Malaysia has introduced the Carbon Capture, Utilisation, and Storage (CCUS) Bill 2025 to regulate carbon capture, utilisation, and storage activities, aiming to reduce greenhouse gas emissions and align with international climate commitments. The bill establishes a comprehensive framework, including the creation of a regulatory agency, mandatory registration and permitting, monitoring protocols, and a licensing system for carbon transportation.
What is the CCUS Bill about
The CCUS Bill, introduced by the Ministry of Economy on March 3, aims to establish a comprehensive framework for carbon capture activities in Malaysia. Key provisions include:
- The creation of the Malaysian Carbon Capture, Utilization, and Storage Agency to manage licensing, compliance, and industry development.
- Mandatory registration and permitting for both offshore and onshore carbon capture facilities and storage sites.
- Strict monitoring protocols to prevent leaks and environmental damage.
- A licensing system for carbon transportation and imports, requiring registration for moving captured carbon dioxide.
- An Injection Levy and a Post-Closure Monitoring Fund to support long-term monitoring and address storage risks.
- Violations may result in fines up to RM2 million or prison sentences of up to five years. The bill applies to Peninsular Malaysia and Labuan, with state consultations required for Sabah and Sarawak.
While the government views this as essential for climate action and economic growth, environmental groups like Sahabat Alam Malaysia (SAM) have raised concerns about the lack of public consultation, the effectiveness of carbon capture technologies, and potential environmental risks.
Key Issues with the CCUS Bill
1. Lack of Public Consultation
Environmental groups criticise the hasty approval and limited engagement with stakeholders, particularly local communities, in drafting the bill. This can lead to policies that don’t adequately address local concerns or potential impacts.
2. Effectiveness of Carbon Capture
There are questions about whether carbon capture technologies are truly effective in reducing emissions and whether they might divert resources from more sustainable solutions like renewable energy and energy efficiency. Critics argue that the high costs and energy requirements of carbon capture systems could be better spent on expanding renewable energy capacities or improving energy efficiency measures, which have proven track records of reducing emissions more directly.
3. Environmental Risks
Concerns exist regarding the potential for leaks from carbon storage sites, which could harm ecosystems and public health. Example of the risks are ecosystem damage from CO₂ and co-pollutant emissions and contamination of drinking water. Health risks are also substantial, with potential for asphyxiation from concentrated CO₂, chronic respiratory issues from co-pollutants, disproportionately affecting vulnerable communities near these facilities.
The key messages to be delivered highlight two important perspectives. From the government’s viewpoint, CCUS is seen as a vital tool for achieving climate goals while fostering economic development. Meanwhile, civil society emphasises the need for thorough public consultation to ensure that environmental risks are addressed and that genuinely sustainable solutions are prioritised. This balance between economic growth and environmental responsibility is crucial for the successful implementation of CCUS initiatives.
Source: Sustainability Matters
At BBC, we acknowledge the importance of striking a balance between achieving profits and contributing positively to the environment. Read our article on ‘Navigating the Future of CCUS in Malaysia: Insights from Global Case Studies’, where we deep dive into the efficacy of carbon capture, utilise and storage technology.
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