KUALA LUMPUR (April 18): Bursa Malaysia Bhd’s wholly-owned Bursa Carbon Exchange (BCX) will hold its inaugural auction of renewable energy certificates (RECs) on June 25 to support Malaysia’s energy transition plans and corporates’ net-zero aspirations.

RECs are issued when one megawatt-hour (MWh) of electricity is generated and delivered to the electricity grid from a renewable energy (RE) source. By procuring RECs, businesses ensure that the electricity they consume comes from renewable sources.

The RECs in this auction are to be supplied by Sarawak Energy Bhd, via its 944MW Murum hydropower plant, and issued under the I-REC Standard, a globally recognised standard body, according to the bourse operator.

“This auction marks a significant step towards the transition of BCX to be a one-stop, Shariah-compliant, multi-environmental product exchange,” Bursa Malaysia said in a statement on Thursday.

“RECs are a new product offering by BCX, that first started enabling the trading of carbon credits in September 2023. This underscores Bursa Malaysia’s progress as a multi-asset exchange in demonstrating access to and creating new opportunities for the market through additional types of asset classes, investment and trading choices,” it added.

Bursa Malaysia CEO Datuk Muhamad Umar Swift said the bourse operator continues to play a pivotal role in enabling the nation’s implementation of policies and key projects through the capital market.

“RECs will support Malaysia’s National Energy Transition Roadmap (NETR) which targets to substantially increase the country’s renewable energy capacity,” he said.

“Within a few months of starting carbon trading, we have been quick to expand BCX offerings to offer another complementary product in the form of RECs. These two environmental products will serve to provide Malaysian corporates choices when allocating capital for climate action financing,” he added.

According to BCX’s website, the auction is to be held over two sessions on June 25, with a minimum volume of 1,000 RECs, with a minimum incremental bid of one REC.

Entities that wish to participate in the auction must be onboarded as an approved participant of BCX.