The rising power of solar energy in Malaysia

In line with this, in August 2023, the government unveiled the National Energy Transition Roadmap (NETR), a strategic blueprint centred on these key energy transition levers: energy efficiency, renewable energy (RE), hydrogen, bioenergy and green mobility, as well as carbon capture, utilisation, and storage (CCUS).

 

This initiative aligns with international commitments such as the Paris Agreement and the United Nations Sustainable Development Goals. In addition, the 12th Malaysia Plan has laid out steps to achieve net zero emissions by 2050, by reducing greenhouse gas (GHG) emissions by up to 45% in 2025 and 60% in 2035.

At net zero, carbon dioxide continues to be released into the atmosphere, but an equal amount is also removed through natural carbon sinks such as forests, resulting in a net zero emission of GHG.

 

Currently, fossil fuels dominate Malaysia’s energy supply. The country’s total primary energy supply mix consists of natural gas (42.4%), crude oil and petroleum products (27.3%), and coal (26.4%) while renewables – comprising hydropower, solar, and bioenergy – make up just (3.9%). Fossil fuel sources reportedly contributed to 33% of Malaysia’s GHG emissions in 2019.

To this end, the NETR’s Responsible Transition (RT) Pathway 2050 aims to shift Malaysia’s energy systems from fossil fuel-based to greener and low-carbon systems. The expected outcomes would be a reduction in fossil fuel reliance from 96% in 2023 to 77% in 2050, and an increase of RE in the total primary energy supply to 23% in 2050.

The existing renewable energy capacity mix in the power sector stands at just 28%. To achieve the target of 59GW or 70% renewable capacity by 2050, the government plans to expand RE development.

This involves encouraging investment across the RE value chain, increasing the installation of solar systems in buildings, and facilitating cross-border RE trade.

Malaysia is a major international hub for photovoltaic (PV) components manufacturing, with six out of 10 of the world’s largest solar PV companies operating in Malaysia.

Malaysia’s commitment to developing RE is also evident in the 2024 budget, where RM2 billion was allocated to the NETR, together with a RM200 million startup fund for the New Industrial Master Plan 2030.

On top of that, financial institutions are providing a further RM200 billion in financing to encourage industries to transition towards a low-carbon economy. Under this Green Technology Fund Scheme, firms are entitled to a 2% interest subsidy and a 60% government guarantee on the approved loan.

Additionally, to incentivise companies, the Green Investment Tax Allowance and the Green Income Tax Exemption have been reviewed and enhanced.

Homeowners who intend to transition to solar energy may also affordably do so through the energy transition and water transformation ministry’s recent initiative, the Solar for Rakyat Incentive Scheme, which offers rebates of up to RM1,000 per kilowatt for each individual who applies for the Net Energy Metering (NEM) programme, at a cap of RM4,000 per person.

On Jan 26, the ministry announced that the NEM 3.0 programme would continue until December 2024 or until all quotas are allocated. It comes with additional quotas under three categories, namely the NEM Rakyat, NEM GoMen (for government ministries and entities), and Nova.

According to the International Energy Agency’s World Energy Outlook 2020 report, solar energy is the cheapest source of electricity in history.

Solar panels, with a lifespan of between 25 to 30 years, often have long-term warranties, while pricing depends on several factors, like the type of house and roof, and the size and type of solar PV system.

For homeowners, installing solar panels typically costs between RM16,000 and RM46,000, while industries might need a larger investment. It is also estimated that the return on investment on installations takes between six and ten years.



However, when choosing between solar panel providers, consumers must always be on the lookout for low-grade or refurbished solar panels that will result in shorter lifespans, or subpar electrical cables that could deteriorate from prolonged exposure to ultraviolet rays.

Malaysia’s abundant sunlight throughout the year, with high irradiance levels, is certainly advantageous for solar energy adoption. Transitioning to solar energy will also reduce dependence on fossil fuels and contribute towards addressing climate change, environmental sustainability and energy security.

As technological advances and awareness grow, it becomes evident that solar power will play an increasingly vital role in Malaysia’s energy mix. Best yet, solar energy may save electricity bills by up to 90%.

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Source: https://www.freemalaysiatoday.com/category/nation/2024/10/02/the-rising-power-of-solar-energy-in-malaysia/