Page 161 - GreenRE_Sustainable Real Estate Book

Industry Act, 2007 adding palm biodiesel to diesel fuel, “ Bank Negara is working with the industry to explore these
establishment of SEDA to promote the use of renewable options and innovative protection products that encourage
energy in power generation, National Land Public Financial institutions play alternative risk-sharing arrangements. One such approach
Transport Master Plan aimed at promoting the use of public is transition financing, aimed at supporting companies in
transportation while limiting private vehicle ownership and a crucial role in supporting reducing their GHG emissions. As of September 2022, 50
encouraging adoption of green technology and the Green out of 122 financial institutions have set specific climate
Technology Master Plan (2017–2030), which outlined efforts businesses’ efforts to reduce targets, such as net zero or no coal commitments, and
to reduce GHG emission intensity and support economic greenhouse gas emissions have dedicated functions and senior officers driving their
growth through green technology adoption. sustainability agenda. There are also more product offerings,
and transition to sustainable such as sustainability-linked loans, solar financing, and
Understanding the role of energy as the dominant source sustainable trade finance solutions, with an increasing
of GHG emissions, decarbonising the power sector is an operations by facilitating amount of financing committed by industry players.
important step which includes the phasing out of coal, Emerging facilities also include Green Sukuk or Green Bonds,
scaling renewables with storage technology, leveraging emission measurement, Sustainability and Responsible Investment (SRI) Bonds, green
Malaysia’s gas advantage to complement renewables as a tracking, and reporting. project/business loans, green mortgages, green consumer
transition fuel, investing in the grid, and scaling up energy finance and green vehicle loans.
efficiency in the areas of demand and management. This plan
is supported by Tenaga Nasional Berhad (TNB). shifts demand not only adoption of new technologies, but a The Bank Negara has introduced the RM1 billion Low Carbon
significant institutional, financial, and behavioral change. Transition Facility to match funds provided by financial
Another key proponent of GHG emission is the transport
sector in Malaysia, the second most GHG intensive sector Financing the Green Movement institutions to help SMEs embrace sustainable and low-
after electric power generation. Road vehicles produce 85.2% To achieve Malaysia’s net zero emissions target by 2050, carbon practices. Furthermore, the High Tech and Green
emissions, 59% of these emissions come from personal adaption initiatives would require investment of about RM350 Facility has allocated RM800 million to support SMEs and
vehicles. To achieve its carbon target, Malaysia must reach billion to RM450 billion. To meet this financing, financial innovative start-ups in strategic green and technological
40% overall public transport share by 2030, which is almost institutions play a crucial role in supporting businesses’ fields. Bank Negara is also exploring various pilot solutions,
double the current share of about 20%. including innovative protection products for floods and
efforts to reduce greenhouse gas emissions and transition to blended finance options to encourage innovation and scale
According to an assessment by the International Energy sustainable operations by facilitating emission measurement, up green financial solutions. These approaches can help
Agency, meeting the Paris Agreement’s goal of limiting global tracking, and reporting. New financing models, such as crowd in much-needed private funding for transition activities
temperature rise to 2° by 2050 will require nearly 95% of public-private partnerships and blended finance options, are and support Malaysia in achieving its climate goals.
global electricity to come from low-carbon sources, 70% of also essential to achieving Malaysia’s climate objectives.
new cars to be electric-powered, the entire building stock to Additionally, insurers can complement traditional risk transfer
be retrofitted, and CO intensity of the industrial sector to be solutions by helping customers strengthen their climate
2
80% lower than it is today. Meeting such extensive structural
resilience, which can also help reduce insurance risk.

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