Energy is the key ingredient to any economic activity. Adequacy of energy supply is important for acceleration of economic development. Consumption of energy however produces some undesirable impacts on the environment and climate.

Hence, sustainable use of energy is being given increasing attention in Malaysia. Malaysia is well endowed with both conventional (non-renewable) and non-conventional (renewable) sources of energy. The largest non-renewable energy resource found in Malaysia is petroleum (i.e. oil and gas). This resource is being actively exploited. Although, Malaysia has some coal deposits, only a small percentage is being mined.

Renewable sources of energy are also abundant in Malaysia, the most important ones being biomass and solar. As in any developing nation, energy consumption per capita in Malaysia is still low but is expanding at a rapid rate in tandem with economic development. In addition, energy intensity with respect to gross domestic product had shown an increasing trend historically.

Ministry of Energy, Green Technology and Water has been formed specifically to look at policy issues related with energy  especially issues on national electricity supply.
To enabled issues on energy handled with better and comprehensive, there were some division created under Energy Sector supervision, and the divisions are as follows :

1.    Electricity Supply Division
2.    Regulatory and Industry Development Division
3.    MESITA Fund Management Section/AAIBE

Electricity Supply Division

The functions of this division are to coordinate, manage and monitor matters related policy and supply planning country electric, implement Bekalan Elektrik Act's review and make check and tariff restructuring electric in Peninsular Malaysia, Sabah State including Federal Territory Labuan

This division also involved in nuclear policy preparation country, electricity industry development, gas and coal supply in Peninsula, supply system consolidation electric in Sabah State, supply planning electric in Sabah and propose Ministry stance relating electric supply.

Regulatory and Industry Development Division

This division function to draw and implement policy, programme, project and activity to develop energy resources that can renewable such as biomass, solar, wind, hidro-mini and so on in keeping with national power policy, energy usage promotion efficiently (enegy efficiency) and energy conservation in all national economy activity, development budget for Renewable Energy activity and Energy Effiency / Energy Conservation and alternative power development such as hydrogen fuel cell, biofuel, nuclear energy and so on.

Apart from that, this division also responsible in adjusting review all legislation related Renewable Energy and Energy Conservation by also implementing all international

MESITA Fund Management Section/AAIBE

Akaun Amanah Industri Bekalan Elektrik (AAIBE) was formally established on 1 January 1997 under a Trust Deed issued by the Ministry of Finance in accordance with Section 9(3) of the Financial Procedures Act 1957. The decision to establish AAIBE was made by the Malaysian Cabinet on 11 December 1996 which required all Independent Power Producers (IPPs) to fulfill their national obligation towards the development of electricity supply industry in the country. The IPPs which sell and supply electricity to the Peninsular Grid make contributions annually to the Trust Account. The rate agreed by the contributors is pegged at one percent (1%) of the total audited annual tunrnover of the previous year.

The contributors to the AAIBE are as follows; Tenaga Nasional Berhad (TNB), Segari Energy Ventures Sdn Bhd, YTL Power Generations Sdn Bhd, Powertek Berhad, Pahlawan Power Sdn Bhd, Panglima Power Sdn Bhd, Genting Sanyen Power Sdn Bhd, Port Dickson Power Berhad, TNB Janamanjung Sdn Bhd, GB3 Sdn Bhd, Prai Power Sdn Bhd and Teknologi Tenaga Perlis Consortium Sdn Bhd.

The types of programs allowed under the AAIBE Trust Deed implemented in Peninsular Malaysia are as follows; rural electrification program; research and development (R&D) program for the electricity industry including R&D on the development of new and renewable sources of energy; training and educational program for human resource development in the electricity sector; energy efficiency program and; the promotion and development of the electricity supply industry.

AAIBE is under the direct control of the Secretary-General of the Ministry of Energy, Green Technology and Water and administered by the AAIBE Committee. This committee meets two (2) or three (3) times a year. Members of the AAIBE Committee are as follows; Economic Planning Unit, Prime Minister’s Department, Ministry of Energy, Green Technology and Water, Ministry of Finance, Ministry of Rural Development, Energy Commision, Tenaga Nasional Berhad (TNB) and Six (6) Independent Power Producers (IPP).

The AAIBE Committee is assisted administratively by the AAIBE Technical Committee whose functions is to evaluate and recommend to the AAIBE Committee on the viability of projects/programs proposed. The technical committee is chaired by the Deputy Secretary-General (II) of the Ministry of Energy, Green Technology and Water.