Making solar townships viable in Malaysia

Posted: 5 August 2005

Solar cells are notoriously costly. But this will soon change with the launch of a project aimed at making them affordable for Malaysians, reports Tan Cheng Li.

Solar energy advocate Ahmad Hadri Haris is hopeful that Malaysian property developers will warm up to the idea of developing solar townships, much like Solarsiedlung in Germany and Nieuwland in the Netherlands.

Fire station in the Netherlands using transparent photovoltaic modules
Fire station in the Netherlands using transparent photovoltaic modules
In this fire station in the Netherlands, transparent photovoltaic modules not only form the shell of the building, but also enhances its architecture. Highly visible use of PV technology in such public facilities will boost public awareness and confidence in solar energy.
"PVs can be included in new housing developments as a new marketing ploy. Such projects can gain developers a niche market as well as add value to the property," says the technical adviser to the Malaysia Energy Centre.

He believes the cost of photovoltaic (PV) systems would not be felt since it would have been added to the total property price.

But while the private sector mulls over the idea of solar townships, the Energy, Water and Communications Ministry is moving ahead to incite interest in the renewable energy.

Next year, it will launch a programme, Suria 1000, which gives the public the rare opportunity of generating their own solar power. Based on similar projects in Europe and Japan, the project will offer building-integrated PV (BIPV) systems at discounted prices to make the technology accessible and affordable for the public.

People have to bid for the systems, however, because they are limited in numbers. Bidding will start at 25 per cent of the capital price, which is about RM25,000 for a 1 kilowatt (kW) system. A 2kW or 3kW system is typically needed for an average household. The starting bid will be raised annually, to encourage public participation early on in the project. For the first of the four-year project, BIPV systems with a total capacity of 1,000kW will be offered.

Suria 1000 is part of the ministry's five-year RM100mil Malaysia Building Integrated Photovoltaic (MBIPV) project to develop the local solar energy market, launched yesterday. The Malaysia Energy Centre is implementing the project on behalf of the ministry.

"The key objective is to reduce the long-term cost of BIPV technology. This cost reduction will lead to sustainable and widespread use of BIPV, which will ultimately avoid greenhouse gas emissions," says Ahmad Hadri.

The project will promote BIPV technology - which covers PV that can be incorporated into building structures such as the roofs, façades, walls, windows and shades - instead of the traditional mounted solar PV.

Partially funded by the United Nations Development Programme/ Global Environment Facility, the MBIPV will include training workshops to build up awareness of solar energy, promote a local PV industry and build up expertise in BIPV technology. Laws and policies that encourage BIPV development will also be addressed.

Several facilities - one is the new Malaysia Energy Centre building - will incorporate BIPV technology to serve as showcase sites.

By 2010, a minimum of 1.5 megawatt (MW) of solar energy would have been added to the grid. Presently, PV installations in rural areas have a capacity of 2.5MW, while urban installations have 500kW connected to the grid.

Solar Information Centre in Freiburg, Germany
Solar Information Centre in Freiburg, Germany
Building design can be enhanced by incorporating photovoltaic modules into the building shell and facade, such as seen here in the Solar Information Centre in Freiburg, Germany.

Households participating in Suria 1000 will use the solar energy directly, and any excess will be fed into the electricity grid and sold to Tenaga Nasional Berhad - a system known as "net metering." This differs from Germany's "feed-in" approach, where all the solar power is fed to the grid.

Ahmad Hadri says the feed-in system could not be implemented here because of low tariffs. In Germany, energy producers are paid tariffs that are higher than the normal electricity price.

However, he believes the feed-in system should eventually be introduced here as it has boosted the PV sector in many countries. These countries also have various fiscal incentives to boost the solar market, some of which can be adapted to suit local conditions.

In Spain, building developers who include PV in their buildings can offset up to 95 per cent of the construction tax while for consumers, 10 per cent of the investment cost of PV systems is tax deductible.

When Japan started its 70,000 Roofs programme in 1994, it subsidised 50 per cent of the cost of PV systems.

The subsidies stopped in 1997 with the introduction of feed-in tariffs but low interest rate on loans for PV products have made private investment affordable. Source: Internetwork for Sustainablity. This article was first published in the Malaysian Star (July 26, 2005).