UNDP-GEF
PROJECT CONCEPT PAPER

|Project name: |GEF implementing agency: |
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|Malaysia: Building Integrated Photovoltaic (BIPV) Technology |United Nations Development Programme (UNDP) |
|Application Project Malaysia: Building Integrated Photovoltaic | |
|Systems Project (BIPVS) | |
|Country of countries in which the Project is being implemented: |Country eligibility: |
|Malaysia | |
| |Ratified the UNFCCC on 17 July 1994. |
|GEF Focal Area (s): |Operational program/short-term measure: |
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| |OP-7: Reducing the long-term costs of low GHG emitting energy |
|Climate Change |technologies |
|Project linkage to national priorities, action plans and programs: |
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|In accordance with the ASEAN Plan of Action for Energy Cooperation for the period 1999 – 2004, the adoption of renewable energy resources|
|is a high priority in all ASEAN countries. The Third Outline Prospective Plan 3 (OPP3) of Malaysia mentions Renewable Energy (RE) as the |
|fifth fuel. It states that to supplement the conventional supply of energy, new sources such as RE will be encouraged. In this regard, |
|the fuel diversification policy which comprises oil, gas, hydro and coal will be extended to include RE as the fifth fuel, particularly |
|biomass, biogas, municipal waste, solar and mini-hydro. |
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|In the Eighth Malaysia Plan (RM8) it is mentioned that the Malaysian Government will intensify efforts to encourage the utilization of |
|renewable resources for the generation of energy to supplement the supply from conventional energy sources. The nation has also set a |
|target to achieve 5% of its electricity production through RE. Furthermore, the enhancement of the socio-economic development by creating|
|business opportunities for small and medium enterprises (SME) is part of the national development plans. Also, several national efforts |
|are in execution to foster the application of PV in urban areas. |
|GEF national operational focal point and date of country endorsement: |
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|National operational focal point: Ministry of Science, Technology and the Environment |
|Date submitted: Date endorsed: 13 April 2002 |
|Project rationale and objectives: |
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|Problem Statement |
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|While there is a significant potential for small-scale new and renewable energy (NRE) development in Malaysia, the exploitation of these |
|resources is presently hampered. To date, efforts have been focusing on the exploitation of small-scale NRE resources for rural energy |
|supply, although there is also an interesting and yet mostly unexploited application of NRE potentials in the urban areas. |
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|Solar photovoltaic (PV) solutions can be adapted to the whole range of the built environment in urban areas such as commercial, |
|industrial, residential buildings and others. PV cells integrated in glass structures provide daylight use, room shading and electricity |
|generation in one single building element, either applied as fixed construction or moveable parts. The BIPV technology also allows |
|establishing a link between the issues of NRE development and energy efficiency through the introduction and application of enhanced |
|integral energy concepts for new and existing buildings. Moreover, the willingness and ability to pay for electricity services is often |
|better in urban areas and represents a sound basis for an economically viable dissemination of the BIPV concept. There is currently an |
|increasing interest in using PV systems in urban areas as perceived in a number of ASEAN countries, especially in Malaysia. |
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|Solar PV systems are among the most promising and workable NRE solutions, providing an excellent opportunity for electricity supply in |
|urban areas. The modular structure of PV systems makes it possible to convert solar radiation into electricity over a wide power range |
|directly at the place of use. The application of PV systems on building envelopes, such as facade and roof surfaces, furthermore results |
|in synergies. Beyond the traditional purpose of utilizing solar energy, building integrated photovoltaic (BIPV) elements today work as |
|multi-functional facade or roof constructions, encompassing also the aesthetic dimension of PV systems as architectural element and as |
|substitute of high cost building elements. The technology has been proven in numerous cases worldwide. Although there is at present |
|serious interest in BIPV applications, with some trials being made, and suppliers are capable of supplying if there is substantial |
|demand, BIPV application in Malaysia is practically on a pilot scale, simply because it is not yet economically competitive. |
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|Baseline scenario: |
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|It is anticipated that in absence of the proposed GEF-supported project, building developers and architects will still rely on their |
