Malaysia’s solar sector on the rise

Malaysia’s solar photovoltaics (PV) industry is on the rise thanks to strengthening government support, growing investor confidence and reducing costs.

Already ASEAN’s biggest solar PV employers, Malaysia’s solar sector is well poised for more growth given the favourable conditions that are developing.

Besides having relatively high irradiation levels, Malaysia already has an established solar manufacturing sector, although most of the solar equipment used is exported at present.

“The expanding domestic manufacturing base for renewables components will ensure that there is a reliable and low-cost supply chain for project developers amid global falling technology costs,” noted Fitch Solutions Macro Research in a report last month.

“We believe that this will be a key supportive factor to the Malaysian solar industry over the coming year, as greater numbers of manufacturers set up in the country,” added the credit rating agency.


Renewable energy is being promoted at the highest levels of government, and speaking at an environmental event on the side-lines of the United Nations General Assembly (UNGA) in New York last week, Malaysian Prime Minister Dr Mahathir Mohamad promised that current incentives and tax breaks such as the Green Technology Financing Scheme and the Green Investment Tax Allowance will be continued to spur further development in the renewable energy sector.

Such policies are needed if Malaysia is to achieve the ambitious target of increasing its energy generation mix from renewable energy from two percent in 2018 to 20 percent by 2025 as announced by the Energy, Science, Technology, Environment and Climate Change Ministry last September.

Malaysia has the potential to generate more than enough electricity to meet its current demand if all the roofs in Peninsular Malaysia are fitted with solar panels.

There are over 4.12 million buildings with solar rooftop potential in the peninsular (West Malaysia) said Malaysia’s Energy, Science, Technology, Environment and Climate Change Minister, Yeo Bee Yin in May, and they could generate 34,194 megawatts (MW) of electricity if they are fitted with solar PV systems. The country’s total electricity production currently stands at an average of 24,000 MW.

Concept of NEM
Source: Sustainable Energy Development Authority (SEDA)
The revised Net Energy Metering (NEM) scheme has also been received well, and a total of 16.6 MW of NEM was approved by industry regulators Sustainable Energy Development Authority (SEDA) in the first four months of 2019 compared to 18.24 MW in 2018.

Since the NEM’s introduction in 2016, solar power producers would sell excess electricity to Malaysia’s largest electricity utility company, Tenaga Nasional Berhad (TNB), at RM0.31 pkWh (US$0.07 per Kilowatt per hour) and purchase it at about RM0.50 (US$0.11) pkWh.
But since 1 January, the sale and purchase prices of electricity under the NEM has been at the same price – a move aimed at improving solar PV’s return on investment.

Reduced cost

As it is, solar energy has now become cheaper than gas-generated power thanks to advances in technology.

The government of Malaysia opened bids for an estimated RM2 billion (US$477 million) worth of projects under the third round of the Large-Scale Solar (LSS3) scheme in February, and speaking to local media last month after the bidding process ended, Yeo revealed that the first four projects – 365 MW out of 500 MW – were actually bid below the gas-generation price of RM0.2322 (US$0.0554) per kWh.

“In the second round of LSS bidding (in 2017), RM0.32 (US$0.0763) per kWh was the lowest price; that became our reference price when we opened LSS3 for bidding this year. But when the bidding exercise closed, the lowest bid was at RM0.1777 per kWh (US$0.0424),” she said.

“That is a 45 percent reduction in just a few years. That is why we are very confident that the renewable energy price will reach parity (with that of gas) in the foreseeable future,” she added.


Businesses and investors have taken note of this, and SEDA approved 17 solar investor applications in the first three months of this year alone.

Yesterday, CIMB – one of the country’s largest banks – announced it had allocated RM100 million (US$23.9 million) to its renewable energy financing scheme for small and medium enterprises (SMEs), and one of its main initiatives is to provide companies with 100 percent financing to cover the cost of solar PV systems and installation on their rooftops in support of the NEM scheme.

“Our planet is at a tipping point from an environmental, economic and social (EES) perspective, and we must take action now … to begin pursuing profits with a purpose,” stressed CIMB Group CEO, Zafrul Aziz.

