Solar Attracts Large Investments To Malaysia

In 2016, Malaysia attracted seven solar manufacturing projects and 83 solar energy projects. With approval from the Malaysian Investment Development Authority (MIDA), the country had solar investments of 2.42 billion RM ($545 million) last year.

While solar manufacturing made up 1.77 billion RM ($398.9 million) worth of investments, solar energy projects attracted 0.65 billion RM ($146.5 million). “The biggest investment was contributed by Longi, a major solar giant producing solar ingot, wafer cells and modules; other investments approved include Jinko Solar and JA Solar which will be undertaking expansion and diversification activities,” said Dato’ Azman Mahmud, CEO of the Malaysian Investment Development Authority (MIDA).

Longi will be working on its 1.06 billion RM ($238.9 million) plant in the Sama Jaya Free Industrial Zone in Sarwak, which will reportedly lead to 2,360 new jobs. The Chinese integrated PV company bought all equipment and related assets of Comtec Malaysia’s monocrystalline silicon wafer production facility.

Foreign investment forms a big chunk in the Malaysian solar PV industry. In 2015, the country saw 48 solar power projects being implemented with a total investment of 28 billion RM ($631 million). Of this, foreign investments comprised 95.3%, only 4.7% came from domestic sources. A MIDA survey show the export activities undertaken by top solar companies in 2016 amounted to 11.1 billion RM ($250 million). Local sourcing activities in the same year were worth 1.42 billion RM ($320 million).

“While a comprehensive ecosystem is a magnet for investors, we are aware that a strong supply chain is also crucial to support the industry to maintain a conducive business environment,’ said Mahmud, adding, “Towards this goal, we are building up local capabilities to develop further in areas such as system integration and the balance of system components, which are important parts of the PV system value chain.”

To boost the solar energy capacity in the country, the Malysian Government introduced two new policies in 2016 to scale up the generation of renewables. The policies are namely net energy metering and large scale solar mechanisms. The government believes this two initiatives will contribute an additional 1,500 MW of renewables by 2020.

However, according to Malaysia’s solar industry roadmap, which was presented at last year’s IGEM conference in Kuala Lumpur, the solar targets are higher – between 1.95 GW of installed PV in a business-as-usual scenario and 2.4 GW in an accelerated scenario by 2020.

The Malaysian Energy Commission recently launched a second large scale solar PV tender (see Malaysia Launches 460 MW PV Tender).