi-faceted and favourable to the entire energy
industry, as well as the economic development of the nation—including operational and
network efficiency, reliability, emission reduction and customer empowerment.
26
e e
Get Smart!
Security in Energy
Storage Systems
and Smart Meters
Having been introduced in the early 20th
century to centralise the transmission and
distribution of electricity, the efficacy of
the conventional grid system diminished
in the 21st century, owing to increased
complexity and demand. Thus, utilities
have been looking for ways to better
manage performance and increase
efficiency. This has been made possible
thanks to the advent of ICT and the
introduction of Smart Grids.
28
Innovation
As mentioned, conventional power protocol/internet protocol (TCP/IP) to They are part of what is known as
grids are facing a number of problems, communicate with the utility. an Advanced Metering Infrastructure
with efficient distribution being one (AMI), which aside from allowing the
of the most pressing. This is because Aside from measuring electricity utility to remotely read users’ meters,
populations are increasing, and so consumption and collating information also provides the necessary information
too is demand – especially from urban on power quality, load management for consumers to better manage their
areas. As such, what has resulted is and outages, smart meters can also own electricity consumption. Thus, they
near infinite demand with finite supply. be upgraded automatically through can set certain appliances such as
the internet connectivity they have with
Of course, demand varies according to the utility. Also, they help cut down
time and date. For example, in Malaysia, on fraud and electricity theft as any
home air-conditioning – which consumes attempts at tampering will be detected
a lot of power – will usually be on during immediately.
the evening and night as that is when
most people are at home. Smart meters also play an important
role in the Smart Grid, as they can
The conventional grid system is not detect surges and outages in individual
able take into account such changes. homes and units. These are usually the
But Smart Grids can. They can help earliest signs of grid failure, and the
the utility better handle demand by sooner they are detected, the faster the
enabling it to ascertain when more utility and other relevant bodies can
power should be allocated to a certain work on rectifying them.
neighbourhood through calculations of
usage history.
What Makes
the Grid Smart?
Malaysia’s largest utility, Tenaga
Real-time monitoring of electricity usage Nasional Berhad, rolled-out smart
digital meters, a key component of
is made possible through the employment smart grids which enable real-time
of a smart meter. These devices are two-way communication between
advanced versions of traditional electricity the meter and the provider.
meters, and use transmission control
29
washing machines to only run during off- decide the type of power source their Storing Power
peak hours so as to cut down on costs. electricity comes from. For example,
people can choose if they want to have Another advantage of the Smart Grid is
The Smart Grid system enhances the most of their energy supply coming that it helps decentralise the distribution
drive to embrace green energy. This from renewable sources such as solar of electricity, thus strengthening energy
is because it also allows consumers to photovoltaic and hydropower. security. For example, under the present
Compressed Air
Energy Storage system
system, a fault anywhere in the
grid could lead to a domino effect
that knocks out power stations and
substations. This was what happened in
Malaysia in 1996, when a transmission
line tripping resulted in a peninsula-
wide blackout.
The Price of Security That is not to say that Malaysia is not embracing the Smart Grid.
While there are other forms of energy Already the country’s largest utility, Tenaga Nasional Berhad
storage, these two are the most suitable (TNB) has been replacing its old analogue meters with smart
for Malaysia. However, it should be
said that energy storage systems are
digital meters, and it has allocated more than RM8 billion over the
quite costly. For example, according to next four years to enhance transmission networks. It is inevitable:
Imre Gyuk, the manager of the Energy the Malaysian grid is on the road to getting smart.
31
Becoming a
Distribution Licensee
Proper licensing and application steps need to be adhered to if a party wishes
to establish an electrical connection to the distribution grid in order to become a
distribution licensee. These connection requests are subject to approval by the Energy
Commission and the utility, which examine each application to ensure that all required
standards are met. Energy Malaysia talks to Nurhafiza Mohamed Hasan, Head
of Licencing at the Energy Commission to learn more about these procedures.
Parties Involved feeder poles, some large ones such case, the mall is required to procure
as steel mills and shopping malls, as a distribution licence,” Nurhafiza
When a bulk supply connection to well as some townships source their explained, adding that this is subject
the distribution grid is required, the power directly from the grid as they to the Distribution Code.