|present design and construction, which favors more the aesthetic aspects of building design rather than that of energy efficiency. Solar |
|energy applications will remain limited to water heating using solar panels installed in rooftops and/or roof decks. Although there is |
|high level of awareness of the economic, environmental and aesthetic benefits of BIPV applications, such technology will not be employed |
|in the short to medium term because of its high cost. |
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|Alternate scenario: |
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|Under this proposed GEF- supported project, new energy saving and GHG reducing buildings are expected to be designed in the short term, |
|employing BIPV technology as multi-functional building element using synergies. The proposed project is expected to effectively reduce |
|the cost of BIPV technology and make it a least cost alternative for energy applications in buildings in urban areas. |
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|The proposed project would introduce and promote this new and innovative technology in Malaysia, through different activities like |
|targeted research, strengthening local capabilities for manufacturing BIPV systems (or its main components), adopting supportive |
|regulatory frameworks and investing in promising applications will be addressed. The objective of cost reduction will be achieved by |
|measures to influence demand and supply for BIPV systems. These measures would include: |
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|Promoting local manufacturing of BIPV systems which would lead to cost savings from economics of scale; |
|Strengthening of the institutional aspects by creating a more enabling environment for BIPV applications, for example by addressing the |
|sources of high costs of BIPV systems due to fees and charges such as permitting fees, interconnection-related fees and charges and |
|standby charges; and, |
|Encouraging “learning by doing” for local architects and engineers to increase their capacity in using the technology. |
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|These will make BIPV applications in Malaysia economically competitive as compared to the building structures that are built presently. |
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|GEF involvement: |
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|The proposed project will achieve the objective set out in GEF Operational Program 7 to reduce greenhouse gas (GHG) emissions not only |
|directly but also indirectly by inducing cost reductions in the BIPV technology, which results in a higher penetration of the energy |
|markets. |
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|As in other GEF climate change projects, the ultimate goal of this project is the reduction of greenhouse gas emissions from |
|anthropogenic sources. The project’s purpose is the encouragement of the utilization of low greenhouse gas emitting technologies, such as|
|BIPV, to contribute to the achievement of the ultimate goal. BIPV will utilize renewable resources for the generation of energy to |
|supplement the supply from conventional energy sources in urban buildings. This goes hand in hand in enhancinge socio-economic |
|development in Malaysia by creating business opportunities for small and medium enterprises (SME) active in the NRE energy sector. |
|Thereby a significant market potential could be developed promoting Malaysia as a centre of excellence on BIPV in the ASEAN region. |
|The immediate objectives of the proposed project are to: |
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|· Start with promotional activities to widespread the application of building integrated PV systems in urban areas of Malaysia, thus |
|effectively demonstratingDemonstrate the synergies of combining environmental benefits from ecologically friendly electricity production |
|with cost effective multi-functional construction application.· ; |
|Support the development of an enabling policy to encourage the use of BIPV technology by lowering costs and using economic instruments |
|such as incentives; |
|Promote different applications of BIPV systems throughout the country based on experience gained and lessons learnt in a number of |
|showcases in selected cities in Europe; and. |
|Promote local manufacturing of BIPV systems. |
|Project Expected outcomes: |
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|The global environmental objective of the proposed project is sustainable and substantial reduction of GHG emissions from burning fossil |
|fuels in Malaysia through the widespread application of BIPV systems in the country’s buildings sector. |
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|It is anticipated that in absence of the proposed GEF-supported project, building developers and architects still rely on their present |
|design and construction, which are not energy efficient and not saving GHG emission. Where as under this proposed GEF- supported project |
|new energy and GHG emission saving buildings will be designed, employing BIPV technology as multi-functional building element using |
|synergies. The proposed project is expected to effectively reduce the cost and make BIPV a widespread cost alternative for specified |
|application in urban areas. The expected outcomes of the project are the following:· |
