DOI: https://doi.org/10.14710/ijred.2022.45662

Prospects and Challenges of Malaysia's Distributed Energy Resources in Business Models Towards Zero – Carbon Emission and Energy Security

1School of Electrical Engineering, College of Engineering, Universiti Teknologi MARA, Cawangan Pasir Gudang, Masai, Johor, Malaysia

2Solar Research Institute (SRI), Universiti Teknologi MARA, 40450 Shah Alam, Selangor, Malaysia

3School of Electrical Engineering, College of Engineering, Universiti Teknologi MARA, 40450 Shah Alam, Selangor, Malaysia

4 Tropical Renewable Energy Center, Faculty of Engineering, Universitas Indonesia, Kampus Baru UI, Depok 16424, Indonesia

View all affiliations
Received: 8 Apr 2022; Revised: 22 Jul 2022; Accepted: 1 Aug 2022; Available online: 5 Aug 2022; Published: 1 Nov 2022.
Editor(s): Grigorios Kyriakopoulos
Open Access Copyright (c) 2022 The Author(s). Published by Centre of Biomass and Renewable Energy (CBIORE)
Creative Commons License This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

Citation Format:
Abstract
For a decade, distributed energy resources in Malaysia have growth as one of the paths in battling with sustainable energy crisis and environmental pollution. Several intriguing initiatives and incentives have been established to encourage the use and sales-side of renewable energy at the distribution consumers. However, Malaysia's distributed energy resources penetration is still at its slow pace, with only 7.6% (excluding large hydropower) shared in energy mix generation. Therefore, innovation in power systems is required to drive the uptake of distributed energy resources. This paper reviews the business model innovation that allows distributed energy resources to participate in national grid services and the wholesale electricity market. Different technical and non-technical challenges with high shares of variable renewable energy in power systems are highlighted, and the current update on compensation scheme, Net-Energy-Metering 3.0 is also discussed. Along with these challenges, stance the prospect of adopting distributed energy resources innovation projects such as peer-to-peer energy trading and virtual power plant in the electricity market. It could further furnish the benefits to a better environmental and power system in terms of carbon dioxide avoidance, grid flexibility and increase revenue for distributed energy resources owners respectively. Through the review, it led to observation that policy and regulatory in Malaysia are the main factors in accelerating the distributed energy resources deployment. Therefore, the abilities and roles of Malaysia Energy Commission and Sustainable Energy Development Authority as a regulator and implementing agencies are crucial in determining the present and future distributed energy resources business model.
Fulltext View|Download
Keywords: Distributed energy resources; Clean energy; Energy security; P2P energy trading; Virtual power plant

Article Metrics:

