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NATIONAL BIOMASS STRATEGY 2020:CAPTURING THE BIOMASS OPPORTUNITY
“Importance of Sustainable Feedstock and Product Strategy”
Copyright 2012-2015 by Agensi Inovasi Malaysia. All Rights Reserved.
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1
This document was prepared by Agensi Inovasi Malaysia (AIM) with
the purpose of providing information about the National Biomass
Policies and Strategies in Malaysia for the Information Event in
Frankfurt, Germany on 15 September 2015.
The possible future development of projects illustrated in this
presentation are subject to change at any time for any reason without
notice. This presentation is for discussion purposes only and should
be viewed solely in conjunction with the oral briefing provided by AIM.
Neither this presentation, nor any of its contents may be used for any
other purpose without the prior written consent of AIM.
DISCLAIMER
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Agensi Inovasi Malaysia (AIM), Malaysia’s National Innovation Agency under Prime Minister’s
Department is a statutory body created to jump start wealth creation through knowledge, technology and
innovation to stimulate and develop the innovation eco-system in Malaysia. We lay down the foundation of
innovation that inspire and produce a new generation of innovative entrepreneurs.
ABOUT AGENSI INOVASI MALAYSIA (AIM)
Copyright 2012-2015 by Agensi Inovasi Malaysia. All Rights Reserved.
Under the Agensi Inovasi Malaysia
Act 2010, AIM is administered by a
Governance Council (GC) that
gives inputs and go-ahead for AIM’s
direction, policies and initiatives.
There are 17 members in the GC,
led by the Malaysia’s Prime Minister
as Chairman. Members of the
Council are appointed by the Prime
Minister, with each member serving
the Council for a term not exceeding
three years. The reappointment of a
member is limited to three
consecutive terms.
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CONTENT
3
1MBAS Unit - NBS 2020 Delivery Unit
Biomass Availability and Malaysia’s Potential
Update and Progress
Context and Objectives: Collaborative and inclusive effort to define the National Biomass Strategy 2020
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NATIONAL BIOMASS STRATEGY 2020 LAUNCHED IN 2011:
A NATIONAL STRATEGY ON BIOMASS UTILISATION
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OBJECTIVE OF THE NBS2020
5
Create a national strategy on how to use biomass
for portfolio of high-value downstream activities
(e.g., bioenergy, biofuel, biochemical)
Primary objective: maximize sustainable GNI
impact from biomass in the 2020 time frame
Other considerations
▪ Downstream value creation
▪ High value job creation
▪ “Indigenous technology” creation within
Malaysia (direct and indirect value creation)
▪ Sustainability impact and emissions impact
▪ Using Biomass as leverage to form smart
partnerships with downstream companies and not
selling it as commodity so that biomass owners
can start getting into higher-value downstream
industries
Strategy Design principles
▪ Private Sector Led
▪ Portfolio Approach for Downstream Activities
and Objective industry facilitation
▪ No Specific Technology Recommendations
Malaysia’s Opportunity to Capture
RM30 billion additional GNI
impact
~66,000 new jobs
RM25 billion investment
opportunities
~12% CO2e abatement
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Stakeholder
involvement
Advisory
panel
Stakeholder
labs
Survey with
~170
plantations
and ~70 mills
6
Inclusive stakeholder efforts on the development of National Biomass Strategy
2020: 300+ interactions (development work in 2010 and launched in 2011)
INDUSTRY – GOVT – ACADEMIA COLLABORATION
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77
0
5
10
15
20
25
30
35
202020152011
Additional 20% biomass shift towards portfolio of Higher Value
Uses by 2020 (inclusiveness)
Energy
Wood
products
1%
1%
3%
1%
4%
Use of biomass by type of end-product
6%
4%
9%
3%
9%
Share of total biomass available
in given year
Fuels
Pellets
Biobased
chemicals
Business as usual
