Businesses and consumers today are living in a time where being part of the clean energy revolution is becoming increasingly easier and more affordable. A few years ago, participating in the movement meant sourcing your own technology, such as solar panels, and installing them in your yard or rooftop.
Fast-forward to today, we see a clear diversification – and democratisation – of clean energy vehicles, ranging from government-led initiatives to private sector tools. As the clarion call to join the sustainable energy revolution grows louder, it’s evident that there is a need and demand for greater inclusion and public participation.
Enter the Green Electricity Tariff, or GET, is an initiative by the Government of Malaysia, introduced in 2022 to serve as a driver for this purpose. In a nutshell, this innovative tariff allows consumers to purchase green electricity generated from renewable energy, directly from utilities. It’s a great initiative for consumers or businesses interested in being part of the sustainable energy value chain without extensive investment. Here, Energy Watch explores seven interesting facts about the GET that you should know.
1. It’s a first come, first serve basis (with a limited quota!)
Applications for the GET Programme will be processed and approved on a first-come, first-served basis, subject to the Green Electricity Tariff (GET) quota.
The good news is that the Government has increased the available quota to 6,600 gigawatt-hour (GWh), up from the 4,500 GWh offered last year.
Information on the quota is published on the Malaysia Green Attribute Tracking System or mGATS website (www.mgats.com.my).
2. You’re paying a surcharge for renewable energy costs, not fossil fuel (ICPT) related costs
Under Malaysia’s tariff setting system, generation costs have to be adjusted every six months through the Imbalance Cost Pass Through (ICPT) mechanism.
The ICPT takes into account increases or decreases in generation costs, which consist primarily of the cost to purchase fossil fuels, such as coal and gas, for power plants.
Subscribers of GET, however, are exempt from ICPT surcharges, as the energy is not generated from fossil fuels. In this sense, for the second half of 2023, the 21.8 sen/kWh tariff for GET is directly paid directly in exchange for green energy.
3. More than 10 multinational companies have come onboard
This includes the likes of AEON, CIMB Bank, Dutch Lady Milk Industries, and Gamuda Berhad.
The trend is evident for businesses: The number of RE100 MNCs (Multinational Corporations) committed to sourcing 100% renewable electricity by 2035 has doubled from just over 200 in 2019 to over 400 in 2023.
However, there have been concerns that a large energy user could still claim to use zero-carbon electricity for their operations when in reality the physical electricity flow towards their processes could still be carbon intensive. Hence, a holistic approach to reforming the industry as a whole is still necessary.
4. The renewable energy generated is primarily from Solar and Hydro sources
The programme’s Green Electricity is generated by solar power plants under the Large Scale Solar (LSS) Programme, TNB’s hydropower stations , or any other renewable energy plants which may be approved by the Energy Commission from time to time.
However, the lack of product differentiation between renewable electricity certificates (i.e, solar versus hydro) does not allow businesses to develop a credible electricity decarbonisation strategy that considers the temporal balances of renewable electricity they procure.
Besides this, companies are increasingly considering bringing additional renewable projects online – funnelling funds towards GET might distract or hinder that.
Therefore, it is essential to have an avenue for these MNCs to meaningfully negotiate, invest in and enable specific renewable projects to bring additional value to the nation’s decarbonisation process. This can be done by enabling third-party access to the grid (without TNB being heavily involved) and other market liberalisation reforms.
5. Subscriptions are calculated in blocks, and in 1-year cycles
A residential GET Consumer is required to subscribe to Green Electricity in blocks of 100 kWh, while a non-residential GET Consumer’s subscription block consists of 1,000 kWh.
Previously, the amount of Green Electricity customers could subscribe to was limited to 30 percent (30%) of average monthly consumption. However, this was recently extended to 100% and took effect on 21 July 2023.
6. It’s a major image boost for your brand!
Subscribing to GET means that you’re supporting an environmentally friendly and green agenda, meeting your sustainable targets by offsetting carbon emissions, and boosting your “eco-friendly” brand image.
The GET programme is backed by the Malaysia Renewable Energy Certificate (mREC) which is recognised internationally one month after the end of each year.
7. You’re contributing to the development of renewable sources in the country.
The payment collected from the GET programme will be used to support the implementation of national renewable energy agenda and initiatives.
In addition, you are supporting the growth of the renewable energy industries and reducing reliance on gas or coal-fired power plants – this was echoed by Nik Nazmi, Minister of Natural Resources, Environment and Climate Change in his latest social media response to public queries.
Ultimately, the GET programme is a part of the nation’s initiatives to achieve net-zero GHG emissions by the year 2050, with the aim of helping the nation reduce its carbon footprint and meet international agreement targets. If this article has piqued your interest, and you’d like to be part of this, head on over to their website here to get started.