In a significant move to accelerate its energy transition, Malaysia has announced a series of policy relaxations and expansions to make solar energy installation more accessible and attractive. These changes, aimed at both residential and non-residential users, are part of the country’s broader strategy to achieve its renewable energy targets and reduce carbon emissions.
Key Changes to Solar Energy Installation Policies
No Capacity Limits for Self-Consumption Solar
Under the Solar Self-Consumption Program (SelCo), introduced in 2017, users were previously restricted to installing solar panels only on rooftops, with a capacity limit of 85% of the building’s maximum electricity demand.
The Ministry of Energy and Natural Resources (PETRA) has now revised this policy to better align with corporate goals in environmental, social, and governance (ESG) initiatives and carbon reduction efforts. Key updates include:
- Removal of capacity limits for solar installations.
- Expansion of installation sites to include ground-mounted and floating solar systems on private land.
- The agricultural sector will be included in the program.
- A new requirement for energy storage systems is to ensure the national grid’s stability.
These changes took effect on January 1, 2025, providing greater flexibility for businesses and industries to adopt solar energy.
Increased Net Metering Quotas
To further encourage solar energy adoption, PETRA has also increased the quotas for its Net Energy Metering (NEM) program, which allows users to offset their electricity bills by sending excess solar power back to the national grid.
- Residential Users (NEM Rakyat): The quota has been raised from 450 MW to 600 MW.
- Commercial and Industrial Users (NEM NOVA): The quota has been increased from 1,400 MW to 1,700 MW.
The application deadline for the NEM program has been extended to June 30, 2025, though it may close earlier if the quota is filled.
Extended Subsidies for Residential Solar Installations
The Solaris Program, which provides subsidies for rooftop solar panel installations, has also been extended. Key details include:
- Subsidy Amount: Up to MYR 4,000 (approximately USD 890) per kW for first-time residential applicants.
- Application Deadline: Extended to April 30, 2025.
This program aims to make solar energy more affordable for homeowners, encouraging wider adoption across the country.
Malaysia’s Renewable Energy Goals
These policy changes are part of Malaysia’s National Energy Transition Roadmap (NETR), which aims to increase the share of renewable energy in the country’s power generation mix to 70% by 2050, up from the current less than 20%.
By relaxing installation requirements, increasing quotas, and offering financial incentives, the government is paving the way for a cleaner, more sustainable energy future.
Why This Matters
For Businesses and Industries
- Greater flexibility in solar installation locations and capacities.
- Enhanced ability to meet ESG and carbon reduction goals.
- Potential cost savings through self-consumption and net metering.
For Homeowners
- Increased affordability through subsidies and net metering benefits.
- Reduced electricity bills and potential earnings from excess energy.
For the Environment
- Accelerated adoption of renewable energy to reduce carbon emissions.
- Support for Malaysia’s commitment to global climate goals, such as the Paris Agreement.
Conclusion
Malaysia’s latest policy updates mark a significant step forward in its renewable energy journey. By removing capacity limits, expanding installation options, and increasing quotas for net metering, the government is making solar energy more accessible and appealing to a wider audience.
These changes not only benefit individual users but also contribute to the country’s ambitious goal of achieving 70% renewable energy by 2050. As Malaysia continues to embrace solar power, it sets a strong example for other nations in the region to follow.