Biomass used
Million tonnes, dry weight
11% 31%Total:
Pellets enable profitable
mobilization today,
and act as flexible
buffer once biobased
chemicals become
commercially available
Biomass to wealth
~14 bln
~8 bln
~9bln
~3bln
~2bln
GNI
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The National Biomass Strategy looked into 4 Key Aspects of Malaysia’s
Potential to Develop a Sustainable Biomass Industry
iAvailability, Cost, Location of
Biomass in Malaysia
iiTechnology Available to Process
Biomass (Maturity)
iii Portfolio of Uses for Biomass
iv Malaysia’s Biomass Opportunities2011:
Oil Palm Biomass
2013:
Expanded Scope to
Cover Forestry and
Dedicated Crops As
Source of Biomass
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Context and Objectives
1MBAS: NBS 2020 Delivery Unit –Government’s Commitment to ensure execution of Strategy (Cross-Agency Collaboration)
Biomass Availability and Malaysia’s Potential
Update and Progress
CONTENT
c
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BIOMASS UTILISATION CUTS ACCROSS SECTORS SO ITS IMPORTANT
TO HAVE CENTRAL AND OBJECTIVE FACILITATION
10
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2011 2012 2013 2014 2015 2020
11
The National Biomass Strategy 2020: Chronology of Events
SOURCE: Press articles, BIO Pacific Rim pictures
“the NBS would pave the way for the growth of new high
value industries…including in bio-based chemicals and bio-
energy”
- Prime Minister Datuk Seri Najib Tun Razak, at the launch
of the strategy at the opening of BIO Pacific Rim 2011
Prime Minister launched
the 1MBAS Unit (Cross
Agency Task Force) to
accelerate and strengthen
execution NBS 2020 in
March 2012
NBS V1.0
Palm Oil Biomass
NBS V2.0
Expanded Scope
Forestry and
Dedicated Crops
Awareness State Buy-In Facilitation
Commercialisation
Create Multiple Biomass
Mobilization Models to
move industry and solve
Commercialisation Issues
By 2020
• RM30b additional GNI
• 60,000 jobs
• 12 reduction CO2
• RM 25b in Investments
Sabah and Sarawak
Biomass Strategy
(Co-Development with
Sabah and Sarawak
State Govt)
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1MBAS team has been engaging local and international stakeholders
to facilitate the successful execution of the NBS2020
12
Since launch, AIM’s NBS2020 team has amongst others:
• Engaged with >90 mill owners in Sabah State to resolve the
Biomass Mobilization challenges, together with the Sabah
Ministry of Industrial Development, POIC Sabah, MIDA, MPOB
and PEMANDU
• Engaged and collaborated with Sarawak based industry, the
Sarawak State Government, State Planning Unit and its
agencies to develop a biomass cluster in Sarawak
• Organized visits for Malaysian biomass owners to downstream
users of biomass
• Engaged with international pellets, bio-fuels and Bio
Chemicals off-takers to work with Malaysian biomass owners
• Presented the Nation’s National Biomass Strategy at
International conferences throughout Asia, Europe and
Americas
• Facilitated feasibility studies for potential JV parties to invest in
Malaysia
• Established the Pellet Association Malaysia to help industry
1MBAS worked closely with stakeholders in the Sarawak & Sabah Govts. and industry for two
years, gained real traction to create high-value biomass clusters to benefit both States
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NBS2020 positions Malaysia as the SEA Biomass Processing
Hub in minds of biomass owners and (Global) biomass users
13
2011 today2012 2013 2014
Strategy advocating
Milestones
Industry Interest/engage
Intern’l
Local
Launch NBS2020
Launch NBS2020 v2.0
Launch 1MBAS initiative
Lahad DatuJV Cluster
SEA first 2GEthanol pilot plant
P.A.M. established
Bintulu 2G ethanol project
100,000 t/month pellet order received
World Bio Markets, Europe
BIO Pacific Rim, USA
Biomass pellets, Korea
JV Cluster workshop, KK
Downstream pellet engagements, Korea
Palmex, Sandakan
BioBased Chem Asia, BKK
BIO Pacific Rim, KL
Palmex, Tawau
NBS2020labs
To meet the targets of the NBS 2020, the role to create awareness, engage and
‘convene’ all stakeholders is critical and must be continuous