Distribution Code must be consulted to require large amounts of electricity to
ascertain that all the requirements for run. They then channel this electricity Licensing
safe and appropriate work are met. to their customers via their own
The Code applies to both the utility and distribution network. “Under Section 9 of the Electricity
licensees who are seeking a connection Supply Act, users of electricity need
to the distribution grid. “Shopping malls usually receive a to be licenced, with some exemptions
bulk supply from TNB, for example given such as to users of less than 5
Although most buildings are linked to at 11 kV, before distributing the kW,” she said. Licensing rules are
the grid via electrical sub-stations and electricity to its various tenants. In this governed by the legislation and
A Single Line
Diagram that TNB METER
is endorsed by
a professional
X X TNB
engineer is among
CUSTOMER
the documents 33kV BUSBAR
required for a X X
distribution licence
application.
33/11kV 33/11kV
8 MVA 8 MVA
X X
11kV BUSBAR
X X X X
X X X X
11/0.433kV 11/0.433kV 11/0.433kV 11/0.433kV
2 MVA 2 MVA TO MSB 2 MVA 2 MVA
TO MSB CHILLER
X X X X
TO MSB TO MSB
OFFICE SHOPPING MALL
32
Guidelines
2
– Financial analysis to evaluate the licensee’s
Applicant procures the business viability and instructions to the Energy Commission
Development Order (approved by and licensee. Additionally, there is also
– Copy of the Single Line Diagram (endorsed
local authorities) and the Bulk Supply by a professional engineer) a visiting engineer, who is responsible
Agreement (approved by TNB) to inspect the installations regularly and
– Copy of the Electrical Service
Engineer’s Certificate provide their independent opinion to
both parties.
5 9
imposed. If cases of tariff overcharging
Applicant initiates the licence Electrical Service Engineer
surface, the licensee is given a period
application process online at www. submits Forms G & H to TNB
of one month to revert the charges to
oas.st.gov.my (RM100 application fee) to energise the system
the correct amount. Failure to do so
will result in action being taken against
the licensee under section 37 of the
Approval for the licence application takes around 60 working days. For application exceeding Electricity Supply Act 1990 (Amendment
30 MW, approval from the Minister of Energy, Green Technology and Water is needed. 2001), which includes fines.
The Energy Commission has spelled out several steps and requirements that need to be
adhered to for the distribution licence application process, as well as during the day-
to-day operations of a distribution licensee. These prerequisites and stipulations ensure
that only qualified and competent parties are allowed to distribute electricity, providing
peace of mind for their consumers, and the utility as well.
33
Supplying Electricity
When an Independent Power Producer (IPP) wishes to connect to the grid
in order to sell its supply of electricity, it has to adhere to several conditions
and criteria set by the Energy Commission and the grid owner, Tenaga
Nasional Berhad (TNB). These stipulations are usually set before any actual
connections are made to help ensure that the IPP meets all the requirements
necessary, which include producing a supply with acceptable power quality
and keeping the cost of tariff at a reasonable level. Energy Malaysia spoke to
Abdul Razib Dawood, Head of Market Operation Unit at the
Energy Commission to learn about these connections.
Connection Process
comes to connecting to the grid, the IPP a robust generation and supply of
When it is being considered for a still has to enlist the help of TNB as it is electricity to the grid. The public licence
licence to produce and sell electricity to the grid owner,” Abdul Razib said. will only be given to the IPP once the
the grid, an IPP is usually looked at for project details are finalised.
a number of tender packages, such as Therefore, the task of dealing with
for interconnection facilities. “There is interconnection facilities is handed over Hence, the current model of connection
certainty in this interconnection facilities to TNB by the IPP. The IPP’s responsibility, is as follows:
tender package. However, when it meanwhile, is to ensure that it builds
TNB comes in
Once the transmission lines from the IPP are ready, the task
of interconnection to the grid is handed over to TNB.
34
Guidelines
1 Release of Generation
Schedule: Issued by single
buyer, it is the assignment of power
3 Actual Dispatch Time of Electricity: The generator’s
availability to provide supply according to demand
through the redeclaration from the schedule is being
generation to meet anticipated monitored in real time. The GSO (in this case TNB),
demand. It includes information from checks the dispatch time and parameters.
the user (IPPs) in accordance with the
power purchase agreement (PPA), • If GSO is OK with the time of delivery and parameters,
to ensure that security and quality of a report of dispatch information is recorded by the GSO
supply is sufficient to meet demands. and single buyer provides settlement information such as
processes and procedures for calculation of payment.
