Quantifying the Impact of Energy Shortage on Malaysia’s Energy Security Using a System Dynamics Approach

Malaysia is currently a net exporter of fossil energy in the form of crude oil and refined petroleum contributing to the country’s economic development but not placing sufficient emphasis on its long-term environmental sustainability. The shortage of energy scenario can be a potent threat towards the economy as it will force prudent energy usage in different sectors. This will slow down economic growth and affect consumer market. This paper aims to investigate the impact of energy shortage on the dimensional indicators of Malaysia’s energy security (ES) that has been analyzed in three dimensions: energy availability, socio-economic and environmental sustainability. The shortage of energy by 30% is a hypothetical scenario designed to replicate how this will impact Malaysia’s overall energy security by discussing the dimensions of ES and its effects. A system dynamics approach is utilized to quantify this impact for a span of 5 years from 2015 to 2020 to analyze its effects on Malaysia’s ES. Findings showed that an increase in energy shortage by 30% will greatly increase energy costs, thus impairing its affordability. As a result, the energy consumption hits the lowest limit set by the simulation suggesting an energy insufficiency to fulfill the demands of all sectors. Energy shortage will lead to an economic growth deficit but will instill an awareness to be energy-prudent, hence increasing energy efficiency amongst user groups, which can be a positive impact.