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Biomass Availability and Malaysia’s Potential:30% of Biomass shifted towards Higher Value Activities could create incremental GNI of RM ~30 billion and ~66,000 new jobs by 2020
Update and Progress
Context and Objectives
1MBAS – NBS 2020 Delivery Unit
CONTENT
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MALAYSIA’S OIL PALM TOTAL PLANTED AREA (2013)
0.0
Perlis
Penang
0.0
0.1
Kedah
Malacca
0.1
Selangor 0.1
Kelantan 0.1
Terengganu 0.2
Negeri Sembilan 0.2
Perak 0.4
Pahang 0.7
Johor 0.7
Sarawak 1.2
Sabah 1.5
Mature Immature
Planted palm oil area as of Dec 2013
Million hectares
SOURCE: MPOB; Poyry
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SOURCE: MPOB; Interviews
1 Based on 2010 FFB yield of 18 MT/ha, 4.85m ha planted, 4% replanted area per year and company specific information
Malaysia generates sufficient amounts of dry palm biomass per year
and availability subjected to biomass types and mobilisation cost
Solid
(dry weight)
POME
Annual Availability
Site of
production
Per ha
(tonnes)
National total
(m tonnes)1DescriptionBiomass Type
MillLiquid by-product from steriliza-
tion and milling process of FFB
Shells
(PKS)
MillRemains after palm kernel oil
extraction
MillRemains after oil extraction
from mesocarp
MillRemains after removal of palm
fruitsEFB
Fiber
(MF)
Fronds PlantationLeaves of oil palm tree
Trunks
12.2
0.8
1.4
1.4
9.6
3.0Plantation
59.3
4.1
6.9
6.7
46.4
14.4Tree trunk available at end of
plantation lifecycle
Liquid
(wet weight)
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PKS Fiber EFBFronds Trunks
Biomass types (USD per tonne dry weight)
A detailed costing methodology has been developed to illustrate
how biomass can be mobilized in a Sustainable Way
5 - 21 15 0 0 0Harvesting
&
collection
2
19(chipping)
26(chipping)
031(shredding +
compacting)
5(compact
ing)
Pre-
processing3
29(fertilizer),
no application cost
11(fertilizer)
5(appli-
cation)
+ 24(fertilizer)
3(appli-
cation)
+ 41(2010 price)
13(2010 price)
Substitu-
tion1
9 - 80 8 - 81 0 - 113 0 - 40 0 - 97Transport-
ation4
SOURCE:, M. Islam et al.; K. Haron et al.; H. Kalid et al;. Lazaro A. et al.; ICIS; MARDI; MPOB; Field visit; Interviews
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25 m tonnes of biomass can be mobilized in ports at USD 80 and
below using fully-loaded cost methodology
Cost of biomass in 2010
USD per tonne (dry weight)
Biomass available
Million tonnes
100
0
55
160
1510
20
5025 30 35
140
120
0
40
45
80
60
5 20 40
• 25 m tonnes below USD
80 at fully-loaded cost
• Costs can be significantly
lower e.g. if processing
plants are co-located with
palm oil mill clusters
Pre-process-
ing cost
3
Substitution,
harvesting
and collect-
ion cost
1
2
Transport
cost4
13 m tonnes below
USD 60 at fully-
loaded cost
SOURCE:, NPOB, AIM analysis, Academic papers, plantation interviews
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25 m tonnes of biomass could be mobilised across Malaysia
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20
Biobased Chemicals should offer highest value-add in the future
24-78
1,100-3,515
430-1,100
380-1,250
15-150x
215-390
Revenue generated per tonne of lignocellulosic biomass input (dry weight)
RM
Upper range
Lower rangeFertilizer
Bioenergy
Biofuels
Biobased-
chemicals
Existing revenue per
tonne today
Wood industry / Pellets
*Based on figures 2010-2011
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Wide range of downstream uses for ligno-cellulosic biomass: 2G BioFuels
have reached commercial scale, 2G BioChemicals between 2016-2020
SOURCE: MOSTI R&D for Biomass 2010, Status of 2nd Generation Biofuels Demonstration Facilities in June 2010, MY-Basic Workshop February
2011, Expert interviews
Today
2014
FertilizerWood
industryOtherBioenergyPellets
2015
2020
Ligno-cellulosic
pathway
Biobased-
chemicals
In 2013, Lignocellulosic
biofuels already being
commercialized
(accelerated pace)
Biofuels
Beta Renewables’
cellulosic ethanol facility
in Crescentino, Italy is
the first plant in the world
to produce commercial
quantities of advanced
biofuels.