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|Status quo report of the baseline and the alternative scenarios concerning solar PV applications in urban buildings in Malaysia, through |
|targeted research on several activities; |
|Increased capacityies building measures and technical assistance to effectively apply and use BIPV deploy technology in urban areas; |
|Enhanced quality of technical, economic and financial analyses for BIPV projects; |
|Developed frameworks for national-level policies, legislations and regulations related to the application of the BIPV technology for |
|electricity generation in urban areas adopted; |
|Established, implemented and functioning quality control mechanisms for BIPV systems; |
|Introduced suitable monetary and regulatory incentives for BIPV systems; |
|Increased awareness among policy makers, local municipalities, investors, project developers, architects and other stakeholders concerned|
|on the possibilities and potential of the BIPV technology; |
|Strengthened capabilities of the local players (e.g. engineers, architects, clients, etc.) for the efficient and sound use of BIPV in |
|suitable application; |
|· Demonstrated technical feasibility and economic viability of the BIPV technology in a number of pilot projects, preferably integrated |
|in an energy efficient building construction; |
|Established and disseminated lessons learnt, best practices and ready to use guidelines for the application of the BIPV technology for |
|electricity generation in urban areas; |
|Established pipeline of BIPV development and application projects that would create BIPV market business opportunities within Malaysia; |
|Enhanced involvement of the private sector – in particular local SME’s – in assisting in, and benefiting from the BIPV development |
|efforts; |
|Contributing to the achievement of country’s objectives to reduce GHG emissions; and, · |
|Reduction of costs for BIPV systems thanks to the several on-going enabling activities, which lead to a decline in manufacturing costs |
|and thus in increasing economiecs of scale. |
|Planned activities to achieve outcomes: |
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|In order to prove that the technology of BIPV is not only technically sound but also an economically competitive solution for reducing |
|energy consumption for power generation for use in urban buildings in Malaysia, different activities need to be carried out. These |
|include: |
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|Targeted research: Economic and financial analyses for BIPV projects are often of inadequate quality in Malaysia. More data have to be |
|analyzed to study the present perceptions on BIPV and to project the prospective demand for BIPV in the country. There is also a need to |
|analyse the potential costs and benefits of selected technologies and how to adapt them to different local conditions as well as to |
|review the effectiveness of other existing BIPV demonstration projects If needed, meteorological data will be collected and analyzed. |
|Other activities include: |
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|Conducting reconnaissance level, pre-feasibility and feasibility studies, comprising technical, institutional, economical and financial |
|assessments based on the first BIPV projects in Malaysia; |
|Monitoring the price evolution of the technology in national and international market. |
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|Capacity building: While BIPV technology is already a proven cost-effective technology in developed countries particularly in Europe, |
|there are presently uncertainties about costs, performance and benefits of the technology in Malaysia, as well as in other ASEAN |
|countries. In this project, technical assistance has to be provided for architects and engineers, thereby greatly improving the ‘learning|
|by doing’ process. Furthermore, there is a need to strengthen the local capacities (e.g. installers, engineers, architects, clients, |
|etc.) to operate, manage, maintain and evaluate new technologies and their suitable application. Capacity of policy makers will also need|
|to be further developed to be able to come up with policy and regulatory initiatives and suitable tariffs for off-grid electricity. This |
|is important as the absence of suitable monetary and regulatory incentives to incorporate PV systems into building elements deters most |
|of the potential developers and investors from adopting the technology. Other activities include: |
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|Provision of advice to governmental institutions concerned on policy, legislation and regulatory issues that affect the deployment of the|
|BIPV technology; |
|Design and implementation of technical training and capacity building programs for BIPV project development organizations, owners and |
|operators, architects and engineers, covering topics such as project identification, evaluation, planning and designing, construction, |
|implementation, operation and maintenance. |
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|Enabling policy frameworks: This will include provision of support for the development of regulations and quality control mechanisms |
|that will create a conductive and favorable environment for the development and widespread application of the BIPV technology. Other |
