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PETRA is intensifying efforts to attract FDI in the green technology and circular economy sectors, with the aim to create high-skilled jobs and advance technology transfer to the local workforce.
The Ministry of Energy Transition and Water Transformation (PETRA) has outlined its strategic plans to attract foreign direct investment (FDI) in the green technology and circular economy sectors, focusing on energy and water.
The announcement was made by Dato’ Fadillah Yusof, Deputy Prime Minister and PETRA minister, during a parliamentary session on 7 August 2025.
Addressing an oral question from Dato’ Haji Abdul Khalib bin Abdullah (Member of Parliament for Rompin), Dato’ Fadillah emphasised that the government’s approach centres on strengthening existing United Nations initiatives. The goal is to offer certainty, incentives, and a wider range of green electricity supply options, making Malaysia’s industrial value chain more appealing to investors.
Key ongoing efforts include:
- Large-scale solar programme: This remains a core solar generation initiative designed to attract investments in the renewable energy (tenaga boleh baharu, or TBB) field, with the added benefit of minimal electricity tariff increases for consumers.
- Low carbon energy generation programme: This initiative introduces a stimulating tariff mechanism to promote investment in non-solar sources.
- Corporate renewable energy supply scheme (CRESS): Updates to this programme will enable companies investing in Malaysia to procure green electricity directly from selected TBB generators, helping them meet environmental, social, and governance (ESG) commitments.
In addition, the government is preparing tax incentives such as the Green Investment Tax Allowance (GITA) and Green Income Tax Exemption (GITE) to further encourage investments in renewable energy and green technologies.
Together, these initiatives are projected to attract investment worth approximately RM637bn and create around 310,000 direct jobs by 2050, compared with 2022 figures.
To ensure the creation of high-skilled employment and effective technology transfer, PETRA mandates that local ownership equity in all TBB projects be at least 51%. This applies across programmes including the large-scale solar, incentive tariff, CRESS, and Community Renewable Energy Aggregation Mechanism (CREAM).
This policy aims to enable the transfer of skills and specialised technology in TBB, benefiting local workers and businesses.
The areas of focus for workforce development and technology transfer include:
- Management and implementation: Engineering, procurement, construction, and commissioning of TBB projects will provide high-skilled jobs for locals in design, project management, as well as technical, legal, and commercial roles.
- Manufacturing and installation: Installation of components such as solar panels, boilers, vehicle charging systems, and energy storage will enhance local content development.
- Technology transfer: Adoption of existing and latest circular economy technologies including CCUS, waste recovery, and waste-to-energy (WtE) will develop local skills in value chain design and control of this field.
Lead image / Dato’ Fadillah Yusof Facebook
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