Times are good in the former British colony of more than 27 million people just north of the equator. Heavy government and private investments have allowed this largely Muslim nation to rebound impressively from the Asian financial crisis of the 1990s. Once reliant on agriculture and export commodities such as rubber and tin, Malaysia’s commerce is now dominated by manufacturing, becoming one of the world’s largest producers and exporters of electronics over the past few years.

Life expectancy is about 71 years, primary school enrollment is at 93 percent, and poverty is just over five percent, compared with almost 50 percent in the early 1970s.

Fueling this transformation has been one of the world’s fastest-growing energy sectors. And the key metric, not surprisingly, is electricity generation. Between 1990 and 2006, Malaysia electricity generation increased by 300 percent. (China’s increased by 356 percent.) In 1990, Malaysia generated 25.3 terawatt-hours of electricity. In 2006, that had grown to 101 TWh.

That huge increase has spurred Malaysia’s economy. In 1990, according to the United Nations, Malaysia’s per capita gross domestic product was $2,467. Last year, that figure was $6,100. And this year, its G.D.P. is expected to grow by 6 percent or more. Malaysia’s economy is doing so well that the government has repeatedly cut the corporate income tax.

The links between economic growth and electricity use is not surprising, says Yi-Chong Xu, a professor at Griffith University’s School of Governance in Australia and an expert on electricity reform and the economies of southeast Asia. “There is always a positive correlation between economic growth and electricity capacity,’’ says Yi-Chong. “You cannot have electricity infrastructure unless you have the economic growth, but you cannot have economic growth until you have sufficient supply….The two go together and so Malaysia has managed to develop a large energy sector.’’

And electricity demand – more than half from industrial users, but increasingly from commercial and residential customers as well – continues to grow about 6 percent annually. But while many developed nations are seeking more “green” electricity, Malaysia is marching to a different drum, perhaps because it can.

Although Malaysia is a signatory to the Kyoto Protocol, according to figures provided by the International Energy Agency it produces an average of 5.45 tons of carbon emissions per person, comparable to the world average of 4.22 tons (neighboring Australia, by contrast, has an output of almost 18.5 tons). With room to spare in its emission targets, Malaysia has gone to coal.

With moderate amounts of domestic reserves, Malaysia counts heavily on coal imports from Indonesia and Australia. Reliant for so long on gas, its government has invested billions in developing coal-fired power, motivated as much by the desire to diversify its energy sector as by the desire to utilize its coal resources.

“The key issue is energy security,’’ says Dr. John Asafu-Adjaye, of Australia’s University of Queensland. “For most countries with very, very fast-growing economies, they’re worried about where their energy is going to come from. What’s growing in Malaysia is the manufacturing industry, and electronics are the fastest-growing element of that. If you rely on one source you’re subject to more unforeseen shocks, and that causes the economy to slow down.”

While gas accounts for almost 42 percent of the country’s energy supply, coal now provides about 25 percent, and that percentage is growing. By 2010, Malaysia will have invested about $10 billion in coal-fired power plants. Among the biggest projects is a 2,100 megawatt bituminous coal-fired project in Johor, the country’s most populous and southernmost province, on the Singapore border.

In 2003, SKS Power, an independent Malaysian power producer, awarded a $1.5 billion contract to Japanese power company Sumitomo Corp. to construct three 700 MW units at the Johor site. The plant was commissioned in August 2006.

Malaysia is also relying on hydropower, which provides about 13 percent of the country’s electricity and is more environmentally sound than coal (at least in terms of emissions). The Malaysian government has high hopes for the leviathan Bakun Hydroelectric Project in Sarawak, one of two Malaysian states on the northern island of Borneo. Now on the cusp of completion after false starts in the 1960s and 1990s, the project, which cost more than $1.8 billion, is an engineering marvel that features the largest dam in southeast Asia, and second highest in the world.

By 2010, the dam is expected to provide 2,400 MW of new capacity, despite vehement criticism that it displaced indigenous Malays and destroyed the area’s flora and fauna. A landmass reportedly the size of Singapore was also submerged by the development. Up to 75 percent of Bakun’s output will be consumed by the country’s booming capital, Kuala Lumpur, when 400 miles of high-voltage submarine cables, the world’s longest, are installed. Much of the remaining power will be used by a recently announced $2 billion smelter project.

Owned by global mining giant Rio Tinto, the world’s second largest producer of aluminum, the smelter will start operating in 2010 and boast a production capacity of 550,000 tons a year.