Article Info
Section: Review Article
Language : EN
Recent articles
Environmental Sustainability Goal and the Effect of Resources Extrication: A "Give and Take Perspective” Effect of a Detached Bi-Partition on the Drag Reduction for Flow Past a Square Cylinder Emissions Characteristics and Engine Performance from the Interaction Effect of EGR and Diesel-Ethanol Blends in Diesel Engine A Review on the Recent Breakthrough Methods and Influential Parameters in the Biodiesel Synthesis and Purification Prospects and Challenges of Malaysia's Distributed Energy Resources in Business Models Towards Zero – Carbon Emission and Energy Security Technical-Environmental Assessment of Energy Management Systems in Smart Ports More recent articles
Most cited articles
Bioethanol Production from Iles-Iles (Amorphopallus campanulatus) Flour by Fermentation using Zymomonas mobilis Design and Economic Analysis of a Photovoltaic System: A Case Study Application of Hydrothermal Treatment to High Concentrated Sewage Sludge for Anaerobic Digestion Process A Review on Solar PV Based Grid Connected Microinverter Control Schemes and Topologies Economic Impact of CDM Implementation through Alternate Energy Resource Substitution More cited articles
  1. Australian Energy Council. (2020). Solar Report. https://www.energycouncil.com.au/media/7687/australian-energy-council-solar-report_march-2017.pdf Accessed on 12 May 2022
  2. Braithwait, S. D. (2018). Retail Pricing Responses to the Challenge of Distributed Energy Resources. Electricity Journal, 31(8), 38–43. https://doi.org/10.1016/j.tej.2018.09.001
  3. Burger, S. P., & Luke, M. (2017). Business Models for Distributed Energy Resources: A Review and Empirical Analysis. Energy Policy, 109, 230–248. https://doi.org/10.1016/j.enpol.2017.07.007
  4. Celik, A. N. (2007). Effect of Different Load Profiles on the Loss-of-Load Probability of Stand-Alone Photovoltaic Systems. Renewable Energy, 32(12), 2096–2115. https://doi.org/10.1016/j.renene.2006.11.002
  5. Cole, W., Frew, B., Mai, T., Sun, Y., Bistline, J., Blanford, G., Young, D., Marcy, C., Namovicz, C., Edelman, R., Meroney, B., Sims, R., Stenhouse, J., & Onohoo-vallett, P. (2017). Variable Renewable Energy in Long-Term Planning Models : A Multi-Model Perspective Variable Renewable Energy in Long-term Planning Models : A Multi-model Perspective. https://www.nrel.gov/docs/fy18osti/70528.pdf Accessed on 12 May 2022
  6. Denholm, P., & Mai, T. (2019). Timescales of energy storage needed for reducing renewable energy curtailment. Renewable Energy, 130(2019), 388–399. https://doi.org/10.1016/j.renene.2018.06.079
  7. Do Prado, J. C., Qiao, W., Qu, L., & Agüero, J. R. (2019). The next-generation retail electricity market in the context of distributed energy resources: Vision and integrating framework. Energies, 12(3). https://doi.org/10.3390/en12030491
  8. Energy & Meteo Systems. (2020). Virtual Power Plant. https://www.energymeteo.com/products/virtual_power_plant/technology.php Accessed on 2 Nov 2021
  9. Etxegarai, A., Eguia, P., Torres, E., Iturregi, A., & Valverde, V. (2015). Review of grid connection requirements for generation assets in weak power grids. Renewable and Sustainable Energy Reviews, 41, 1501–1514. https://doi.org/10.1016/j.rser.2014.09.030
  10. Ferdous, S. M., Member, S., Shafiullah, G. M., & Member, S. (2020). Dynamic Frequency and Overload Management in Autonomous Coupled Microgrids for Self-Healing and Resiliency Improvement. 8, 116796-116811 https://doi.org/10.1109/ACCESS.2020.3004185
  11. Foo, K. Y. (2015). A vision on the opportunities, policies and coping strategies for the energy security and green energy development in Malaysia. Renewable and Sustainable Energy Reviews, 51, 1477–1498. https://doi.org/10.1016/j.rser.2015.07.041
  12. Fortune Business Insights. (2019). Market Research Report. https://www.fortunebusinessinsights.com/industry-reports/virtual-power-plant-market-101669 Accessed on May 2020
