Govt retains offset mechanism for excess rooftop solar energy

THE government will maintain the offset mechanism for excess solar energy generated by over 96,000 existing users under two major rooftop solar initiatives — the Malaysia Building Integrated Photovoltaic (MBIPV) programme and the Net Energy Metering (NEM) scheme.

According to the Ministry of Energy Transition and Water Transformation (PETRA), more than 82,000 operational solar PV systems with a combined capacity of 1.7 gigawatts (GW) are currently in place, with an additional 14,000 systems totalling 595 megawatts (MW) under development.

PETRA said the continuation of the offset mechanism is aligned with the implementation of a new, more transparent and progressive electricity tariff structure that takes effect today.

“As part of this adjustment, MBIPV and NEM users will continue to receive energy credits under updated guidelines according to user category and varying offset durations,” the ministry said in a statement.

MBIPV users will receive energy, network and capacity credits for five years until 31 December 2030, while NEM 1.0 users will continue to enjoy offset based on displaced cost for 10 years until 31 December 2035.

NEM 2.0 and NEM 3.0 users, meanwhile, will receive energy, network and capacity credits for 10 years from the date their solar PV system was installed.

PETRA noted that the rates and calculations for these incentives will be adjusted accordingly to ensure fairness across all electricity users and equitable treatment for MBIPV and NEM participants eligible for energy efficiency or related incentives.

“In addition, to standardise the implementation of the offset mechanism across all rooftop solar programmes under PETRA, the settlement period has been fixed at 12 months, replacing the previously varied durations depending on the programme joined,” the ministry stated.

For existing users whose offset mechanism period has expired, PETRA said they will have the option to transition to other rooftop solar programmes, such as the Solar for Self-Consumption (SelCo) programme, the Community Renewable Energy Aggregation Mechanism (CREAM), or to install energy storage systems, or participate in any future government initiatives.

“With the NEM programme ending on 30 June, rooftop solar installations will continue under the SelCo programme, with enhancements including the removal of capacity limits and improved installation configurations, as previously announced,” the statement added. - July 1, 2025