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You’ve got spare land or a nice, wide roof… what are you planning to do with it? You could just let it sit there, you know, do its own thing.
OR you could opt to convert it into an awesome self-generating power device to save electricity in your home! That’s what home solar offers to residents in Malaysia.
According to Malaysia’s Minister of Energy, Science, Technology, Environment and Climate Change (MESTECC), there are over 4.12 million buildings with solar rooftop potential in Peninsular Malaysia alone.
If every one of those rooftops had rooftop solar installed, Malaysia could generate more than its current total electricity generation every year. That’s an electrifying idea!
So let’s explore solar panels in Malaysia, the price, what solar panel might be best, and everything else you need to know.
What Is Solar Power?
Let’s start at the top! It begins with the sun. Solar panels generate power by absorbing light from the sun in photovoltaic cells, Transforming that energy into electricity.
That’s why solar power also goes by the label ‘solar PV’. The PV stands for 'photovoltaic'.
Source: The Asean Post
The first solar panel was invented almost two centuries ago, and solar PV has become increasingly efficient and commercially attractive over the last few decades.
In the 1950s to 1960s, solar panels were just 10% efficient, meaning ONLY 10% of the energy absorbed from the sun was converted into electricity.
Nowadays, solar panels can convert around 20% of the energy. If that doesn’t sound like a lot, remember: You don’t have to pay for sunlight!
Solar power generated at home can save you cost on electricity, as you source and consume electricity on your own, rather than buying it from the grid.
The excitement doesn’t stop there – you can even apply to SELL that energy back to Tenaga Nasional Berhad (TNB) or Sabah Electricity Sdn Bhd (SESB).
You can do this through Malaysia’s Net Metering Scheme. The scheme is an initiative designed to reward both domestic and commercial solar power generators, by selling any extra renewable energy back to the electricity grid.
Now, that’s a very green way to earn some money! There's a total quota of 500MW for domestic Net Metering accounts, up to the year 2020.
Recent Changes To Solar Power In Malaysia
There've been some exciting new changes to solar power in Malaysia that make it an interesting option, if you’re one of the 3.2 million residential homes in Malaysia lucky enough to have space for rooftop solar.
1) Net Metering
Changes here have increased the price paid to generators for the power they sell back to the grid.
The practice is now on a ‘one-to-one basis’, meaning every unit of power you sell to the electricity grid earns the price of what one unit of power from the grid would cost.
That’s a significant boost to your potential earnings, while also creating a greener home. It’s not just residents in Peninsular Malaysia who can benefit; the Net Metering was also extended to Sabah in 2019.
2) Peer-to-peer or P2P
This type of electricity market was also under trial in Malaysia in 2020.
If you’re generating electricity at home, you might be able to sell it directly to your neighbours in future via the TNB grid!
That means you get to live in a much greener neighbourhood together, and make money with some sustainable solar panels.
What Is The Solar Panel Price In Malaysia?
There’s no clear and easy answer to the question of solar panel price in Malaysia, unfortunately.
The pricing can depend on the installation’s size, the solar panel’s quality, and the particular scheme or company that you engage for the service.
Analysts suggest that a standard residential installation could vary from 4kW to 12kW, with costs ranging from between RM16,000 to RM23,000 for a basic system of 3kW.
Thanks to the Net Metering’s latest changes, that could repay itself in as little as five years in the right circumstances!
There are also options to ‘lease’ solar panels from registered providers, allowing you to install them at a low upfront cost, paying the company over a period of time instead.
It’s also worth checking in with your banks for major green deals. United Overseas Bank, for one, became the first to offer a sustainable energy financial solution.
They have the 'U-Solar initiative', offering 36-month interest-free loans for residential customers looking to install solar panels.
U-Solar also offers partners with a range of installers and suppliers in providing zero upfront costs for assessment, installation and maintenance.
Where To Buy Solar Panels?
You don’t have to worry about some sort of Wild West of energy traders attempting to sell solar panels off the back of a lorry!
The Sustainable Energy Development Authority (SEDA) Malaysia has a helpful list of accredited and registered companies selling solar equipment to check out.
Suppose you’re looking for where to buy solar power in Malaysia, while also remaining economical. In this case, it’s good to remember that renewable energy and solar panel markets are changing rapidly.
Always check for the latest financing offers from banks or the government before you commit.
Going solar is not only limited to personal homeowners. Having recognised the importance of sun-sourced power, Hong Leong Bank has also recently unveiled its new solar financing programme for small to medium enterprises (SMEs) looking to operate more sustainably.
Now, the cost to install photovoltaic panels would depend on the type of home you own. Yes, whether your house is a landed property or located in a high-rise building is a factor!
Generally, it is technically and legally easier to install solar panels on a landed house rather than an apartment/condominium.
For one, a high-rise building is shared with other owners and then governed by specific laws around stratified, or shared, properties. That said, it’s not at all impossible.
If you own a landed property, chances are that you can just undertake solar installation using your own initiative. If you own a stratified property, you’ll have to work through the Joint Management Body or Management Corporation.