  13. Hadjidemetriou, L., Kyriakides, E., & Blaabjerg, F. (2013). Synchronization of grid-connected renewable energy sources under highly distorted voltages and unbalanced grid faults. IECON Proceedings (Industrial Electronics Conference), 1887–1892. https://doi.org/10.1109/IECON.2013.6699419
  14. Husain, A. A. F., Huda, M., Phesal, A., Zainal, M., Ab, A., Anisa, U., Amirulddin, U., & Junaidi, A. H. J. (2021). A Decade of Transitioning Malaysia toward a High-Solar PV Energy Penetration Nation. Sustainability, 13(17). https://doi.org/10.3390/su13179959
  15. IEA (International Energy Agency). (2019a). Energy Security. https://www.iea.org/areas-of-work/ensuring-energy-security Accessed on 8 Oct 2021
  16. IEA (International Energy Agency). (2019b). Global Solar PV Market Set for Spectacular Growth Over Next-5 Years. https://www.iea.org/news/global-solar-pv-market-set-for-spectacular-growth-over-next-5-years Accessed on 12 Oct 2021
  17. IEA (International Energy Agency). (2019c). The mysterious case of disappearing electricity demand. https://www.iea.org/commentaries/the-mysterious-case-of-disappearing-electricity-demand
  18. IEA (International Energy Agency). (2019d). World Energy Outlook 2019. World Energy Outlook 2019. https://www.iea.org/reports/world-energy-outlook-2019 Accessed on 20 Feb 2021
  19. IEA (International Energy Agency). (2020). Electricity Market Report – December 2020 (Issue December). Electricity Market Report – December 2020 (windows.net) Accessed on 15 Aug 2021
  20. Ikegami, T., Ogimoto, K., Yano, H., Kudo, K., & Iguchi, H. (2012). Balancing power supply-demand by controlled charging of numerous electric vehicles. 2012 IEEE International Electric Vehicle Conference, IEVC 2012. https://doi.org/10.1109/IEVC.2012.6183216
  21. Ilham, N. I., Dahlan, N. Y., & Hussin, M. Z. (2022). Assessing Techno-Economic Value of Battery Energy Storage with Grid-Connected Solar PV Compensation Schemes for Malaysian Commercial Prosumers. 12(2), 759–767. https://doi.org/https://doi.org/10.20508/ijrer.v12i2.13011.g8464
  22. IqtiyaniIlham, N., Hasanuzzaman, M., & Hosenuzzaman, M. (2017). European smart grid prospects, policies, and challenges. Renewable and Sustainable Energy Reviews, 67, 776–790. https://doi.org/10.1016/j.rser.2016.09.014
  23. IRENA (International Renewable Energy Agency). (2019). Market Integration Of Distributed Energy Resources Innovation Landscape Brief. https://www.irena.org/-/media/Files/IRENA/Agency/Publication/2019/Feb/IRENA_Market_integration_distributed_system_2019.pdf?la=en&hash=2A67D3A224F1443D529935DF471D5EA1E23C774A Accessed on 20 Aug 2021
  24. IRENA (International Renewable Energy Agency). (2021). Renewable Capacity Statistiques De Capacité Estadísticas De Capacidad. IRENA_RE_Capacity_Statistics_2021 (1).pdf Accessed on 2 Dec 2021
  25. Jaalam, N., Rahim, N. A., Bakar, A. H. A., Tan, C. K., & Haidar, A. M. A. (2016). A comprehensive review of synchronization methods for grid-connected converters of renewable energy source. Renewable and Sustainable Energy Reviews, 59, 1471–1481. https://doi.org/10.1016/j.rser.2016.01.066
  26. Kementerian Tenaga dan Sumber Asli. (2021). Program Net Energy Metering 3.0 (NEM 3.0) Tawar Kuota Solar 500MW Untuk 3 Inisiatif Baharu. NEM 3.0 – Renewable Energy Malaysia (seda.gov.my) Accessed on 4 Apr 2021
  27. Bird, L., Milligan, M., & Lew, D. (2013). Integrating variable renewable energy: Challenges and solutions. https://www.nrel.gov/docs/fy13osti/60451.pdf Accessed on 10 Feb 2021
  28. Li, R. (2017). Comprehensive Benefit Evaluation Method of Distributed Generation/Microgrid Projects Based on Different Business Models. Dianwang Jishu/Power System Technology, 41, 1748–1758. https://doi.org/https://doi.org/10.13335/j.1000-3673.pst.2017.0042
  29. Maanavi, M., Najafi, A., Godina, R., Mahmoudian, M., & Rodrigues, E. M. G. (2019). Energy management of virtual power plant considering distributed generation sizing and pricing. Applied Sciences, 9(14), 1–19. https://doi.org/10.3390/app9142817
  30. Malay Mail. (2021). Malaysia Exploring Collaboration with US on Solar Energy, says Minister. https://www.malaymail.com/news/malaysia/2021/12/15/malaysia-exploring-collaboration-with-us-on-solar-energy-says-minister/2028656 Accessed on 22 July 2021
