Increase solar Net Energy Metering quota to 2,500MW for 2021-2030

Rooftop solar struggled to take off under Malaysia’s Net Energy Metering (NEM )1.0 because under this policy we were paid RM0.30 per kWh fron solar electricity but charged at a higher tariff for consumption. The NEM 2.0 introduced in 2019 increased the adoption of rooftop at an unprecedented rate.

NEM 2.0 offsets every 1kWh exported to the grid against 1 kWh consumed from the grid from the highest to the lowest tariff. The announcement of NEM 2.0 in late 2018 boosted solar adoption even before it commenced.

Nearly 90% of all rooftop solar was installed after NEM 2.0. It is estimated that the quota for period 2015-2020 will be exhausted by the end of this year.

Hence, it is time to review and increase the Solar NEM for period 2021-2030 to match rising adoption. Without utility scale batteries, solar penetration must be capped at 24% peak demand for grid stability.

The peak demand estimated by the Energy Commission (Suruhanjaya Tenaga) for 2030 will be 22.8GW allowing nearly 5.5GW of solar power. Collectively, NEM (2015-2020) and Large-Scale Solar (LSS 1-4) already supplies 3GW of solar power leaving room for another 2.5GW.

Assuming no grid limitation the project demand for NEM (2021-2030) is 5.2GW which more than twice the available capacity. Hence, the whole 2.5GW solar capacity should be allocated for rooftop solar under NEM (2021-2030). Government should not allocate anymore solar quota for Large Scale Solar.

Installation of rooftop solar produces and sustains more domestic jobs per kWh than large scale solar. Rooftop solar reduces the peak demand from commercial buildings onto the transmission grid. This delays costly transmission upgrades and reduces pressure to increase the electricity bill for the whole Peninsular Malaysia.

Large scale solar consumes vast amounts of fertile land while guaranteeing easy and fixed profit for the capitalists. The government should focus instead on developing other lagging renewable energy sources such as biogas, mini-hydro, offshore wind farms etc.

Issued By:

Central Committee
Bureau for Environment & Climate Crisis
Parti Sosialis Malaysia (PSM)

State Secretary
Parti Sosialis Malaysia
Negeri Melaka (PSM Melaka)

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