40-60K/annum capacity
(fermentation based)
October 2013 Sept 2014
Poet-DSM became the
World’s 2nd Cellulosic
Ethanol Plant using
straws as feedstock
located in the US
70K/annum capacity
(fermentation based)
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Portfolio approach to downstream allows integration building a
sustainable business model
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0
200
400
600
800
1,000
0 5 10 15 20 25 30 35 40
Mobilised biomass (%)
Incremental GNI impact of ~RM 30 billion
SOURCE: EPU, Future of Industrial Biorefineries, 2010, FiT Handbook, NKEA EPP5, Ullmanns and Kirk Othmer, SRI, Lactic acid and PEP Yearbook
2010, Journal of Palm Research 1999,, Platt's data strip, SRI, Press search, Expert interview
Business as usual
20202015
Biomass to
wealth scenario
2015
2020
bn RM GNI impact
6-7
1
Today
35-39
Cumulative
RM 28-35 bn
investment
Cumulative
RM 8-10 bn
investment
Average revenue per tonne of biomass
RM
2-3
11-12
▪ ~2% additional GNI impact
▪ ~66,000 new jobs
▪ ~12% CO2e abatement
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On going study with state government of Sarawak to developing
“Sarawak Biomass Industry Development Action Plan”
24
Source: Poyry Analysis, 2015
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Brooke Renewables 2G bioethanol plant in Sarawak to catalyst the
proposed Sarawak Biomass Hub Project
Bio-Ethanol
Refinery 1
Bio-Ethanol
Refinery 2 cum
BioChemical Plant
Enzyme Plant
Biomass Waste
Pelletisation
Facilities
Phase 2
Energy Crops
Agro Plantations
Concept Art
Brooke Renewables
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Source: Poyry Analysis, 2015
On going study with state government of Sabah to developing
“Sabah Biomass Industry Development Action Plan”
Sabah land cover map
• Largest palm oil plantation
area in Malaysia
• Palm oil plantations: 1.5
million ha
• Timber production: 1.1
million mᶟ
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The Sabah biomass industry offers several development opportunities
over time, and becoming a global bio-refinery hub
27
Sabah Biomass Strategy
Development could help Sabah capture:
~RM3.2 billion annual revenue
~25,384 new Green jobs
~RM13.5 billion in investment opportunities
by 2032
Sabah as a Global Bio-refinery Hub
CLUSTERS BASED ON BIOMASS AVAILABILITY AND
EXISTING INFRASTRUCTURE
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28
Biomass Availability and Malaysia’s Potential
Context and Objectives
Update and Progress: Private Industries taking the lead in Sarawak and Sabah on Biomass Initiatives towards Higher Value Added Activities
1MBAS: NBS 2020 Delivery Unit
CONTENT
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29
Update and Progress: Private Industries taking the lead in Sarawak and Sabah on Biomass Initiatives towards Higher Value Added Activities
NBS2020 UPDATE
a. Biomass to Energy
a. Liquid Biofuels (Bioethanol)
a. Biochemical
a. Biomass Cluster Development- IPP- Steam- Waste
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Pellets: Growing Demand for Biomass pellets in Korea, Japan and
China, mainly driven by co-firing for carbon reduction
SOURCE: EnerOne report, Biomassmagazine.com, Poyry,
Team analysis
• South Korea has amended their laws to
allow the import of EFB pellets from 22
July 2014 (Pellet demand will start at 2%
co-firing rate in 2015 and would be 1.6
million tonnes) – Malaysia’s total
capacity as of today less than 400k
per annum combines
• Expected imports of biomass pellets in
Korea beyond alone to reach 5 million
tonnes per year, due to Koreas RPS
mandate going forward.
• Japan is expected to increase
importation of energy chips and wood
pellets, due to its FiT starting 2016 to
cater for all new Biomass Power Plants
(Ration 70% Coal and 30% Biomass) –
minimum size per facility of 100MW –
Demand of pellets to supplement
expected to be 5m tonnes In 2016
• If China were to replace 1% of its coal
consumption with pellets, it would require
40m tonnes per year. China is already
importing wood pellets
Import demand in Asia expected to reach ~20mln tons by 2020
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Biomass mobilization for high value Renewable Energy pellets is the key to
unlocking NBS2020, and is taking off through our facilitation with local
producers and Korean off-takers
31
Biomass used
Million tonnes, dry weight
3111% 31%Total:
0
5
10
15
20
25
30
35
202020152011
3%
9%
Pellets enable
profitable
mobilization and
volume today, and
act as flexible bufferonce liquid biofuels and
biobased chemicals
become commercially
available
• Established Pellet Association of Malaysia, >10 members
• Detik Aturan: Home grown pellet producer received contract on 25th Jan ‘14 from Korea for 100,000 Tonnes/month (1.2 million tonnes/annum)
• Detik’s capacity was 3,000 Tonnes/month, now ramping and going from RM20m to RM500m per year
Confirmed plants
Potential plants
• Worked with Korea govt. and utilities to accept EFB pellets: Law amended 20 Dec ‘13
New Sarawak Partnership facilitated
by AIM for 5 Pellet Plants with a
combined facility of 30,000 t.p.m.