On 19 September, Mydin Mohamed Holdings Berhad (Mydin) became the first chain retailer in Malaysia to install a solar PV system at its outlet in the city of Ipoh, in the northern state of Perak. They expect the 324 kilowatt-peak (kWp) solar PV installation in the department store to save up to RM3.24 million (US$773,000) in electricity bills throughout its 25-year lifespan.

In June, the Seberang Perai Municipal Council (MPSP) in the northern state of Penang became the first municipal council in the country to choose solar energy generation by installing solar panels on the rooftops of public markets and some state government offices.

With TNB proposing an internal restructuring of its generation, transmission and retail divisions – which is expected to be completed in the third quarter of 2020 – the increasing liberalisation is set to improve competition and grow investments in the solar PV sector.


CIMB joins 130 banks worldwide on responsible banking

CIMB Group Holdings Bhd today became one of the Founding Signatories of the United Nations Environment Programme Finance Initiative UNEP-FI Principles for Responsible Banking.

According to one of the largest banking group in Asean, the initiative demonstrated CIMB’s strong commitment to strategically align its business with the UN’s Sustainable Development Goals and the Paris Agreement on Climate Change.

“As a founding member of the UNEP-FI Principles for Responsible Banking, we are convinced that only in an inclusive society, founded on human dignity, equality and the sustainable use of natural resources, can our employees, customers and other stakeholders thrive,” CIMB group chief executive officer Tengku Zafrul Aziz said in a statement.

“By signing the Principles, we commit to using our products, services and relationships to support and accelerate the fundamental changes in our economies and lifestyles necessary to achieve shared prosperity for both current and future generations,” Tengku Zafrul (on left in photo below) said.

As a signatory of the Principles for Responsible Banking, CIMB joins a coalition of 130 banks worldwide, representing over US$47 trillion (RM196.16 trillion) in assets, committed to playing a crucial role in achieving a sustainable future.

Taking place at the start of the UN General Assembly, the official launch of the Principles for Responsible Banking marked the beginning of the most significant partnership to date between the global banking industry and the UN.

“The UN Principles for Responsible Banking are a guide for the global banking industry to respond to, drive and benefit from a sustainable development economy.

“The Principles create the accountability that can realise the responsibility and the ambition that can drive action,” said UN secretary-general Antonio Guterres at the launch event, attended by the 130 Founding Signatories and over 45 of their CEOs.

The statement noted the Principles for Responsible Banking is supported by a strong implementation and accountability framework.

By signing it, CIMB is committed to being transparent on both its positive and negative impact on people and the planet.

The Principles for Responsible Banking will also provide CIMB with an effective framework to systematically identify and seize new business opportunities created by the emerging sustainable development economy and enable the bank to identify and address related risks.

Under its current strategic sustainability growth plan Forward23, CIMB has begun engaging with regulators, investors, customers, suppliers, employees and communities to create a more sustainable and resilient future for all.

CIMB will also be hosting “The Cooler Earth”, its inaugural sustainability summit, on Oct 1-2, 2019, to be held in Kuala Lumpur.


Putrajaya to review carbon emission commitments next year

KUALA LUMPUR (Oct 1): The government is looking to review its carbon emissions commitments under the 2016 Paris Agreement.

Speaking at CIMB Group Holdings Bhd’s The Cooler Earth Sustainability Summit, Minister for Energy, Science, Technology, Environment and Climate Change Yeo Bee Yin said the government would be reviewing its national determined commitment under the Paris Agreement.

“Our national determined commitment [under the Paris Agreement] is a 45% reduction in carbon emissions intensity relative 2005. This means by 2030, we want to reduce our carbon emission intensity, which means carbon emissions relative to gross domestic product, to 2005 levels,” Yeo said.

The review will take place at the next United Nations Framework Convention on Climate Change next year.

As of today, Malaysia has reduced its carbon emissions intensity rate to 33%. The minister noted that Malaysia is at a comfortable level with its ability to meet the 45% target, and that the emissions target could be raised.

With regard to the global fight against climate change, Yeo emphasised that while it is everyone’s responsibility to combat climate change, there must be common but differentiated responsibilities.

“This means that more developed countries have to play their part in assessing climate change as well. If you want less developed countries to do more, you have to give them the assistance to do so,” she said.

Malaysia entered the Paris Agreement in 2016.


