THE ROLE OF GOVERNMENT IN REDUCING ENERGY CONSUMPTION IN MALAYSIA

Abstract

The rapid economic growth in Malaysia has been consistently accompanied by an upward trend in energy consumption, driven by rapid industrialization, urbanization, population increase, and continued dependence on fossil fuel. These developments pose significant economic, environmental, and energy security challenges, especially within the framework of climate change commitments and sustainable development imperatives. This paper discusses the role of the government in the reduction of energy consumption in Malaysia by analysing policy frameworks, fiscal measures, and institutional mechanisms put in place for energy efficiency improvement. Adopting a mixed-method approach, the study draws on secondary data obtained from government reports, international organizations, and academic literature, supported by comparative insights from selected advanced economies. The findings reveal that government-driven initiatives, like subsidy rationalization, offering financial incentives, regulatory standards, and implementing the National Energy Efficiency Action Plan, are crucial in determining energy consumption behavior across important sectors. However, challenges of enforcement, high initial investment costs, and limited public awareness persist. The study finds that sustained policy coordination and stronger institutional capacity are vital for realizing long-term reductions in energy consumption in Malaysia.