  31. Malaysia Energy Commission 2021. For Solar Photovoltaic Installation Under Net Offset Virtual Aggregations (NOVA) Programme For Peninsular Malaysia (Issue 28). Energy Commission - Download (st.gov.my) Accessed on 2 December 2021
  32. Mengelkamp, E., Gärttner, J., Rock, K., Kessler, S., Orsini, L., & Weinhardt, C. (2018). Designing microgrid energy markets: A case study: The Brooklyn Microgrid. Applied Energy, 210, 870–880. https://doi.org/10.1016/j.apenergy.2017.06.054
  33. Mishra, P. P., Latif, A., Emmanuel, M., Shi, Y., McKenna, K., Smith, K., & Nagarajan, A. (2020). Analysis of degradation in residential battery energy storage systems for rate-based use-cases. Applied Energy, 264, 114632. https://doi.org/10.1016/j.apenergy.2020.114632
  34. Miveh, M. R., Rahmat, M. F., Ghadimi, A. A., & Mustafa, M. W. (2015). Power Quality Improvement in Autonomous Microgrids Using Multi-functional Voltage Source Inverters : A Comprehensive Review. Journal of Power Electronics, 15(4), 1054–1065. http://dx.doi.org/10.6113/JPE.2015.15.4.1054
  35. Morstyn, T., Farrell, N., Darby, S. J., & McCulloch, M. D. (2018). Using peer-to-peer energy-trading platforms to incentivize prosumers to form federated power plants. Nature Energy, 3(2), 94–101. https://doi.org/10.1038/s41560-017-0075-y
  36. Zafir, S. R. M., Razali, N. M. M., & Hashim, T. J. T. (2016). Relationship between loss of load expectation and reserve margin for optimal generation planning. Jurnal Teknologi, 78(5–9), 27–33. https://doi.org/10.11113/jt.v78.8783
  37. Nam, K. J., Hwangbo, S., & Yoo, C. K. (2020). A deep learning-based forecasting model for renewable energy scenarios to guide sustainable energy policy: A case study of Korea. Renewable and Sustainable Energy Reviews, 122(January), 109725. https://doi.org/10.1016/j.rser.2020.109725
  38. Next Kraftwerke. (2020). Virtual Power Plant. https://www.next-kraftwerke.com/ Accessed on 2 Sep 2021
  39. Dahlan, N.Y., Ahmad, N., Ilham, N. I., & Yusoff, S.H. (2022). Chapter 4 - Energy security: role of renewable and low-carbon technologies,. In Handbook of Energy and Environmental Security (pp. 39–60). https://doi.org/10.1016/B978-0-12-824084-7.00015-1
  40. Oh, T. H., Hasanuzzaman, M., Selvaraj, J., Teo, S. C., & Chua, S. C. (2018a). Energy policy and alternative energy in Malaysia: Issues and challenges for sustainable growth – An update. Renewable and Sustainable Energy Reviews, 81, 3021–3031. https://doi.org/10.1016/j.rser.2017.06.112
  41. Oh, T. H., Hasanuzzaman, M., Selvaraj, J., Teo, S. C., & Chua, S. C. (2018b). Energy policy and alternative energy in Malaysia: Issues and challenges for sustainable growth – An update. Renewable and Sustainable Energy Reviews, 81, 3021–3031. https://doi.org/10.1016/j.rser.2017.06.112
  42. Oldenbroek, V., Wijtzes, S., Blok, K., & Van Wijk, A. J. M. (2021). Fuel cell electric vehicles and hydrogen balancing 100 percent renewable and integrated national transportation and energy systems. Energy Conversion and Management: X, 9, 100077. https://doi.org/10.1016/j.ecmx.2021.100077
  43. Pahle, M., Pachauri, S., & Steinbacher, K. (2016). Can the Green Economy deliver it all? Experiences of renewable energy policies with socio-economic objectives. Applied Energy, 179, 1331–1341. https://doi.org/10.1016/j.apenergy.2016.06.073
  44. Refaat, S. S., Mohamed, A., & Kakosimos, P. (2018). Self-Healing control strategy; Challenges and opportunities for distribution systems in smart grid. Proceedings - 2018 IEEE 12th International Conference on Compatibility, Power Electronics and Power Engineering, CPE-POWERENG 2018, 1–6. https://doi.org/10.1109/CPE.2018.8372610
  45. H. Saboori, M. Mohammadi and R. Taghe. (2011). Virtual Power Plant ( VPP ), Definition , Concept , Components and Types. 2011 Asia-Pacific Power and Energy Engineering Conference, pp. 1-4, https://doi.org/10.1109/APPEEC.2011.5749026
  46. Sahid, E. J. M., Siang, C. C., & Peng, L. Y. (2013). Enhancing energy security in Malayia: The challenges towards sustainable environment. IOP Conference Series: Earth and Environmental Science, 16(1). https://doi.org/10.1088/1755-1315/16/1/012120
