Sabah has to transition towards cleaner, more sustainable energy solutions

Borneo Post

24-04-2025

Arshad Mohamed Ismail
KOTA KINABALU (Apr 24): Sabah needs to move towards cleaner, more sustainable energy solutions.
Malaysian Rating Corporation Berhad Group Chief Executive Officer Arshad Mohamed Ismail in his special address said that Sabah has initiated an ambitious yet necessary journey towards energy security and affordability as well as environmental sustainability after the launch of the Sabah Energy Roadmap and Master Plan 2040 (SE-RAMP 2040).
'Blessed with abundant natural resources, Sabah has long been a key contributor to Malaysia's economy. However, the State's energy faces significant challenges that threaten its long-term sustainability,' he said at the Sabah Renewable Energy Conference (SAREC 2025) held at the Shangri-La Tanjung Aru Resort on Thursday.
Arshad elaborated that Sabah's electricity supply remains constrained, as reflected in the State's lower reserve margin compared to that of Peninsular Malaysia, underscoring the urgent need to expand generation capacity.
'The situation is further compounded by the State's heavy reliance on fossil fuels, with 86 percent of power generation currently dependent on natural gas – a resource that is finite in the long term.
Despite having an estimated 101GW of renewable energy potential, particularly in hydro, solar and biomass, only 7.3 percent of Sabah's current energy mix is derived from renewable sources. This highlights the need for the State to transition towards cleaner, more sustainable energy solutions,' he said.
'This highlights the need for the State to move towards cleaner, more sustainable energy solutions,' he said.
He also said that the launch of the Sabah Energy Roadmap and Master Plan 2040 (SE-RAMP 2040) marks a bold vision to achieve reliable, accessible, affordable and sustainable energy by 2040.
'With ambitious targets – 50 percent renewable installed capacity by 2035, universal rural electrification by 2030, and carbon neutrality by 2050 – achieving these goals demands substantial investment and robust public-private partnerships,' he reminded.
Arshad also said that for Sabah to attract investors and drive the growth of its renewable energy sector, it must establish three key enablers.
'First, regulatory clarity is crucial – investors seek a stable and predictable policy environment. In this regard, the devolution of electricity and energy regulatory powers from the federal government to the Energy Commission of Sabah (ECOS) marks a significant step forward. This enables Sabah to take greater ownership of its energy resources and craft regulations that are better tailored to its specific needs and development goals.'
'Second, infrastructure readiness plays a crucial role. The expansion of transmission lines, particularly the 275kV Southern Link, will improve grid stability and enable higher renewable energy penetration.
'Lastly, innovative financial instruments such as green sukuk, ESG-linked loans, and blended finance models can offer alternative funding mechanisms.
Sabah's vast solar, hydro and bioenergy resources make it an ideal destination for renewable energy investments. By aligning investment opportunities with national sustainability goals, Sabah can firmly establish itself as a leader in the green economy,' he said.