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The Optimal Generation Cost-Based Tariff Rates for Onshore Wind Energy in Malaysia

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  • Aliashim Albani

    (Eastern Corridor Renewable Energy (ECRE) Research Group, Universiti Malaysia Terengganu, Kuala Nerus, Terengganu 21030, Malaysia
    School of Ocean Engineering, Universiti Malaysia Terengganu, Kuala Nerus, Terengganu 21030, Malaysia)

  • Mohd Zamri Ibrahim

    (Eastern Corridor Renewable Energy (ECRE) Research Group, Universiti Malaysia Terengganu, Kuala Nerus, Terengganu 21030, Malaysia
    School of Ocean Engineering, Universiti Malaysia Terengganu, Kuala Nerus, Terengganu 21030, Malaysia
    TATI University College, Teluk Kalong, Kemaman, Terengganu 24100, Malaysia)

  • Che Mohd Imran Che Taib

    (Eastern Corridor Renewable Energy (ECRE) Research Group, Universiti Malaysia Terengganu, Kuala Nerus, Terengganu 21030, Malaysia
    School of Informatics and Applied Mathematics, Universiti Malaysia Terengganu, Kuala Nerus, Terengganu 21030, Malaysia)

  • Abd Aziz Azlina

    (Eastern Corridor Renewable Energy (ECRE) Research Group, Universiti Malaysia Terengganu, Kuala Nerus, Terengganu 21030, Malaysia
    School of Social and Economic Development, Universiti Malaysia Terengganu, Kuala Nerus, Terengganu 21030, Malaysia)

Abstract

The government of Malaysia has recently decided to explore the feasibility of wind energy to generate electricity in the country. Their ambition is to achieve a measureable target in the percentage contribution of electricity generated by renewable energy technology in the national electricity generation mix. As part of this initiative, a study of wind energy policy has been conducted by identifying the optimal feed-in tariff (FiT) rates to support the development of wind energy in the country. The aim of this paper is to calculate the optimal level of tariff that is suitable with local wind conditions. A closed-form equation for optimal feed-in tariff rate of wind energy with consideration of the availability of capital allowance has been developed. The focus is on small- and utility-scale wind turbine installations. As a result, by considering the availability of capital allowance, the optimal FiT rates for small-scale wind turbines in Malaysia are between 0.9245–1.1313 RM/kWh, while utility-scale rates are between 0.7396 and 0.9050 RM/kWh. The level of FiT is changed with the changing value of economic parameters. Kudat, in northern Borneo, has been identified as a prime site for wind energy development in the country; however, more work needs to be conducted, including the development of a regional wind map and measurement of wind data at more new potential sites.

Suggested Citation

  • Aliashim Albani & Mohd Zamri Ibrahim & Che Mohd Imran Che Taib & Abd Aziz Azlina, 2017. "The Optimal Generation Cost-Based Tariff Rates for Onshore Wind Energy in Malaysia," Energies, MDPI, vol. 10(8), pages 1-16, July.
    • Handle: RePEc:gam:jeners:v:10:y:2017:i:8:p:1114-:d:106443
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