  47. Santos, S. F., Fitiwi, D. Z., Cruz, M. R. M., Cabrita, C. M. P., & Catalão, J. P. S. (2017). Impacts of optimal energy storage deployment and network reconfiguration on renewable integration level in distribution systems. Applied Energy, 185, 44–55. https://doi.org/10.1016/j.apenergy.2016.10.053
  48. SEDA (Sustainable Energy Development Authority). (2019a). Malaysia’s 1st Pilot Run Of Peer-To-Peer (P2p) Energy Trading. http://www.seda.gov.my/2020/11/malaysias-1st-pilot-run-of-peer-to-peer-p2p-energy-trading/ Access on 20 May 2020
  49. SEDA (Sustainable Energy Development Authority) (2019b). Malaysia Can Generate More Electricity If All Roofs Use Solar Panels, Says Yeo. http://www.seda.gov.my/2019/05/malaysia-can-generate-more-electricity-if-all-roofs-use-solar-panels-says-yeo/ Access on 20 May 2020
  50. SEDA (Sustainable Energy Development Authority) (2019c). SELCO. http://www.seda.gov.my/reportal/self-consumption/ Access on 22 May 2020
  51. SEDA (Sustainable Energy Development Authority). (2021). Malaysia Renewable Energy Roadmap (MyRER). http://www.seda.gov.my/ Access on 22 May 2020
  52. Sovacool, B. K., & Drupady, I. M. (2011). Examining the small renewable energy power (SREP) program in Malaysia. Energy Policy, 39(11), 7244–7256. https://doi.org/10.1016/j.enpol.2011.08.045
  53. TNB (Tenaga Nasional Berhad). (2016). Kumpulan Wang Tenaga Boleh Baharu (KWTBB) / Renewable Energy Fund. https://www.tnb.com.my/kumpulan-wang-tenaga-boleh-baharu-kwtbb/ Access on 12 June 2020
  54. The New Strait Times. (2019). March. TNB and South Korean Partners to Tap Virtual Power Plant Benefits. https://www.nst.com.my/business/2019/03/468914/tnb-and-south-korean-partners-tap-virtual-power-plant-benefits Access on 12 June 2020
  55. The News Straits Times. (2019). SEDA to complete second biogas e-bidding exercise and small hydro power systems. https://www.nst.com.my/business/2019/07/506652/seda-complete-second-biogas-e-bidding-exercise-and-small-hydro-power-systems Access on 5 May 2020
  56. TNBX. (2019). Supply Agreement with Renewable Energy. https://www.tnbx.com.my/sare Access on 12 June 2020
  57. Trivino-Cabrera, A., Longo, M., & Foiadelli, F. (2017). Impact of Renewable Energy Sources in the Power Quality of the Italian Electric Grid. 2017 11th IEEE International Conference on Compatibility, Power Electronics and Power Engineering, CPE-POWERENG 2017, 576–581. https://doi.org/10.1109/CPE.2017.7915236
  58. UiTM Holding. (2020). Go Energy Sdn Bhd Collaborates With Universiti Teknologi Mara To Reduce Up To 74,000 Tonnes Carbon Footprint Through Green Campus Project. Go Energy Sdn Bhd Collaborates with Universiti Teknologi MARA (UiTM) To Reduce Up To 74,000 Tonnes Carbon Footprint Through Green Campus Project – UITM Holdings Access on 5 Jan 2020
  59. Ullah, S., Haidar, A. M. A., Hoole, P., Zen, H., & Ahfock, T. (2020). The current state of Distributed Renewable Generation , challenges of interconnection and opportunities for energy conversion based DC microgrids. Journal of Cleaner Production, 273, 122777. https://doi.org/10.1016/j.jclepro.2020.122777
  60. Weng, K., Wan, Y., & Kumar, R. (2016). A review on performance of artificial intelligence and conventional method in mitigating PV grid-tied related power quality events. Renewable and Sustainable Energy Reviews, 56, 334–346. https://doi.org/10.1016/j.rser.2015.11.064
  61. Yurnaidi, Z., & Rosalia, S. A. (2020). COVID-19 vs ASEAN Energy Sector: Oil & Gas – Recap of 2020. Energy Insight, 15, 1-2. https://doi.org/10.13140/RG.2.2.28907.98085
  62. Zerrahn, A., Schill, W. P., & Kemfert, C. (2018). On the economics of electrical storage for variable renewable energy sources. European Economic Review, 108, 259–279. https://doi.org/10.1016/j.euroecorev.2018.07.004
  63. Zhang, W., Maleki, A., & Rosen, M. A. (2019). A heuristic-based approach for optimizing a small independent solar and wind hybrid power scheme incorporating load forecasting. Journal of Cleaner Production, 241, 117920. https://doi.org/10.1016/j.jclepro.2019.117920