signed in August 2014
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Malaysian industry is embracing initiatives under the National
Biomass Strategy 2020
32
“Without the National Biomass Strategy,
we wouldn’t have ventured into all these
downstream activities today”
Joseph Lim, CEO GGS
“AIM’s continuous support to this industry
will accelerate the growth of pellet industry
in Malaysia”
Khairil Annuar Khalid , MD Detik Aturan
GGS and China based Chinalight signed MoUs on
9 October 2013 for pellet off take to China
Detik Aturan and Korean BC21 signed MoUs on 9
October 2013 for pellet off take to Korea
Detik Aturan and Korean BC21 signed September
20134 for pellet off take to Korea
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Update and Progress: Private Industries taking the lead in Sarawak and Sabah on Biomass Initiatives towards Higher Value Added Activities
NBS2020 UPDATE
a. Biomass to Energy
a. Liquid Biofuels (Bioethanol)
a. Biochemical
a. Biomass Cluster Development- IPP- Steam- Waste
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Liquid Biofuels: World’s first commercial scale Biomass-to-
ethanol facility was launched in Italy in October 2013
1 To be determined by EPA through a future rulemaking, but no less
than 1.0 billion gallons.
Source: EPA, EISA
Beta Renewables and Novozymes marked the official opening
in Northern Italy of the world’s largest advanced biofuels
facility at 60K pta facility.
Situated in fields outside the city of Crescentino, it is the first
plant in the world to be designed and built to produce
bioethanol from agricultural residues and energy crops at
commercial scale using enzymatic conversion.
Favorable regulation fueling
growth in demand of 2G biofuel
Another 6 to 7 plants expected to go live
globally in 2014 mostly in Brazil and the US
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• The National Biomass Strategy 2020 (NBS2020) has put Malaysia
firmly on the Global radar of biomass industries according to
industry experts
• Malaysian industry, biomass owners and users, have embraced
NBS2020. Individuals, SME, Mid-size companies, large
conglomerates, as well as (State) Government agencies and
scientists have acknowledged the National importance of NBS2020
• Over 150 unique references and publications by local and
international scientists and publications** and numerous speaking
engagements by invitation at international biomass related
conferences
• Other nations in Southeast Asia, South America and the Middle
East have expressed interest to work with AIM’s NBS2020 team
to develop National Biomass Strategies for their respective
countries.A JV Cluster concept was created this year in Lahad Datu,
modeled after co-operatives to mobilize large volumes of biomass
Malaysia’s first Biomass-to-Ethanol pilot plant was established
this year in Tawau, Sabah by Teck Guan, Mitsui and Inbicon
Since the launch of Malaysia’s National Biomass Strategy,
mobilization has started, with a focus on Sabah and Sarawak
Hock Lee Group and Beta Renewables plan to start Asia’s
first commercials scale Biomass-to-Ethanol plant in Bintulu
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From a concept of biomass mobilisation to reality
Lahad Datu Biomass JV Cluster Berhad - Sabah
36
CONCEPT REALITY IMPACT
2012-2013 2014 2014
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Biomass mobilization for high-value BioFuels (ethanol) is taking off in Bintulu
through our facilitation with Biomass owners, Technology owners and
International off-takers
37
Biomass used
Million tonnes, dry weight
37
11% 31%Total:
0
5
10
15
20
25
30
35
202020152011
1%
4%
• Local Company A: Planting 15,000 Ha dedicated biomass crops
• Company A and local university collaborate on Napier trials
• Company A, Technology Provider X and Technology Provider Y formalised JV on upstream supply chain management for Sarawak Project
• Local Company B and partner collaborate to develop 2G ethanol project for Sarawak
• Partners to invest U$300m to set up Asia’s 1st second generation ethanol plant
~200m
~1bln
500k
Ethanol derived from biomass
became commercial-
scale ready last
year, the first plant in
Malaysia could come on
stream in 2 years
Companies are anonymous as project is still on-going
UNIVERSITY XYZ
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38
Update and Progress: Private Industries taking the lead in Sarawak and Sabah on Biomass Initiatives towards Higher Value Added Activities
NBS2020 UPDATE
a. Biomass to Energy
a. Liquid Biofuels (Bioethanol)
a. Biochemical
a. Biomass Cluster Development- IPP- Steam- Waste
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Biomass used
Million tonnes, dry weight
3911% 31%Total:
0
5
10
15
20
25
30
35
202020152011
1%
6%
Biomass to Hydrolysate
conversion:
3-5 yrs for first plant to
reach commercial scale (in
the world)
Possible
technology
providers:
Interested
downstream
companies:
Biomass based sugars is expected to be commercial scale ready in 3-5 years.