Ensure that you’re eligible for the installation with the two-part steps below:
Step 1: Pre-installation planning
- You are already a registered TNB customer;
- You have enough land and roof space to accommodate solar panel equipment;
- Your roof is sturdy enough, leak-proof, and can provide approximately 6.27 sq ft of roof space for each 1kW of electric generation;
- Your home as a dry, safe space to store your panels’ batteries.
The process of going solar doesn’t end there; you still need to ensure that your solar panel instalment and usage abide by the laws regulated by local authorities.
To do so, you have to apply to receive the Feed in Approval (FIA) for solar PV installation.
Step 2: Submitting your application to authorities:
- You have researched and understood all information on solar panel equipment, installation methods, and electricity generation plans;
- You have understood details outlined by SEDA, such as the rules and regulations around the Feed in Tariff (FiT) in Malaysia and the RE quota;
- Submit your application forms either manually (in person) or online.
|Note of assurance: SEDA is a great place to start as the gatekeeper of all that is sustainable in Malaysia. Check the accredited companies list and the latest announcements around net metering and solar power to understand what’s available.|
Once your application is approved, you will:
- Sign the Renewable Energy Power Purchase Agreement with your Distribution Licensee;
- Register the signed agreement with SEDA;
- Review and sign the financial agreement the required conditions to the first drawdown;
- Allow your service provider to install your solar PV panels and FiT meter;
- Complete the following Acceptance Test assigned by the hired certified expert;
- Proceed to engage SEDA and your Distribution Licensee about the progress, focusing on details such as your commencement date, duration, and monthly payment details;
- And receive your FiT monthly payment from your Distribution Licensee after 30 days based on the FiT meter’s reading.
What Are The Pros And Cons Of Solar Panels?
Did you know that analysts estimate there will be more than 100 million rooftop solar panels installed globally by 2024!? That’s a whole lot of rooftop sustainable energy to be generated!
So, the question is whether home solar panels are a good idea in Malaysia? Let’s look at the potential benefits and challenges:
What are some pros of home solar panels?
1) Cheaper electricity bills
While the upfront costs aren’t meagre to say the least, a solar-powered home will pay off for you in the long run. To be exact, you have the potential to save up to 80% of your monthly power expenditure.
2) Reduced carbon footprint
Sunlight is endlessly renewable, but fossil fuels aren’t. Using solar power at home means you significantly reduce your CO2 emissions and carbon footprint.
3) Potential ROI as soon as five years
Despite expensive panels and installation, maintenance is low-effort and low-cost. Not only will you break even within a few years, you can potentially profit from selling excess energy back to the grid through the Net Metering system. Solar panels will also add to the value of your property.
4) Take advantage of green incentives and financing
There are various incentives and financing options aimed to help ease the upfront burden. Financing-wise, UOB’s U-Solar programme helps you pay for your solar package over 12, 18, 24 or 36 months with 0% interest on your UOB credit card*.
While solar tax incentives are still lacking on the residential front, the commercial front sees plenty through the Green Technology Financing Scheme.
5) Possible to earn positive profits
The Net Metering (NEM) and P2P schemes mentioned above provide channels for you to generate profit from selling off excess energy to TNB - so you don’t have to install expensive battery storage.
The quota for NEM 3.0 is 100MW now, and applications can be submitted to SEDA until 31st December 2023.
6) Play your role in Malaysia’s renewable energy targets
With renewable energy efforts gaining more traction worldwide, Malaysia’s renewable energy target has been set at 31% by 2025. Installing solar panels at home helps you do your part in contributing.
What are some cons of home solar panels?
1) Understanding the landscape can be complex
It isn’t as simple as installing solar panels and putting your feet up. To take full advantage and see the most ROI, you’ll have to do your research.
2) Don’t forget about maintenance
While solar panel systems don’t require a whole lot of maintenance, you want to make sure your provider will be together with you every step of the way. Note that some providers only offer warranty if the system is installed by their own staff.
3) Investment return timetables are not guaranteed
Your provider will likely offer an estimate for you, but making sure you achieve your ROI as expected will depend on many variables.
Among these include the weather, your household’s energy consumption and possible faults in your solar panel system.
4) You can only earn money from selling excess electricity
Many Malaysians are mistaken that installing a solar panel system is a promising opportunity for passive income.
Note that the NEM scheme operates on a first come first serve basis due to its quota, and should only be viewed as a means to offset your electricity bills.
5) It’s not an end all be all
The peak hours in which the most solar power is converted are the hours in which most of us are out at work.
This means that conventional energy is still needed to an extent, unless you have a solar battery (which comes with its own costs).
Benefits of home solar
Drawbacks of home solar
Cut down on your electricity costs at home.
Can be complex understanding the landscape of costs and savings.
Generate clean electricity that reduces the need for fossil fuels.
Technology does require maintenance, although this should be part of a good setup agreement.
Potential return on investment as quickly as five years.
Investment return timetables are not guaranteed, and can take longer to earn back your initial spend.
Incentives and financing can significantly reduce or eliminate upfront costs.
You can only earn money from selling excess electricity, not all electricity generated.
Possible to earn positive profits once the investment costs have been paid off.
It’s not an end all be all
Help contribute towards Malaysia’s renewable energy targets.