Last update:

  1. Flexible syngas-biogas-hydrogen fueling spark-ignition engine behaviors with optimized fuel compositions and control parameters

    Van Ga Bui, Thi Minh Tu Bui, Van Nam Tran, Zuohua Huang, Anh Tuan Hoang, Wieslaw Tarelko, Van Hung Bui, Xuan Mai Pham, Phuoc Quy Phong Nguyen. International Journal of Hydrogen Energy, 48 (18), 2023. doi: 10.1016/j.ijhydene.2022.09.133

  2. Potential of Explainable Artificial Intelligence in Advancing Renewable Energy: Challenges and Prospects

    Van Nhanh Nguyen, Wiesław Tarełko, Prabhakar Sharma, Ahmed Shabana El-Shafay, Wei-Hsin Chen, Phuoc Quy Phong Nguyen, Xuan Phuong Nguyen, Anh Tuan Hoang. Energy & Fuels, 38 (3), 2024. doi: 10.1021/acs.energyfuels.3c04343

  3. Desirability-based optimization of dual-fuel diesel engine using acetylene as an alternative fuel

    Van Giao Nguyen, Brijesh Dager, Ajay Chhillar, Prabhakar Sharma, Sameh M. Osman, Duc Trong Nguyen Le, Jerzy Kowalski, Thanh Hai Truong, Prem Shanker Yadav, Dao Nam Cao, Viet Dung Tran. Case Studies in Thermal Engineering, 59 , 2024. doi: 10.1016/j.csite.2024.104488

  4. Simulation and experimental study of refuse-derived fuel gasification in an updraft gasifier

    Thanh Xuan Nguyen-Thi, Thi Minh Tu Bui, Van Ga Bui. International Journal of Renewable Energy Development, 12 (3), 2023. doi: 10.14710/ijred.2023.53994

  5. Nanotechnology-based biodiesel: A comprehensive review on production, and utilization in diesel engine as a substitute of diesel fuel

    Thanh Tuan Le, Minh Ho Tran, Quang Chien Nguyen, Huu Cuong Le, Van Quy Nguyen, Dao Nam Cao, Prabhu Paramasivam. International Journal of Renewable Energy Development, 13 (3), 2024. doi: 10.61435/ijred.2024.60126

  6. Combination of solar with organic Rankine cycle as a potential solution for clean energy production

    Van Nhanh Nguyen, Nguyen Dang Khoa Pham, Xuan Quang Duong, Viet Dung Tran, Minh Tuan Pham, Sakthivel Rajamohan, Xuan Tuan Cao, Thanh Hai Truong. Sustainable Energy Technologies and Assessments, 57 , 2023. doi: 10.1016/j.seta.2023.103161

  7. Harnessing artificial intelligence for data-driven energy predictive analytics: A systematic survey towards enhancing sustainability

    Thanh Tuan Le, Jayabal Chandra Priya, Huu Cuong Le, Nguyen Viet Linh Le, Minh Thai Duong, Dao Nam Cao. International Journal of Renewable Energy Development, 13 (2), 2024. doi: 10.61435/ijred.2024.60119

Last update: 2024-11-20 04:53:32

No citation recorded.