Through our facilitation, global Chemicals companies are considering Malaysia for
their new biochemical plants.
~1bln
~1bln
~1bln
~1bln
~1bln
~1bln
~1bln
~1bln
Chemicals derived from
biomass based sugars
are expected to be
commercial-scale
ready in 3-5
years
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Update and Progress: Private Industries taking the lead in Sarawak and Sabah on Biomass Initiatives towards Higher Value Added Activities
NBS2020 UPDATE
a. Biomass to Energy
a. Liquid Biofuels (Bioethanol)
a. Biochemical
a. Biomass Cluster Development- IPP- Steam- Waste
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If Sarawak successfully create Asia’s first integrated biomass cluster, there
will be opportunities to provide a wide array of facilities and services to the
Industrial Cluster
41
Sarawak could become Asia’s:
1stCommercial-scale biomass plantation
1stMulti-feedstock Biomass Hub
1stBio-port
1st2G ethanol plant
1st2G bio chemicals plant
~RM20 billion additional GNI impact
~10,000 new Green jobs
~RM21 billion in investment opportunities
* Numbers for 2023. Opportunity by 2020 will be ~RM10b GNI, ~6,000 jobs and 11b investment
Facilities for Biomass Cluster:
Biomass Power Plant/IPP
Biomass Steam Boiler
Industrial waster water treatment
Copyright 2012-2015 by Agensi Inovasi Malaysia. All Rights Reserved.
CONFIDENTIAL DRAFT – NOT FOR DISTRIBUTION
NBS2020 identifies specific opportunities and enablers to create high-value
industries by mobilizing 30m tonnes biomass by 2020. AIM has facilitated
NBS2020 execution through 1MBAS unit.
42
CRITICAL FACTORS TO ACHIEVE NBS2020,
FACILITATED BY AIM’S 1MBAS UNIT:Biomass used
Million tonnes, dry weight
Energy
Wood
products
4211% 31%Total:
0
5
10
15
20
25
30
35
202020152011
1%
1%
3%
1%
4%
6%
4%
9%
3%
9%
Share of total biomass
available in given year
Fuels
Pellets
Biobased
chemicals
Biomass to Wealth
~14bl
n
~8bln
~9bln
~3bln
~2bln
▪ ~2% additional GNI impact
▪ >60,000 new jobs
▪ ~12% CO2e abatement• Mobilization of large
volumes of biomass for
high-value activities
• Industry-led approach
without government
interference in selecting
technologies
• Participation of biomass
owners in downstream
activities
• Attract downstream
technology owners and
off-takers
• Scaling up of new
technologies in Malaysia
• Economic efficiencies
when it comes to
biomass aggregation
LAHAD DATU BIOMASSJV CLUSTER BERHAD
Copyright 2012-2015 by Agensi Inovasi Malaysia. All Rights Reserved.
CONFIDENTIAL DRAFT – NOT FOR DISTRIBUTION
CONCLUSION
43
• Government and Industry should move parallel (Government should not
just think like industry but also move like one) – no limitation on scope
of involvement – cause when it comes to Industry there is none
• Clarity on Objective, Action Plan and constantly Review and Relook into
progress through a proper Governance Structure
• Eco-system Approach and Sustainable (economic included)
development of Green industry
• Sustainable Feedstock supply and Mobilisation (Cost Effectiveness)
• Technology Deployment and Adoption Roadmap (Agnostic)
• Biomass Project Funding and Access to these Funds
• Off-take Market Development (Policy and Recommendations, G2G
and etc.)
• Drive the Biomass Industry with Passion and Urgency
Copyright 2012-2015 by Agensi Inovasi Malaysia. All Rights Reserved.
