Syed Ahmad Syed Mustafa Head GTFS Strategic Planning

Syed Ahmad Syed Mustafa Head, GTFS Strategic Planning, Alliance & Business Development Division May 2012 1

TABLE OF CONTENTS BIOMASS IN MALAYSIA • MUNICIPAL SOLID WASTE • OIL PALM BIOMASS • BIOMASS APPLICATIONS GREEN TECHNOLOGY FINANCING SCHEME (GTFS) • WHAT IS GTFS? • GTFS TERMS • WHO SHOULD APPLY? • THE PROCESS • GTFS STATUS GREENTECH MALAYSIA Q&A 2

BIOMASS IN MALAYSIA Agricultural residues • Generate>85 million tonnes / year (94% palm oil, 4% wood industry & 1% rice husk and baggase Source: UPM Municipal solid waste • Generate >25, 000 tonnes / day (48% organic / food waste, 24% paper, 9% rubber & plastic, 6% metal, 5% wood and 8% glass & textile Source: JPSPN

MUNICIPAL SOLID WASTES Current state of affairs o 25, 000 tons/day waste generated in Peninsular Malaysia in 2012 o. Only an estimated of 5% recycled. o. Landfills are the only means of disposal. o. Life span of landfill 510 years Source: JPSPN Reduce dependence on landfills • lack of areas for new landfills especially within major conurbation and corridors • landfills increase methane and GHG emissions causing climate change • negative public perception on landfills New sustainable SWM technologies are required to address environmental issues. Emerging technologies are available and looks promising but viability needs to be verified.

Oil Palm Biomass • Palm oil industry is 4 th largest contributor to GNI (8% or RM 50 million of GNI) • Malaysia is the 2 nd largest producer in the world and largest exporter for CPO • Produce 80 mil tonnes solid biomass/ yr and 60 mil tonnes of POME in 2010 • In 2020 solid biomass and POME volume expected to increase to 85 -110 mil tonnes/ yr and 70 -110 mil tonnes / yr respectively

OIL PALM BIOMASS 22%-24% EFB 21% CPO 1 MT of FFB 6%CPKO 12%-13% Mesocarp Fibre Fronds Biomass 5%-6% Shell Trunks 65%-70% POME 7

BIOMASS APPLICATIONS ENERGY BIODEGRABALES CONSTRUCTION MATERIALS COMPOST 8

WHAT IS GTFS? 3 -YEAR PER (2010 -2 IOD 012) Soft loan scheme initiated by the government to facilitate the improvement of supply and utilization of Green Technology by providing easier access to financing. RM ION T A C LLO 1. 5 b A 9

LET IT BE GREEN! THE GREEN PROJECTS CRITERIA Minimize degradation of environment; Zero or low green house gas emission; Safe for use and promotes healthy and improved environment for inhabitants Conserve the use of energy and natural resources; and Promote the use of renewable energy resources. 10

GTFS TERMS i) CRITERIA PRODUCER Maximum: RM 50 Million per company Up to 15 years Legally registered Malaysian – owned companies (at least 51%) in all economic sectors USER Maximum: RM 10 Million per company Up to 10 years Legally registered Malaysian – owned companies (at least 70%) in all economic sectors 11

GTFS TERMS ii) OTHERS Financing will be provided by all commercial & Islamic banks, Development Finance Institutions (DFIs) 2% p. a. of government’s subsidy 60% government guarantee of financing approved 0. 5% p. a. guarantee fee to the government Projects are to be located in Malaysia Refinancing is not allowed. 12

KEY PLAYERS BANK NEGARA MALAYSIA • COORDINATING THE SCHEME GREENTECH MALAYSIA • ISSUANCE OF PROJECT CERTIFICATE CREDIT GUARANTEE CORPORATION • PROVIDING GUARANTEE ON THE FINANCING AMOUNT PARTICIPATING FINANCIAL INSTITUTIONS • FINANCING PROVIDER 13

