The World Bank Group (WBG), through its private sector arm the International Finance Corporation (IFC), Permodalan Darul Ta’zim (PDT), the strategic investment arm of the Johor State, and Ditrolic Energy, an integrated energy company, have signed a collaboration agreement to jointly develop a $6 billion Southern Johor Renewable Energy Corridor (SJREC) in Malaysia.

The parties said in a statement on Monday that the 2,000 kilometer-squared hybrid solar and battery energy storage system zone in Johor will power the industrial development of Johor with clean electricity and support the ASEAN Power Grid (APG) initiative by facilitating cross-border electricity trade.

The collaboration letter, signed on Monday in conjunction with the launch of the Johor Renewable Energy Policy 2030, outlines joint efforts across project development, technical support, and potential financing for the project.

The initiative aligns with the ambitions of the Johor Green Development Policy 2030.

Developed as a key component of the Johor–Singapore Special Economic Zone (JS-SEZ) masterplan, the initial phase of SJREC is expected to include up to four gigawatts peak (GWp) of solar capacity and 5.12 gigawatt hours of energy storage capacity on a 10,000-acre site.

The $6 billion project will generate clean electricity to meet the renewable energy needs of local and multinational corporations, including hyperscale data-center operators, manufacturers, and other businesses in Johor, which is emerging as a key industrial and digital hub in Southeast Asia.

The project will also enable clean electricity transmission to Singapore, supporting the broader APG initiative, ASEAN’s collective effort to connect the region’s electricity networks and strengthen energy cooperation by 2045.

“The SJREC was conceived as the cornerstone of this policy, specifically Strategy 1, to unlock the immense solar potential of the Kota Tinggi and Mersing districts,” said Ramlee bin A Rahman, President and Group Chief Executive of Permodalan Darul Ta’zim.

“By partnering with global leaders like IFC and Ditrolic Energy, we are operationalizing the SJREC not only to power the JS-SEZ, but to actively facilitate cross-border energy trading,

“This project confirms Johor’s readiness to serve as a primary renewable energy hub for the ASEAN Power Grid, realizing the vision we set forth for a sustainable, high-growth future,” he noted.

According to him, the project is expected to generate significant economic benefits for the region by creating an estimated 125,000 jobs through the construction, operations, and maintenance of renewable-energy infrastructure, enabling industrial expansion, and attracting high-quality, foreign-direct investment.

Tham Chee Aun, Chief Executive Officer of Ditrolic Energy, said the 4GWp solar-plus-storage catalytic development within the SJREC will anchor Johor’s clean energy export potential and provide a foundation for industries seeking renewable, low-cost power in the region.

The collaboration follows the recent launch of the ASEAN Power Grid Financing (APGF) initiative, a flagship regional effort to support the APG by mobilizing large-scale financing for cross-border power interconnections across land and on the seabed.

APGF is led by the Association of Southeast Asian Nations and the ASEAN Center for Energy and coordinated by the World Bank Group and the Asian Development Bank.

Judith Green, World Bank Group Country Manager for Malaysia, said not only will this project support the broader sustainable development ambitions of Johor, it will also create jobs, potentially attract foreign direct investment, while facilitating cross-border clean energy trade between two key ASEAN economies, bolstering the broader ASEAN Power Grid initiative.

The official announcement and agreement exchange are also underscoring royal and governmental support for Johor’s clean energy transformation and cross-border cooperation with Singapore, said the statement.

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