January-February , 2021 | @ green cover story
11
Review of NEM2.0 & NEM3.0
Feature NEM2.0 NEM3.0 Implication
Quota Allocation |
50MW for residential |
100MW for residential |
The demand for rooftop solar PV based on NEM2.0 |
|
450MW for others ( Commercial , |
100MW for Gov ’ t |
showed that the highest order came from C & I |
|
industrial & agriculture ) |
300MW for commercial |
(~ 90 per cent ). The 300MW allocation for C & I sector |
|
|
& industrial ( C & I ) |
under NEM3.0 is now reducing the distribution to only 60 per cent . |
Residential : Single-phase |
12kWac |
4kWac |
Under NEM3.0 , quota can be spread across more |
3 phase |
72kWac |
10kWac |
residential applicants due to the reduced cap and increased allocation . Still , each applicant cannot maximise rooftop space to take advantage of economies of scale and increase electricity savings . |
C & I |
No cap but have to comply |
1MWac ( Nett Offset ) |
The new cap for C & I under NEM3.0 poses a double |
|
with technical limits of NEM |
5MWac ( Nett Offset with |
constraint for premises which meet the technical |
|
guidelines |
virtual aggregation ) |
guidelines ( at least of existing NEM2.0 ) and can go beyond the 1MWac or 5MWac . Again , this limitation will not allow the business owner to maximise rooftop space to take advantage of economies of scale , reduce their carbon footprint & increase electricity savings . In a world where the nett-zero commitment is demanded by most developed economies , these companies ' need ( with exposure to these markets ) will require them to reduce as much carbon footprint especially if it also makes economic sense . On the positive side is introducing an innovative concept of virtual aggregation ( or virtual NEM ) which allows solar energy generated offsite to be shared by 3 accounts under the same business operator . This effort is lauded as the electricity demand for each building differs and buildings with large roof and low demand can optimise their roof space with solar PV installations through energy sharing . |
Compensation |
Compensation based on 1-on-1 |
Compensation based on |
The SMP is not a concept well known to all . Some |
Rate for surplus |
|
Systems Marginal Price |
awareness is needed among the business |
electricity for C & I |
|
( SMP ) |
community , and the concern here is that , at this |
& Rollover |
|
|
juncture , the SMP is much lower than the displaced cost paid under the original NEM or NEM1.0 . Therefore , it remains to be seen how this change in compensation rate affects the decision to invest in solar PV under the NEM3.0 . As an alternative , the government can consider opening the grid for third party access and allow excess solar electricity to be traded instead . This will provide opportunities for consumers to buy solar electricity from prosumers ( those with solar PV rooftops ) at a competitive rate with the regulated tariffs . |
Rollover of 24 months |
Rollover of 1 month |
Under normal situation , business operations seldom stop over a prolonged period . Hence , a rollover of one month may deem to be reasonable . However , taking the cue from 2020 , the Covid-19 pandemic has forced business closures for several months . It is times like this when extending the rollover beyond one month will help preserve investors ' cashflow from eroding , especially when normal business operations are not allowed . |
After 10 years , NEM3.0 will fall under SELCO for all categories .
In summary , MPIA lauds the government direction and strongly urges that the NEM 3.0 application process and implementation process remain precise and straightforward .
About MPIA
Who We Are The Malaysian Photovoltaic Industry Association ( MPIA ) is a non-profit organisation representing the Malaysian solar industry . MPIA is dedicated to the promotion of solar energy and consists of members from the local solar supply chain , including manufacturers , service providers , system integrators , consultants , insurance providers , training providers and academicians . MPIA bridges communication among the stakeholders and has been working with the government to ensure the efficient , ethical and professional growth of the solar industry .
Under SELCO , excess solar electricity will not be allowed for export . This differs with NEM , which helps excess solar electricity to be export ( within technical compliances ). Because of this fundamental difference , the solar PV system for SELCO is designed differently from NEM . For SELCO , the solar PV system is designed , so there is least opportunity for solar electricity to be exported , whereas this constraint is not in NEM . Businesses with seven days operations will benefit from SELCO as the chances of export are least compared to companies with only five days of operation . Hence , a switch of NEM to SELCO after 10 years may require energy storage to be in place to store the excess electricity which otherwise will not benefit the owners . Again , as with the suggestion above , after 10 years , the grid should be opened for third party access and hence , allow excess solar electricity to be traded . Enabling solar electricity trading at the distribution level can help optimise the local grid usage , so losses at the transmission grid are reduced and allow both prosumers and consumers to trade solar electricity at prices agreeable to both parties .
