Driving Renewable Energy Through Carbon Pricing: Malaysia’s Path Toward Emission Trading System

This paper explores emission trading systems (ETS) in promoting renewable energy through carbon pricing mechanisms, such as cap-and-trade. It examines how ETS has encouraged renewable energy in the European Union and California, and analyses changes in Malaysia's regulatory initiatives. The paper evaluates the effectiveness of ETS in improving the renewable energy industry, despite the absence of a fixed carbon price. It contends that an optimally structured ETS could lead to sustainable energy utilisation and align with the Paris Agreement. The paper presents policy measures to improve ETS effectiveness and safeguard the Malaysian energy sector.

Carbon Pricing; Emission Trading Systems

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