Abang Johari (right) with his deputies Datuk Amar Douglas Uggah Embas (left) and Datuk Amar Dr Sim Kui Hian at the DUN Chamber today. – Photo by Sarawak Premier’s Office

KUCHING (Nov 24): Sarawak will implement a carbon levy on the oil, gas and energy sectors from next year, under the Environmental (Reduction of Greenhouse Gases) Ordinance 2023.

Premier Datuk Patinggi Tan Sri Abang Johari Tun Openg described the levy as a key step in Sarawak’s journey towards achieving net-zero emissions by 2050.

“Carbon pricing is a crucial policy instrument. It internalises environmental and social costs, reduces emissions in high-emitting sectors, accelerates the green economy transition, and ensures a just and equitable outcome for workers and communities,” he said while tabling the Supply (2026) Bill, 2025 at the State Legislative Assembly building here on Monday.

The levy will apply to emissions generated within Sarawak by regulated facilities in the oil, gas and energy sectors.

Revenue collected will be channelled into a dedicated Climate Change Fund to support renewable energy deployment, energy-efficiency initiatives, grid modernisation, forest conservation, and climate-resilience projects benefiting communities statewide.

Abang Johari added that Sarawak is ready to collaborate with the federal government to harmonise national carbon tax and carbon-pricing frameworks.

“With our Ordinance already in force, established Measurement, Reporting and Verification systems, advanced modelling, and detailed policy design underway, Sarawak is well-positioned to lead Malaysia’s decarbonisation efforts, achieve its Nationally Determined Contribution targets, and develop a strong domestic carbon market.

“The carbon levy will also serve as a future revenue source for Sarawak,” he said.