PETALING JAYA: A groundbreaking ceremony was held on Friday for a RM31 million biomass steam plant located within Kaneka (Malaysia) Sdn Bhd’s chemical industrial complex in Gebeng Industrial Estate, Pahang.
The project, led by BAC Renewable Energy Sdn Bhd (Bacre) through its subsidiary Bacre Gebeng Sdn Bhd, marks a major milestone in Malaysia’s renewable energy journey and industrial decarbonisation efforts.
Developed under a 20-year steam supply and purchase agreement, the plant will supply Kaneka Malaysia with up to 30 tonnes per hour (TPH) of green steam, replacing conventional natural gas-based steam generation, positioning the facility as a long-term contributor to Kaneka’s sustainability goals.
Kaneka Malaysia has set an ambitious target to reduce its greenhouse gas emissions by 70% by 2030, as part of its broader commitment to achieving net zero by 2050.
The project is made possible through a strategic collaboration involving Kaneka Malaysia as the offtaker and landowner, and led by Bacre Gebeng Sdn Bhd as the project developer, owner and operator. Knight Frank Project Services Sdn Bhd (under Knight Frank Malaysia) serves as the turnkey contractor responsible for end-to-end project delivery, while Boilermech Sdn Bhd provides the boiler technology and system integration. The initiative is financially supported by Bank Islam Malaysia Bhd, with Emnes Metal Sdn Bhd contributing as a strategic partner to facilitate cross-sector coordination and sustainability integration.
Knight Frank Malaysia senior executive director Teh Young Khean remarked that they are committed to supporting projects that drive sustainable development and responsible industrial growth.
He added that the biomass steam plant exemplifies how innovative project management and strategic partnerships can deliver tangible environmental benefits while supporting Malaysia’s renewable energy goals.
Kaneka Malaysia managing dierctor Hiroyuki Nishimoto commented, “This green steam initiative reflects our commitment to sustainability and innovation. Working with Bacre and its consortium of partners allows us to significantly reduce our carbon footprint by about 30,000 tCO2e per year while enhancing operational efficiency. This is also a breakthrough for Kaneka Corporation, Japan, by having its first biomass steam plant here in Kaneka Malaysia”
Situated on 3.4 acres, the biomass steam plant is designed as a showcase of industrial sustainability. Once completed, it will deliver renewable steam directly to Kaneka Malaysia’s operations, displacing fossil fuels and reducing greenhouse gas emissions.
Bacre Sdn Bhd director Hasnoel Ramly said: “This project reflects Bacre’s mission to turn palm waste into a reliable and sustainable energy resource. We are building and operating this facility with a vision to set a benchmark for industrial decarbonisation in Malaysia. It is not only about supplying steam to Kaneka; it is about driving change in how industries source their energy.”
The plant is expected to avoid 24,240 tonnes of CO₂ emissions annually, with an additional 70,032 tCO₂ reduction over 10 years from methane avoidance by preventing the uncontrolled decomposition of empty fruit bunch, which releases potent greenhouse gases such as methane and nitrous oxide.
Scheduled to be operational by the third quarter of 2026, the biomass steam plant directly supports the national agenda of MyRER and the National Energy Transition Roadmap by converting agricultural waste into clean energy; reducing industrial carbon emissions; creating local employment opportunities; reinforcing circular economy principles and enhancing Malaysia’s global competitiveness in environmental, social and governance-led industries.
