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MPIA proposes role consolidation, tax exemptions to bolster growth in RE sector
 

Published on: 13 June 2018

Tan Xue Ying, theedgemarkets.com

KUALA LUMPUR (June 13): The renewable energy (RE) sector in Malaysia could benefit from greater transparency and a consolidation of authority, according to the Malaysian Photovoltaic Industry Association (MPIA), which has also called for tax exemptions to address the limitations of funds among smaller industry players.

Oversight on renewable energy — specifically for solar photovoltaics (PV) — ought to be returned to Sustainable Energy Development Authority (SEDA) to allow a holistic implementation of the energy transition roadmap, the association suggested.

“SEDA was initially established as an authority on RE whose mandate is to implement the Feed-in Tariff scheme. Somehow, over the years, it appears that the role on RE, specifically for solar photovoltaics, has been transferred to other energy agencies,” the association said in a statement today.

It highlighted the auctioning of large scale solar (LSS) and regulatory powers of net energy metering (NEM) that are now with the Energy Commission (EC), and the energy, green technology and water ministry announcing Tenaga Nasional Bhd (TNB) as the administrator of a 200MW solar PV programme for universities, as examples.

“TNB is already enjoying monopolistic control on the electricity business, without having developed local or in-house talent in PV, but yet competes with a recognised authority”, the statement added.

Growth of the RE should not be stunted by any monopolistic entity, as the market drivers for the development of RE are the liberalisation of the electricity supply and democratisation of the market, the association noted.

In this regard, the association highlighted the need for greater transparency and high standards of compliance in a deregulated market environment.

“The MPIA suggests that the appointment of board members and senior management and authorities related to RE are due to merit and merit alone, whilst at the highest level of government, there should be a council of professionals of RE who do not have political links,” it said.

The development of human capacity in RE and related areas should also be an area of focus of the government, so as to encourage local service providers to capture a bigger solar PV market beyond the country, the association added.

“It is important that local PV service providers be given an opportunity to participate in domestic PV projects, in order to acquire the necessary skills to compete globally.

“MPIA acknowledges that the financial capacity of local PV service providers might be limited, compared with international PV contractors, and this limitation can be circumvented by encouraging more rooftop projects (factory, commercial buildings & residentials),” the statement further read.

As such, it proposed for a sales tax exemption — especially on PV modules, inverters, energy storage systems, and PV monitoring systems — through to end-2020 for stabilisation of the Malaysian PV market.

The non-profit association — representing 100 members in the PV industry — said it anticipates an open dialogue with the incoming minister responsible for the sector for further discussion on the nation's solar PV agenda.

 

Link: The Edge Markets

 
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