WHO SHOULD APPLY? ENERGY SECTOR • ENERGY SUPPLY SECTOR • ENERGY UTILIZATION SECTOR BULDING • CONSTRUCTION, MANAGEMENT, MAINTENANCE AND DEMOLITION WATER & WASTE MANAGEMENT SECTOR • MANAGEMENT AND UTILIZATION OF WATER RESOURCES • WASTE WATER TREATMENT, SOLID WASTE AND SANITARY LANDFILL TRANSPORTATION • TRANSPORTATION INFRASTRUCTURE AND VEHICLE • PUBLIC ROAD TRANSPORT 14

THE PROCESSE • PROJECT CERTIFICATION STAGE 1 STAGE 2 STAGE 3 • FINANCING & GUARANTEE • PROJECT OUTCOME /MONITORING 15

STAGE 1: PROJECT CERTIFICATION APPLICATION (PROJECT PROPOSAL) - Online: www. gtfs. my - Hard Copy Submission Technical Evaluation & Business Review Presentation by Green. Tech Malaysia Technical Evaluation Team TECHNICAL PROJECT APPROVAL BY GTFS COMMITTEE (GC) *If rejected, applicants will be notified GREENTECH MALAYSIA WILL ISSUE PROJECT APPROVAL CERTIFICATE Project Certificate 16

STAGE 2: FINANCING & GUARANTEE FINANCING APPLICATION LOAN APPROVAL BY PFI • Loan Application Processed by PFIs • Additional supporting documents are required • Approved/ Applicant will be notified if not approved LOAN AGREEMENT & DOCUMENTATION LETTER OF OFFER TO BORROWER FROM PFI GOVERNMENT GUARANTEE APPROVED BY CREDIT GUARANTEE GROUP (CGC) 17

STAGE 3: PROJECT OUTCOME/MONITORING PROJECT MONITORING & VERIFICATION • Submission of monthly Project Progress Report to Green. Tech Malaysia during project implementation • Submission of Project Outcome Report every six months to Green. Tech Malaysia upon commissioning PROJECT IMPACT • Submission of Project Impact Study upon completion of Project Monitoring and Verification 18

GTFS STATUS 19

201 APPLICATION PROCESSED AMOUNTING TO RM 3. 4 BILLION IN GREEN COSTS 5% 4% 27% 63% ENERGY WASTE & WATER BUILDING TRANSPORTATION 20

178 PROJECTS CERTIFIED AMOUNTING TO RM 3. 3 BILLION IN GREEN COSTS 4% 4% ENERGY 28% WATER & WASTE BUILDING 63% TRANSPORTATION 21

43 PROJECTS SECURED FINANCING AMOUNTING TO RM 659. 1 MILLION AND RM 188. 2 MILLION DISBURSED AMT DISBURSED (RM million) AMT APPROVED (RM million) NO. OF PROJECTS TRANSPORTATION BUILDING WATER & WASTE ENERGY 0 7 2 0 8, 8 1 58, 6 207, 8 15 129, 6 25 435, 6 22

37 GTFS CERTIFIED BIOMASS PROJECTS AMOUNTING TO RM 855 MILLION IN GREEN COST FERTILIZER 8% DRY FIBER 5% BIOFUEL 14% PELLETS 14% PAPER 8% POWER PLANT 51% 23

11 PROJECTS SECURED FINANCING AMOUNTING TO RM 307 MILLION FERTILIZER, 1 BIOFUEL& DRY FIBER, 01 PELLETS, PAPER, 1 POWER PLANT, 8 25

CRITICAL SUCCESS FACTORS CAPITAL OFFTAKE MANAGEMENT PROVEN TECHNOLOGY BUSINESS SENSE FEEDSTOCK SUPPLY 27

Criteria: Biogas power plant (RE ) Biogas Plant Category: Producer Project Build & operate a biogas power plant at Palm Oil Mill for internal use. Capacity Total capacity : 1 MW Location Sandakan, Sabah Project Cost RM 18. 5 million Project Objectives C for existing boiler t Surplus gas to be used a 0 fuel 00 displaced. so that biomass can 3, be Technolog y C Stirred anaerobic digestion at thermophillic conditions with monitoring and control systems that can capture as much gas possible. Project outcome Reduction of GHG emission about 53, 000 t. CO 2 eq/yr yr / O 2 -5 R E 28

