| Summary: | This study delves into Malaysia’s energy utilization dynamics. Energy consumption in Malaysia has surged with per capita income during the shift from a primary-sector-driven economy to an industrialized and urbanized sector. Sustainable resource management, particularly in the energy sector, is crucial for achieving long-term sustainability goals. Using Bound Estimation and annual data from 1985 to 2020, this research employs a comprehensive systems approach, considering economic growth, foreign direct investment, urbanization, governance, and innovation to assess energy determinants in Malaysia. The results highlight economic growth, foreign direct investment, rapid urbanization, and technological advancement as the primary drivers of increased energy usage. Corruption indirectly influences energy consumption. These findings highlight tailored energy policies, emphasizing promoting alternative energy sources to align with the nation’s development goals. Understanding the root causes of Malaysia’s escalating energy consumption equips policymakers with insights to formulate sustainable strategies, ensuring steady economic growth while addressing energy-related challenges. © The Author(s), under exclusive license to Springer Nature Switzerland AG 2024.
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