Maybank has signed a letter of intent on 6 October 2021 with TNBX Sdn Bhd, a wholly owned subsidiary of Tenaga Nasional Berhad (TNB), to purchase Malaysia Renewable Energy Certificates (mRECs) that is equivalent to 70% of its Malaysian operations’ Scope 2 carbon emissions. This will make Maybank the first bank in Malaysia to purchase these non-tangible energy commodities to support renewable energy generation as part of its sustainability goals.
An REC is a tradable, market-based instrument that is produced for every 1 MWh of renewable energy generation delivered to the grid, together with all the associated environmental benefits of displacing 1 MWh of conventional power.
RECs enable anyone, anywhere, to switch to renewable energy, and allows the certificate owner to claim the environmental benefits of the clean energy production as the green attributes/carbon credits are passed to the purchaser. They also provide green power options in areas that may not be suitable for renewable resources, allowing renewable facilities to be located where they are the most efficient.
Maybank’s intended purchase of these mRECs will be for an initial five-year period beginning January 2022. It is expected to help reduce the Group’s Scope 2 carbon emissions within its Malaysian operations by some 70% each year. The Malaysian operations account for about 63% of the Group’s total Scope 2 emissions in 2020, which totaled 109.3k tCO2.
Maybank Group President & CEO, Datuk Abdul Farid Alias said that the intended purchase of the mRECs is one of the components of Maybank’s overall efforts to achieve its sustainability goals that were recently announced as part of the Group’s five-year M25 Plan.
In July 2021, Maybank presented its long-term sustainability commitments designed to propel the Group’s growth and strengthen its position as a regional ESG leader. One of the four headline commitments on sustainability include achieving a Carbon Neutral position for Scope 1 and 2 emissions by 2030 and Net Zero Carbon Equivalent position by 2050.
“The introduction of the mRECs to our portfolio is a step towards realising our carbon neutral position by 2030 and reflects our ultimate pursuit in driving responsible transition through our commitment to opt for renewable energy, wherever possible, to power our Group operations,” he said. “We are also supporting the overall ecosystem as the proceeds from the intended purchase of the mRECs will be used to construct more renewable energy plants and thus encourage the further development of such energy sources in the country.”
Maybank’s Carbon Neutral 2030 commitment refers to the Group’s own emissions while its Net Zero 2050 commitment refers to achieving an overall balance between all direct and indirect emissions, covering both the operations of the Group and the business activities that it finances.
“The issue of climate change is something we all cannot afford to take lightly and it is crucial that all of us do our part by reducing carbon emissions, to drive change for a better world,” added Datuk Farid.
“On our part, while the mRECs will help reduce our Scope 2 emissions by about 70%, we will also continue to work on other internal initiatives to achieve a reduction of the remaining 30% in emissions. These include implementing energy efficiency programmes to reduce internal power consumption, improving infrastructure efficiency, reducing staff travel and increasing our green building footage, as well as managing waste and water consumption and boosting recycling efforts.”
He said that as the Group focuses on its ultimate goal of net zero emission, it has already started to engage suppliers to help them meet ESG principles and standards as well as work with clients to ensure that they embrace sustainability principles in projects financed by the Group. At the same time, it is also continuing to implement appropriate measures to balance the emissions within the broader geographical coverage of the Group’s operations.
The mREC certificates are registered with The International REC Standard Foundation (I-REC) which is a global non-profit organisation that provides a robust attribute tracking standard for use around the world and is approved by all major standards and campaigns. These include CDP (a not-for-profit charity that runs the global disclosure system for investors, companies, cities, states and regions to manage their environmental impacts), WRI (a global research organisation that works with governments, businesses, multilateral institutions and civil society groups to develop practical solutions that improve people’s lives and protect nature) and RE100 (a global initiative which is joined by businesses committed to 100 renewable electricity).
TNBX Sdn Bhd is currently the only single provider of mRECs and with recognition of certification from IREC.