Paper From. Waste (Oil Palm EFB) Criteria: EFB based paper Category: Producer Project Paper Mill derived from EFB Location Pekan, Pahang Capacity 60, 000 mt paper p. a. utilising 350, 000 mt EFB Project Cost RM 93. 4 million Project Objectives To Utilize Environmentally Friendly yr Processes / 2 to Optimize Malaysia Agro-waste O and Create a C t Sustainable Product (paper 65 using EFB )with 1 , Beneficial Environmental and Fiscal Impact. 09 -1 R E Technology Steam C explosion technology to produce the pulp such as Fiber Extraction, Pulping & Paper making. Project outcome Reduction of GHG emission about 109, 165 t. CO 2 -eq/yr 29

Criteria: Green pellets & flakes Pellet Production Category: Producer Project Green Pelleting Plant Location Klang, Selangor Capacity 7, 200 Mt/month (30% for domestic market) Green pellets and flakes at Calorific Value of 19 MJ/kg Project Cost RM 42. 1 million Project Objectives yr / O 2 To produce palm tree-based pellets; Bio Green C t Flakes(Palm Kennel 4 Pellets(BGP) and Green 5 0 , Shell) 0 6 R E The process C is locally invented with German and Japanese technology application such as pellet press machine. The process includes Technology demoisturization, vibrator separation, blending, drying exchange, fumigations, homogenization, packing in standard bags(Jumbo bag or loose). Project outcome Reduction of GHG emission about 60, 054 t. CO 2 -eq/yr 30

Criteria: Bio-compost Composting Category: Producer Project Nutrient Recycling Strategy via Decomposition of Palm Oil Mill Green Waste Location Gua Musang, Kelantan Capacity Compost plant capacity : • incoming EFB 50, 544 metric ton/year • compost production 27, 048 metric ton/year yr Plant area requirement is 56. 222/acres Project Cost RM 8. 4 million O C t 594 , Project Objectives 8 To convert EFB (50, 544 metric ton/year) into 2 R bio-organic E fertilizer (27, 048 metric ton/year) C by using a compost plant. Technology 1. Composting technology and addition of beneficial microbes. 2. Extraction of humic acid from composting leachate. Project outcome Reduction of GHG emission about 28, 593. 95 t. CO 2 -eq/year 31

Dry Fiber Criteria: EFB dry fiber Category: Producer Projects Name Manufacturing of Long Dried Palm Fibre (LDPF) Location Taiping, Perak Capacity 7, 920 tonnes annually of long dried palm fibre (15 -20 cm in length) from about 31, 680 tonnes of EFB. Project Cost RM 2. 7 million Project Objectives Conversion of empty fruit bunch (EFB) into long dried fibre through hammering, screening and drying. . Technology Simple process of hammering, screening and drying producing long dried fibre. Project outcome Reduction of GHG emission about 3, 910 t. CO 2 eq/year t. C 0 1 , 9 yr / O 2 -3 R E C 32

ABOUT GREENTECH MALAYSIA Transformation INCEPTION: 12 MAY 1998 FOCUS Technology and Research Centre in the Energy Sector focussing on EE and RE. CHANGED NAME: 7 APRIL 2010 MANDATE Implementation Agency for development of Green Technology 33

ENERGY AUDIT GREEN TOWNSHIP CLEAN DEVELOPMENT MECHANISM GREEN TECHNOLOGY FINANCING SCHEME COMPETENCY DEVELOPMENT CENTRE IGEM EV ROADMAP GREEN TECHNOLOGY ROADMAP CENTRE OF EXCELLENCE GREEN LABEL GREEN DIRECTORY SMART PARTNERSHIPS Activities… 34 34

Q&A SESSION 35

Malaysian Green Technology Corporation (462237 -T) No. 2, Jalan 9/10, Persiaran Usahawan, Seksyen 943650 Bandar Baru Bangi, Selangor Darul Ehsan Website: www. gtfs. my Hotline: 1 -800 -88 -4837 36