Malaysia Corporate Solar PPA 600MW Quota Application Open from 7 Nov 2022

October 31, 2022 17:00 pm +08 

KUALA LUMPUR (Oct 31): Ministry of Energy and Natural Resources (KeTSA) released a Media Statement regards to CORPORATE GREEN POWER PROGRAM (CGPP) to support the country’s Green Economy Development Policy. If you wish to find out more information, do not hesitate to click on the Whatsapp or Contact link and get in touch with Maqo.

Maqo Spritzer Rooftop Solar Malaysia NEM

Together with the world’s leading companies and conglomerates that committed to the RE100 Initiatives, Malaysia aware the importance of decarbonization and reduce the carbon footprint and fight climate change with more green electric power, renewable energy and solar power.

Currently, Malaysian companies can fulfill their green electricity use commitment through the installation of solar photovoltaic (PV) systems on building premises through the Net Energy Metering (NEM) and Self Consumption (SelCo) Programs. In addition, companies can also purchase a Renewable Energy Certificate (REC) / Sijil Tenaga Boleh Baharu (TBB) or purchase Green Electricity Tariff (GET). 

Following the growing demand for green electricity supply, existing programs and initiatives are expected to be unable to meet the demand. Therefore, the Government introduced the Program Tenaga Hijau Korporat (PTHK) or Corporate Green Power Program (CGPP) which uses the Virtual Power Purchase Agreement (VPPA) mechanism with a quota of 600MW, to allow corporate companies operating in Malaysia to achieve their Environmental, Social and Governance (ESG) commitments. 

 

Under the CGPP program, eligible corporate entities can enter into PTHK Agreement with a Solar Power Generator for the sale and purchase of REC (TBB) under mutually agreed terms and conditions. The PTHK is a bi-lateral financial hedge agreement that details the agreed pricing structure between the corporate entity and the solar power generator based on the value or financial benefit available through reduced green house gas (GHG) emissions from the solar generation.

 

The sealing of a financial hedge contract between a corporate company and a solar power generator will allow corporate companies to obtain green electricity supply virtually at a fixed price for a long period and also obtain a Renewable Energy Certificate (REC) from solar power generators to enhance its ESG commitments.

 

This new mechanism is called Virtual PPA (VPPA) because this green electricity supply does not involve the continued physical distribution of electricity supply by the solar power provider to the company. Instead, the electricity supply is still distributed as usual by Tenaga Nasional Berhad (TNB) through the existing electricity supply system and infrastructure. The details of the implementation structure of the VPPA mechanism are as follows:

 

 

 

malaysia VPPA PTHK Virtual Solar PPA TNB NEDA Single Buyer Maqo

Above Diagram and Picture illustrates the Financial Transaction of the Green Solar Electricity Energy Flow vs the Electricity Tariff and SMP price flow in a Virtual Power Purchase Agreement (VPPA) and CGPP Program

 

Applications for participation in the CGPP program will be open from 7 November 2022 to 31  December 2023 or until all available quotas are fully distributed, whichever is earlier. 

All solar energy generators approved for implementation under this program must be completed and start operating by 2025.

 

The introduction of this new CGPP program will ensure Malaysia to achieve our renewable energy capacity mix to 31% by 2025 and 40% by 2035, as well as enable carbon footprint reduction of 701,000 tCO2 per year to be achieved. 

The implementation of this project will bring approximately RM 2.0bilion of investment and create 7,200 new job opportunities in Malaysia Renewable Energy & Solar Industry.

If you wish to find out more information, do not hesitate to click on the Whatsapp button or Contact link and get in touch with Maqo.

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