|activities include: |
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|Development and introduction of technical standards and quality control mechanisms for BIPV systems; |
|Design and promotion of a suitable system of monetary and regulatory incentives for BIPV systems. |
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|Awareness raising: The awareness level among policy makers, local authorities, investors, project developers and other stakeholders |
|involved in the energy sector on the potential of PV systems used as building elements is still generally low. Even though the technology|
|already has proven to be technically feasible and economically viable in a number of projects in different parts the world, the |
|perception that this technology is a high cost and “high tech luxury” prevails. This perception becomes a self-fulfilling prophecy, as |
|the subsequent low level of demand is one of the factors that keep the cost of the technology high. Other activities include: |
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|Designing and strengthening a suitable national communication framework for the dissemination of the results and the project experience; |
|Disseminating relevant information among stakeholders, industry and public concerned on technical, financial, environmental and |
|institutional aspects of BIPV development. |
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|Investment: Relevant activities will be carried out to encourage investment in the most promising applications of BIPV and demonstrate |
|the technology and its benefits and to create an environment for joint venture manufacturing, which will incorporate the transfer of |
|technology. This will encourage local manufacturing of components of PV systems. Other activities include: |
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|Implementation of a number of pilot BIPV projects to demonstrate the technical feasibility and the economic viability of the technology; |
|Monitoring of the operational performance of pilot BIPV projects over a period of minimum 2 years; |
|Mobilizing of both national and international resources to co-finance a number of BIPV pilot projects, as and when required; |
|Designing, promoting, demonstrating and implementing affordable financing mechanisms for small-scale BIPV projects in urban areas, |
|thereby giving due attention to private sector participation opportunities. |
|Determine the extent to which this reduction in prices is leading to the desired outcome of increased market share, the prices of |
|competing technologies will also need to be monitored. |
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|The activities above need to be addressed in a holistic manner to influence both local demand and supply of the PV technology in order to|
|lower the cost of the technology to commercially competitive levels. In a nutshell, cost reduction of BIPV technology will be |
|accomplished by technology transfer, joint ventures, local manufacturing, enabling policy frameworks, learning by doing, and economies of|
|scale. |
|Stakeholders involved in the project: |
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|Relevant national governmental agencies and institutions; |
|Local municipalities; |
|SSpecialized national and regional energy bodies; |
|Building associations, |
|Non-governmental Organizations (NGO’s); |
|Project developers, |
|Private sector Small and Medium Enterprises (SME); |
|Local private companies and investors; and |
|IInternational organizations with expertise and experience in the deployment of BIPV systems (e.g., SwissPower). |
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|Further stakeholders may be identified in the course of the logical framework analysis (LFA) that will be conducted as part of the |
|project development activities. |
|Information on project proponent: |
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|Ministry of Energy, Communication and Multimedia, Malaysia (MECM) is the project proponent. MECM plays the role of policy formulator and|
|service regulator for the Energy, Communications and Multimedia sectors. |
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|MECM is the executing agency for the ongoing UNDP-GEF Malaysia Industrial Energy Efficiency Improvement Project, and the recently |
|approved Biomass-based Power Generation and Cogeneration in the Malaysian Palm Oil Industry (Phase 1) |
|Information on executing agency: |
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|As above. |
|Estimated budget (in US$ or local currency): |
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|GEF: US$ 2 million |
|Others (Government of Malaysia, Private sector, International donors): US$ 5 million |
|Total: US$ 7 million |
|Implementing agency contact persons: | |
|Manuel Soriano |Thiyagarajan Velumail |
|Regional Coordinator for Climate Change |United Nations Development Programme |
|UNDP-GEF Regional Office (A&P) |Wisma UN, Block C, Damansara Office Complex, Jl. Dungun, Damansara |
|Wisma UN, Block C, Damansara Office Complex, Jl. Dungun, Damansara |Heights |
|Heights |Kuala Lumpur 50490, Malaysia |
|Kuala Lumpur 50490, Malaysia |Tel: 60-3-20959122 |
|Tel: 60-3-20915153 |E-mail: rajan.velumail@undp.org |
|E-mail: manuel.soriano@undp.org | |