NEM (Net Energy Metering) 3.0

NEM 3.0 or Net Energy Metering 3.0, has been announced by KeTSA (Kementerian Tenaga dan Summer Asli). In total, NEM 3.0 will have a quota of 500 MW until 2023. Full details are yet to be given. Find out more.

Yes, as long as you are a customer of TNB/SESB. The basis is always your electricity bill. Please ensure you are a registered customer of TNB/SESB (your name/ company as appeared in the TNB/SESB bill), only then you are eligible to participate in NEM.

In replacement of the Feed-in-Tariff (FiT) (registration ended in 2016), the NEM or Net Energy Metering allow owners of a solar photovoltaic (PV) system to export excess generated energy to the distributor license-TNB. The excess energy can be put to good use by generating credits to offset the monthly electricity costs. These credits are eligible for a rollover of up to 24 months but cannot be compensated in the form of cash.

Since 1st January 2019, the NEM policy has been revised to enable these credits to be calculated on a one-to-one basis. The rate which is compensated for the exportation of energy is the same as the tariff rate, instead of the old displaced cost mechanism at a lower prevailing rate.

This move serves to benefit owners by allowing more economic benefits in the exportation of energy. The NEM policy is only applicable in Peninsular Malaysia.

Yes, as long as he/she/it is a customer of TNB/SESB.

The NEM contract shall be effective on the day of NEM contract signing with both parties. The NEM contract shall remain in effect unless otherwise terminated by either party or cancellation of the main electricity contract.

2 types of meter are required as below:

  • TNB/SESB’s bi-directional meter (with import-export feature) to record the amount of electricity consumed, produced or exported;
  • PV meter/data logger/inverter with monitoring feature to record the total amount of electricity generated by the PV system. Optional – May install check meter for measurement of the energy export (if applicable) and shall be of the same or equivalent to the standards of the consumer meter installed at the premises by TNB/SESB.

Solar PV System

Our solar PV system ranges from a minimum of 4kW to a maximum of the roof area. Every customers’ requirement is different in terms of budget, energy consumption and roof space area. Find out more.

A 4kW system would require an estimate area of 400 sqft. Find out more.

The solar PV system is designed to maximise ROI, hence most or all energy generated will be fully consumed by the consumer. Any excess shall be sold to the grid under the Net Metering Scheme. Learn more about Net Metering here.

The excess energy will be credited in your usual utility bill. The credit (excess energy) to NEM consumer will be based on prevailing Displaced Cost for the relevant supply voltage level at the Point of Common Coupling.

The calculation for the net billing of electricity will be based on the following calculation:

Net billing = [Energy Consumed from DL (kWh) x Gazetted Tariff] – [Energy Exported to DL (kWh) x Displaced Cost]

Solar PV systems are designed to last more than 20 years. The solar panels have a performance warranty of 25 years guaranteed by the solar panel manufacturers..

Only minor maintenance works are required which are the cleaning of the solar panels and routine performance checks on the provided cloud based remote monitoring system. If requested, we do provide an optional service for the routine maintenance.

Power outages do not affect the solar PV system. So long there is sunlight shining onto the system, it generates energy.

Financing

Yes. Most commercial banks and leasing companies do provide financing packages for solar PV systems.

The payback period of system owners is dependent on the policies, tariff rate and tax allowances that each business owner is entitled to.

In combination of the Green Investment Tax Allowance and Capital Allowance, owners of a clean energy system who qualify for this tax relief, can realize a potential payback period of 3-6 years, depending on tariff rate in effect.

If you are a homeowner, the payback period is estimated to be about 7-11 years. This depends on the amount of energy currently being used by the household due to the tiered tariff rate for residential properties.

The government set up the GTFS (Green Technology Financing Scheme) in 2010, to support the development of Green Technology projects. Green Technology projects that need financing facilities will enjoy a rebate of 2.0% from their approved rate of interests by financial institutions.

It is a government scheme set up in 2010 to support the development of green technology projects. Green Technology projects which require financing facilities will enjoy a rebate of 2% from their approved rate of interests by financial institutions. In a solar power industry context, this loan incentive is currently applicable only for Large-Scale Solar (LSS) projects.

The LSS programme is conducted by Energy Commission (EC), an agency under the Ministry of Energy, Green Technology and Water (KETTHA). It is an Independent Power Plant (IPP) government tender which can be participated by the private sector. Under the Large-Scale Solar (LSS) programme, the license holder is protected under The Renewable Energy Act 2011 (RE ACT) and Power Purchase Agreement (PPA). The PPA is a power sale contract binding the license holder and Malaysian utility company, Tenaga Nasional Berhad (TNB) for 21 years.

Investment Tax Allowance (ITA) of 100% of qualifying capital expenditure incurred on a green technology project from the year of assessment 2013 (date on which the first qualifying capital expenditure incurred is not earlier than 25 October 2013) until the year of assessment 2020. The allowance can be offset against 70% of statutory income in the year of assessment. Unutilized allowances can be carried forward until they are fully absorbed.

Green technology project related to renewable energy, energy efficiency, green building, green data centre, and waste management can qualify for this tax incentive. Please refer to the Guideline for Application for incentives and/or Expatriate Posts for Green Technology (GT) at www.mida.gov.my for more details.

Capital allowances are deductions claimable for the wear and tear of qualifying fixed assets such as industrial machinery, office equipment and sign boards. Under Capital Allowance, Solar PV system could categorized as Plant & Machinery and is eligible for depreciation over the period of 6 years.

It comprises the following types of provisions:

  • Initial allowance 20% (IA – for the first year allowance)
  • Annual allowance 14% (AA – for subsequent years until the full amount is availed)
  • Balancing allowance
  • Balancing charge

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