Reinstatement of the Green Technology Financing Scheme 2.0 (GTFS 2.0)

3 Jun 2019

The Ministry of Energy, Science, Technology, Environment & Climate Change (MESTECC) continues to support the growth of green technology in the country with the Green Technology Financing Scheme (GTFS) and GITA/GITE (Green Investment Tax Allowance/Green Income Tax Exemption).

With the reinstatement of the Green Technology Financing Scheme 2.0 (GTFS 2.0), a fresh financing approval of up to RM2.0 billion has been allocated for a period of two (2) years from 2019 to 2020. GTFS 2.0 will also continue to provide the 60% government guarantee on the green component cost financed by Participating Financial Institutions (PFIs) as well as the 2% p.a rebate on interest and profit for seven (7) years. The financing limit for Producer and User category is up to a maximum of RM100 million and RM50 million respectively.

To encourage the growth of the adoption of green technology, the government had also expanded the list of green assets to be qualified for the Green Investment Tax Allowance for green assets or GITA-Assets from 9 to 40 assets. This tax incentive was introduced in 2014 to boost up the utilisation of green technology equipment.

One of the main enhancements in the GTFS 2.0 is the inclusion of Energy Services Company (ESCOs) to be eligible for financing investments or assets related to energy-efficient projects and Energy Performance Contract (EPC). ESCO’s are eligible to obtain a maximum financing of RM25 million for a period of up to five (5) years.  This is in line with the country’s aspiration to spur the energy efficiency business as a new economic growth area.

Commenting on the GTFS 2.0 financing, YB Puan Yeo Bee Yin, Minister of Energy, Science, Technology, Environment and Climate Change said, “The implementation of GTFS is important to ensure that projects that are green technology-based continue to receive funding and support, which will contribute to the growth and development of the country’s green technology industry.”

“The implementation of GTFS 2.0 is important to ensure green technology-based projects continue to receive support, which will directly contribute to the growth and development of the green technology industry and in the face of climate change” she added.

As the Malaysian green technology market expands, the number and scope of projects in green technology are growing in tandem which in turn is driving up the demand for financing. The GTFS 2.0 will encourage companies to take on larger scale green projects providing a substantial boost for the local green market. The Scheme will continue to support six (6) main sectors namely Energy, Waste, Water, Building, Transport and Manufacturing.

With the green technology market in Malaysia growing fast, in tandem with the demand for financing by the industry, the Government is committed to ensure the landscape remains attractive.

Speaking on the importance of the GTFS, Tuan Syed Ahmad Syed Mustafa, Acting CEO of GreenTech Malaysia said, “Green Technology Financing Scheme (GTFS) has been instrumental in growing green businesses and the green technology sector in Malaysia. It has helped hundreds of green companies gain access to financing that is vital in establishing their green ventures. It has also provided a hands-on opportunity for financial institutions to familiarise themselves with the intricacies of financing green businesses. The success of this is evidenced by the record number of approved financing for green projects we achieved in 2017.”

The expansion of the list of assets under the GITA-assets is expected to stimulate the market for green products, accelerating the growth to a greener economy. Other tax incentives include the Green Investment Tax Allowance for green projects and the Green Income Tax Exemption for green service providers.

GreenTech Malaysia is the implementing agency tasked to administer the GTFS 2.0 and green tax incentives. For more information please go to:

Source : Focus Malaysia | 31 May 2019 | 15:37

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