07/12/2011 (Business Times) - The government is open to raising quotas to generate renewable power (RE) if consumers are willing to pay another 1 per cent RE levy on top of the current 1 per cent in the electricity bills.

Starting this month, consumers in Peninsular Malaysia and Sabah, whose electricity bills exceed RM77, will start paying the 1 per cent levy to subsidise RE producers.

Energy, Green Technology and Water Ministry secretary-general Datuk Loo Took Gee estimates Sustainable Energy Development Authority Malaysia (Seda) to collect up to RM250 million in levy by the end of 2012.

Due to limited funds, the feed-in tariff (FiT) quota allocation for RE producers is awarded on a first-come, first-serve basis. This prompted a rush in online applications to Seda.

Since December 1 2011, applications for the FiT allocation under the categories of biomass and solar photovoltaic (PV) renewable energy projects were fully taken up.

"There's so much interest in biomass and solar PV," said Seda chief operating officer Ali Askar Sher Mohamad.

Asked if the government may raise the quotas and allow for more RE producers to supply to the national grid, Loo said: "It all depends on the funding. If (heavy energy) consumers (in Peninsular Malaysia and Sabah) are willing to pay an addition 1 per cent (to the current 1 per cent RE levy on their electricity bills), we're open to raising the quotas."

Loo and Ali were speaking to Business Times on the sidelines of the Solar Symposium 2011 held here yesterday.

When contacted, Plantation Industries and Commodities Minister Tan Sri Bernard Dompok said international leaders are aware of the achievements and continuous efforts of Malaysian oil palm industry in contributing towards climate change mitigation initiatives.

In recognising the importance of greenhouse gas reduction and climate change mitigation, the Malaysian Palm Oil Board carried out a life cycle assessment of palm oil and palm bio-diesel production.

Dompok said the study, which had been reviewed by an international independent expert panel and published in peer reviewed journals, found that one tonne of refined palm oil entails emission of about 1.1 tonne of carbon dioxide equivalent of GHG.

It is lower than the 1.7 tonnes of emission for soyabean oil and 1.35 tonnes for rapeseed oil.

"The GHG emission of one tonne of palm oil is comparable if not better than those of other competing vegetable oils such as soyabean oil and rapeseed oil," he said.

Nevertheless, Dompok said the industry is striving to minimise emsissions by trapping methane from palm oil mill effluent and converting it to renewable energy for supply to the national grid.