When to Send: Done every day,
1 day before Actual Dispatch Time, • GSO conducts the dispatch based on real time
at/before 5pm, and done every day information and guided by the schedule.
2 Generation Scheduling and • SIf GSO is not OK with the time of delivery and
dispatch is conducted based parameters, IPPs have to redispatch another generator in
on the least-cost principle, which their system to meet the demand, then once it can already
requires cheaper plants to be provide the needed power, a report of dispatch information
dispatched first, followed by the is recorded by the GSO and single buyer provides
more expensive ones. settlement information such as processes and procedures for
calculation of payment.
Assessing Applications The IPPs under consideration must then lowered to 800 MW for a particular day,
present their details of the project and the IPP has to declare this lower output
Regardless of the type of power their offers for the tariff. Selection is then rate so that payment adjustments can be
generation, be it from coal, gas or based on criteria such as project cost, made.”
open cycle power plants, there is an power output capacity and tariff rate
open bidding system in selecting the offered by the bidder. “If a failed dispatch instruction occurs,
most suitable IPP candidate to supply where the IPP dispatches electricity at a
power to the grid. With international Ensuring Quality lower capacity than agreed upon in the
competitive bidding, supply quality PPA, a penalty is meted out to the IPP,”
among the power producers is assured, In making sure that the IPP’s power plant he added. In short, the PPA details all the
which in turn gives rise to a stable, high is running at stated capacity, the Energy requirements that have to be followed by
quality power supply at a sensible cost. Commission requires that it declares its the IPP, such as the forced outage rate
output capacity on a daily basis. As and planned outage rate not exceeding a
“To be eligible for consideration, the Abdul Razib explained, “For example, 4% - 6% limit. Failure to adhere to these
bidding party must be a consortium if the power purchase agreement (PPA) conditions will be tantamount to a breach
consisting of at least 51% Malaysian between the IPP and TNB is 1000 MW, of the agreement between the IPP and
stakeholders,” Abdul Razib revealed. but for some reason the IPP’s output is TNB, and penalties will be issued to the IPP.
35
Malaysian Electricity
Demand and Supply
As Malaysia faces a continually-expanding population and an industrial growth
spurt fuelled by the nation’s quest to attain a developed status, the need to provide
a stable, reliable and adequate supply of electricity to energise this progress has
become a top priority. The Electricity Supply Industry Outlook 2015 by the Energy
Commission shed some light on the electricity demand and supply landscape in the
country in the near future.
36
Analysis
2008
2009
2010
2011
2012
2013
2014
2015
2016
2018
2019
2020
2021
2022
2023
2024
2025
2026
2028
2029
2030
2031
2032
2033
2034
2035
2007
2017
2027
be commissioned in 2020 will be
put into operation in 2018 instead.
This move is also to reduce the strain
27,000 Peak Demand Forecast, MW
of meeting power demand in the
short term. 25,000
to come exhibits a
distinct uphill trend,
with both electricity
sales and generation Peninsular Malaysia Electricity Demand Forecast 2015 Peninsular Malaysia Electricity Demand Forecast 2014
registering a steady
climb on a year-on-
year basis. Source : Peninsular Malaysia Electricity Demand Forecast 2015.
37
Analysis
18,000
2,000
0
2005
2006
2008
2009
2010
2011
2012
2013
2014
2015
2016
2018
2019
2020
2021
2022
2023
2024
2025
2026
2028
2029
2030
2031
2032
2033
2034
2035
2007
2017
2027
2008
2009
2010
2011
2012
2013
2014
2015
2016
2018
2019
2020
2021
2022
2023
2024
2025
2026
2028
2029
2030
2031
2032
2033
2034
2035
2007
2017
2027
2008
2009
2010
2011
2012
2013
2014
2015
2016
2018
2019
2020
2021
2022
2023
2024
2025
2026
2028
2029
2030
2031
2032
2033
2034
2035
2007
2017
2027
38
Analysis
39
Executing EE
No-Cost EE Measures :
Energy Management System
– Introduction of energy management policy
– Establishment of internal energy management committee
– Plan and implement energy saving measures
– Monitoring and verification
– Review results for continual improvement
40
Analysis
41
World Forum on
Energy Regulation
42
On-Site
43
The 26th World
Gas Conference
Held in Paris from the 1st to the 5th of June, the 26th
World Gas Conference was organised by the French
International Gas Union (IGU), focusing on the crucial
role that gas will play around the world. This is the
second time the conference was held in Paris, the first
being in 1937.