CONFIDENTIAL DRAFT – NOT FOR DISTRIBUTION
Lux Research’s Impact Study 2015: Key conclusions from global
benchmarking
• Of the 10 focus countries in the Study, 8 made improvements in robustness of
infrastructure and commercial impact since 2010
• India’s inward-focused strategy and China’s outward-focused strategy incrementally
advanced each country’s relative position
• Predictably, Brazil and ASEAN countries claim the most commercial projects per
capita, and the fewest start-ups
• Mentorship for start-ups, which most interviewees cited as a critical component of a
strong biomass infrastructure, saw the least amount of emphasis across all countries
• Finland has spent the least in direct investments towards biomass industries, but has
seen the greatest relative commercial activity owing to its strong venture capital
presence
• Thailand’s simple and straightforward bioeconomy policies seem to outshine those of
Malaysia, which appear vast in number, but misaligned
• The structural incentives (public and private) for the biomass sector in Malaysia are
robust and on par with global benchmarks
44Note: 10 focus countries are Malaysia, China, India, Indonesia, Thailand, Australia, Finland, Germany, U.S. and Brazil
Copyright 2012-2015 by Agensi Inovasi Malaysia. All Rights Reserved.
CONFIDENTIAL DRAFT – NOT FOR DISTRIBUTION
The Malaysian government provides financial support through
subsidies, tax breaks, and direct grants
Government support structures
Grant & loan programs
1-innoCERT: Innovation coaching programs for innovative
SMEs. Eligible to RM 1 million SME Innovation Award
Bio-Technology Venture Fund: US$100 mil venture fund
for biotech companies operating in Malaysia
Business Start-up Fund: Up to RM 5 million for technology
startups
Commercialization of R&D Fund: RM500k-RM4 mil for
university R&D commercialization initiatives
Commercialization Innovation Fund: RM500 mil fund to
assist SMEs in commercializing R&D
Cradle Investment Program: RM500k /company prototype
development fund, maximum two applications / company
Domestic Investment Strategic Fund: RM1 billion fund to
accelerate high-tech shift of Malaysian owned companies
Green Lane Facility: 2% interest rebate for approved loans
Green Technology Financing Program: RM250k to RM2
mil contract financing for green certified companies
Green Technology Financing Scheme: RM10 million up to
10 years for Malaysian-owned companies using green
technology
MyCreative Venture Capital: RM200 mil fund to increase
innovation and creativity among youth
TechnoFund: RM5 mil / company bridge fund for basic
research to commercialization
Tax rebates / exemptions
BioNexus status program: 100% income
tax exemption for value-added
biotechnology activities
Green Lane Facility: tax deductions to
obtain 1-innoCERT certification
Import duty / sales tax exemption: on
imported raw materials, components,
machinery, and equipment to produce
finished products. Minimum exemption is
RM1 mil
Investment Tax Allowance: 100% income
tax exemption for 60% of capital
expenditure for biomass-to-energy
technologies
Pioneer Status
100% statutory income tax exemption for
10 years for value-added biomass
utilization
Reinvestment Allowance: 15-year tax
allowance on 60% of capital expenditure to
update or automate factory or plant
Mandates / subsidies
10th Malaysia plan 2011-2015:
stipulates Renewable Energy Act
and Feed-in tariff mechanism
Feed-in Tariff Programme: up to
RM 46 cents/kwh tariff for bio-
energy. Guaranteed access to grid
Renewable Energy Act 2011:
15.5% renewable energy in mix by
2015
National Green Technology
Policy: Accelerate national
economy and sustainable
development with green technology
SOURCE: Lux Research Analysis, 2015
Copyright 2012-2015 by Agensi Inovasi Malaysia. All Rights Reserved.
Malaysia has already implemented a wide number of incentives
to facilitate further industry development
46
Feed-In Tariff (FiT)1
Domestic
Investment
Strategic Fund
(DISF)
2
Commercialisation
of Research &
Development Fund
4
Green Technology
Financing Scheme
(GTFS)
3
Techno Fund5
Intellectual Property
Financing Scheme
(IPFS)
6
Incentive
Grant
Grant
Grant
Grant
Grant
Pioneer Status7
BioNexus Status8
Business Start-up
Fund (MTDC)10
Investment Tax
Allowances (ITA)
9
EPP 6 Developing
Oleo Derivatives11
Credit Guarantee
Corporation (CGC)12
Tax
Incentive
Incentive
Incentive
Grant
CAPEX
Incentive
Financing
Support