CIMB launches RM100m green energy financing for SMEs

KUALA LUMPUR: CIMB Group Holdings Bhd has launched RM100 million in financing for small and medium enterprises (SMEs) to acquire and instal renewable energy technology, as part of its RM15 billion SME allocation for 2019–2020, and the group’s sustainability commitment.

Among the first initiatives of this programme is to provider smaller SMEs with 100% financing to cover the cost of solar photovoltaic systems and the installation of these on their rooftops, according to a statement from the group.

The financing initiative offers packages from as low as RM20,000 and up to RM1 million, and is in support of the government’s Net Energy Metering (NEM) scheme.

“With the CIMB Renewable Energy Financing, we are pleased to be able to incorporate environmentally friendly policies into our commitment to the SME sector. Our planet is at a tipping point, from an environmental, economic and social (EES) perspective, and we must take action now. To that end, members of the banking and finance industry can and must leverage on our resources and network to catalyse real lasting change across these fronts, and to begin pursuing profits with a purpose,” said the group’s chief executive officer Tengku Datuk Seri Zafrul Aziz.

The initiative was announced by Tengku Zafrul at the start of the group’s two-day “The Cooler Earth Sustainability Summit” yesterday. Undertaken in partnership with the Sustainable Energy Development Authority (Seda), SMEs will first need to obtain NEM approval from Seda to be eligible for the scheme.

When met on the sidelines of the conference, Tengku Zafrul said an applicant’s financing needs will be assessed on a case-by-case basis. “We have to see the amount requested in relation to the size of the SME,” he said.

When asked why the banking group is launching the financing scheme now, Tengku Zafrul reiterated that the move is part of CIMB’s sustainability agenda, under which the group has also offered lower finance costs for hybrid car loans and loans for green building index houses and buildings.

“This is to encourage people to take sustainability issues more seriously, and to make it more commercially viable for them,” he added.

On that note, Tengku Zafrul said the group hopes the government would announce tax incentives in the upcoming Budget 2020 to further encourage the development of sustainable technology. He also said more measures are needed to help improve education opportunities of the country’s bottom 40% income group, the B40 segment.

Meanwhile, Energy, Science, Technology, Environment and Climate Change Minister Yeo Bee Yin, who was present to launch the summit yesterday, lauded and welcomed CIMB’s green financing announcement, saying it would allow more businesses to engage with renewable technology, thus making it more accessible to more people.

The summit, which ends today, is CIMB’s first regional platform to raise awareness of social and environmental risks, as well as opportunities within the context of business and finance in shaping a sustainable economy. It is organised in collaboration with the WWF and sustainability consultancy, Impacto.


Google green energy buys boost ‘carbon-free’ portfolio

SAN FRANCISCO: Google on Thursday announced a record-high boost to its green electricity purchases, saying the deals will spur construction of millions of solar panels and hundreds of wind turbines.

The US-based internet giant increased its wind and solar energy portfolio by more than 40 percent with deals for 1,600 megawatts of electricity.

“Once all these projects come online, our carbon-free energy portfolio will produce more electricity than places like Washington, DC or entire countries like Lithuania or Uruguay use each year,“ Google chief executive Sundar Pichai said in a blog post.

Pichai touted the combined new deals and agreements as the biggest corporate purchase of renewable energy in history.

Google’s worldwide portfolio of wind- and solar-generated electricity agreements total 5,500 megawatts, which was described as the capacity of a million solar rooftops.

In 2017, Google became the first company of its size to offset its entire annual electricity consumption with renewable energy, and repeated the feat the following year, according to Pichai.

“As a result, we became the largest corporate buyer of renewable energy in the world,“ he said.

As internet services and computing hosted in the cloud are increasingly woven into users’ lifestyles, demand for power climbs at data centers handling the computing.

Google’s latest green energy deals include investments in Chile, Europe and the US.

Pichai also announced two new grants from its philanthropic arm,, to support organisations that improve access to clean energy for all businesses. will back a US$500,000 (RM2 million) grant to Renewable Energy Buyers Alliance in the US and a 500,000 euro (RM2.3 million) grant to RE-Source in Europe.

“These are just a few of the ways we’re working to tackle climate change at a global scale,“ Pichai said.

“Our goal is to make sure technology can benefit everyone — and the planet we call home.” — AFP