carbon footprint. Three (3) of TNB’s ET projects have been adopted under two (2) of the NETR’s flagship catalyst initiatives, namely solar park and hybrid hydro floating solar PV under the RE Zone initiative and co-firing of hydrogen and ammonia under the Hydrogen for Power initiative. MANAGEMENT APPROACH SUSTAINABILITY DISCLOSURES ON MATERIAL MATTERS Energy Usage Energy Vector Energy Sources Deliver Clean Generation • Renewable Capacity Growth • Carbon Management • Coal Generation Capacity Reduction Develop Energy Transition Network • Smart Grid • Hydrogen • Energy Storage Dynamic Energy Solutions • Electrification • Energy Efficiency • Prosumers • Digital platforms SUSTAINABILITY STATEMENT Sec 3 69 The energy transition, marked by a shift from conventional fossil fuel-based energy sources to cleaner and more sustainable alternatives, significantly impacts electrical grids. Distributed energyresources (DERs) such as rooftop solar panels play a pivotal role in creating a more decentralised energy landscape. Unlike the traditional one-way flow of energy from power plants to consumers through the transmission and distribution grid, this decentralisation introduces a bidirectional flow of electricity. Consumers now increasingly become prosumers, actively participating in both electricity production and consumption. The management of these dynamic energy flows necessitates the implementation of smart grids and Advanced Metering Infrastructure (AMI). In 2023, the Grid Division and Distribution Network Division invested over RM2.9 billion and RM5 billion of capital expenditure, respectively, in securing, maintaining and modernising our national grid. The highlights of our smart grid initiatives include the facilitation of RE penetration into the system, expanding AMI and real-time network monitoring and control. Additionally, in 2023, we enhanced our efforts in realising the ASEAN Power Grid aspiration by forming strategic partnerships with ASEAN Member States in the region. Facilitation of RE Penetration The