Solar photovoltaic in Malaysia: The way forward

• Published in: Renewable & sustainable energy reviews 2012-09, Vol.16 (7), p.5232-5244
• Main Authors: Muhammad-Sukki, Firdaus, Munir, Abu Bakar, Ramirez-Iniguez, Roberto, Abu-Bakar, Siti Hawa, Mohd Yasin, Siti Hajar, McMeekin, Scott G., Stewart, Brian G.
• Format: Article
• Language: English
• Subjects: Applied sciences; banking; business enterprises; capital; Energy; Exact sciences and technology; Feed-in tariff; funding; homeowners; households; Interest rate; issues and policy; loans; renewable energy sources; rural areas; Solar energy; Solar photovoltaic; sustainable technology; tariffs
• ISSN: 1364-0321; 1879-0690
• DOI: 10.1016/j.rser.2012.05.002

This paper examines solar photovoltaic (PV) in Malaysia. First, it analyzes the current energy demand in Malaysia and discusses some of the national policies and the installations of solar PV in urban and rural areas in the country. Next, the general Feed-In Tariff (FiT) scheme is explained, indicating its potential as one of the investment options for Malaysians. Finally, the loan financing option for solar PV is presented, providing examples that have been implemented in other countries, as well as explaining the Green Technology Financing Scheme (GTFS) for companies and the proposed soft loan scheme for individual households in Malaysia. It also analyses the impact of the proposed interest rate to household consumers in Malaysia, in terms of total profit, net present value and internal rate of return. It is found that the FiT scheme could potentially help in increasing renewable energy penetration, particularly for solar PV. To provide upfront capital for solar PV installation, it is shown that the GTFS is a good financial source for companies while for individual home owners, a soft loan facility from banking institutions is a feasible source if the interest rate is 5% or less.