Our Vision
Everyone can generate their own electricity via solar PV .
Our Mission
• To reform and democratise the electricity supply industry ( generation , transmission and distribution ).
• To make solar PV price competitive , reliable , sustainable and one of mainstream sources of electricity supply in the country via innovations and incentives .
• To achieve the highest level of professionalism , knowledge and competency in the solar PV industry .
Objectives
To achieve a national target of at least 12 per cent of total national electricity consumption (~ 10,000 MWp or 10 GWp ) is supplied by solar PV by 2030 . — @ green
NEM3.0 to boost PV solar system usages
To boost solar energy usage and reduce energy cost , the Energy and Natural Resources Ministry ( KeTSA ) announced on Dec 29 , 2020 , the NEM 3.0 , which will be in effect from 2021 to 2023 .
NEM 3.0 will offer 500MW quota within the next three years for residential , commercial and industrial energy users .
KeTSA Minister Datuk Dr Shamsul Anuar Nasarah said the new scheme has three initiatives : People NEM Programme , New GoMEn Programme and Programme NOVA .
People NEM Programme
Under the People NEM Programme , the scheme will offer a “ oneon-one ” offset mechanism which allows every kilowatt ( kWh ) exported to the grid to offset against each kWh consumed from the grid .
It means every kWh generated will return and translate to higher potential earnings to the users .
“ Residential users who installed photovoltaic ( PV ) systems will enjoy an offset rate of “ one-to-one ” for 10 years , and they will practice the concept of self-consumption after the 10-year period ends .”
Self-consumption applies when electricity is generated for its own usage , and any excess is not allowed to be exported to the grid . About 10,000 to 25,000 TNB domestic account holders or between 40,000 to 100,000 households in Peninsular Malaysia will enjoy electricity bill reduction under this programme .
“ Quota applications for this programme can be made to the Sustainable Energy Development Authority ( Seda ) beginning Feb 1 , 2021 , until Dec 31 , 2023 .”
New GoMEn Programme
For the New GoMEn programme ( Government Ministries and Entities ), the ministry said PV systems , installed at government buildings , will implement the concept of “ one-to-one ” offset rate for 10 years and they too will practice the self-consumption concept after the 10-year period ends .
About 100 government agencies in Peninsular Malaysia will enjoy reducing electricity bills amounting to RM6mil a month , said Shamsul .
“ Quota applications for this programme can be made to the Seda beginning Feb 1 , 2021 , until Dec 31 , 2023 .”
Programme NOVA
Meanwhile , to assist commercial and industrial electricity users affected by the Covid-19 pandemic , Shamsul said Programme NOVA ( Net Offset Virtual Aggregation ) will assist entrepreneurs and local companies in reducing electricity bills and the cost of doing business .
According to Shamsul , users under this category will be able to sell extra electrical energy generated by the PV solar system at a market price or a system marginal price ( SMP ) as an energy credit in the following month ’ s electricity bill .
Under this category , users will also be able to offset extra electrical energy through “ virtual aggregation ” for up to three electricity bills under the same owner .
“ Quota applications for Programme NOVA can be made to Seda beginning Feb 1 , 2021 , until Dec 31 , 2023 , or until all quotas were distributed .
“ Details of this programme will be announced before applications are opened .”
“ The government hopes that the implementation of NEM3.0 will enable more Malaysians , government agencies , companies and local entrepreneurs to be involved in the agenda of the country ’ s latest energy development aside from reducing electricity bills to reduce the impact of Covid-19 ,” Shamsul added .
Nett Energy Metering 3.0 Implementation Mechanism
NEM 3.0 Programmes People NEM New GoMEn NOVA
Domestic |
Government Buildings |
Commercial & |
|
|
Industrial |
Offered Quota ( MW ) 100 100 300 Mechanism ( roll-over ) NEM 1:1 ( 12 months SELCO + ( 1 month ) Offer Date Feb 1 , 2021 Apr 1 , 2021 Offer Duration
3 years Offset rate Current Tariffs System Marginal Price Offset period
10 years After 10 years Self-Consumption ( SelCo )
Installation Capacity Limit
Single Phase : 4kWac Three Phase : 10kWac
1MWac / 1 Account
Nett offset : 1MWac
Nett offset + Virtual aggregation : 5MWac
Qualifications |
Domestic Account |
Government |
Non-domestic |
|
Holders |
Departments / Agencies |
Account Holders |