44
On-Site
45
Dialogue with
Stakeholders
With the increased tariff for natural gas, the Energy Commission engaged with its stakeholders to
discuss the methods and details for determining Gas Malaysia Berhad’s (GMB) natural gas tariff
as well as the issues that would surface from the increase.
With Gas Malaysia Berhad (GMB) increasing on the 4th of August. The GCPT mechanism cushions
the tariff – effective on the 1st of July 2015 – for the fluctuations in international prices of fuel, such as
natural gas, the Energy Commission engaged with gas, coal or medium fuel oil by revising the prices
its stakeholders in several sessions to discuss the only once every six months. The mechanism is also
issues that would surface from the increase. The main designed for consumers to know the actual increase
objective of the sessions was to explain the method of fuel prices.
and details for determining GMB’s natural gas tariff.
With an increase in electricity tariff, Tenaga Nasional
Among the sessions the Energy Commission had Berhad (TNB) absorbs the initial cost and once in
with its stakeholders included Dialogue Sessions with every two months, the average increase will be
the Federation of Malaysian Manufacturers (FMM) removed, leaving only the real rise in fuel for which
Committee on the 19th of May and the 4th of June the consumers are charged. With that, consumers will
2015, and The Malaysian Iron & Steel Industry be aware of the actual rise in fuel prices.
Federation (MISIF) on 15 July 2015.
The revised tariff was increased to RM21.80 per
The implementation of the Gas Cost Pass-Through million British thermal units (mmBtu) from RM19.77
(GCPT) mechanism was also part of the agenda, with per mmBtu due to higher purchasing price of the fuel
a briefing on the mechanism to the FMM members procured by GMB from PETRONAS.
46
On-Site
47
On-Site
Organised by the Ministr y of Energy, Green Two other MoUs followed; one of them between
Technology and Water (KeTTHA), the 6th International Prasarana, the asset owner and operator of the country’s
Greentech & Eco Products Exhibition and Conference two LRT and the KL Monorail networks, and CMS
Malaysia (IGEM) was officiated by Prime Minister Consortium on the expansion of the COMOS Electric
Dato Sri Najib Razak on the 11th of September 2015 Car Sharing Programme. The other MoU involved
at the Kuala Lumpur Convention Centre. Wi t h Pertubuhan Peladang Kawasan (Area Farmers’
the theme Powering the Green Economy, IGEM 2015 Association) Pendang Selatan in Kedah and Free the
centred around five key areas – green energy, green Seed – a company specialising in paper production
transportation, green buildings, solid waste technology using biotechnology – to convert biomass sourced from
and management, as well as clean water technology paddy husks into biodegradable packaging products.
and management.
KeTTHA Minister Datuk Seri Panglima Dr Maximus
In his speech, Dato Sri Najib said, “Malaysia’s Johnity Ongkili welcomed the partnerships, saying,
transition to a green economy has the potential ”We are pleased with the numerous collaborations
to create enhanced trade opportunities by opening established today in line with the Ministry’s efforts to
new export markets for environmental goods further pursue growth in the green technology sector. It
and services, increasing services and greening also reaffirmed the role of IGEM 2015 in encouraging
international supply chains.” The opening ceremony co operation as well as trade and business in green
also saw the signing of a Memorandum of technology among the member countries.”Spread
Understanding (MoU) to fortify co-operation between across six halls, the four-day event featured conferences,
the Malaysian and Cambodian governments in the seminars and over 400 exhibition booths with exhibitors
green technology field. from 20 countries.
48
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Advises
Ministers on all matters concerning the national
policy objectives for energy supply activities, the supply and
use of electricity, the supply of gas through pipelines and the use of gas. Licenses and certifies
electricity and piped gas suppliers, competent electricity and
Regulates gas personnel, training providers, contractors, equipment and
installations, energy service companies and energy managers.
electricity and piped gas tariffs and
the quality of supply services, as well as promote
competition and prevent misuse of monopoly power.
Monitors and audits
performance and compliance of licensed and certified suppliers,
Promotes service providers, installations, equipment importers,
manufacturers and retailers.
good practices, as well as research, development
and innovation in the electricity and piped gas industries.
Investigates
Plans and develops complaints, accidents, offences and industry issues;
arbitrates and enforces compliance.
laws, regulations, rules, codes, guidelines, programmes for the orderly
development and functioning of the electricity and piped gas industries.