Net Energy Metering (NEM)

By Sustainable Energy Development Authority

(SEDA) Malaysia

The Ministry has introduced few solar PV initiatives to encourage Malaysia’s Renewable Energy (RE) uptake. From the RE townhall held on 12th July 2018, one of the key issues highlighted by the PV industry is the need to change the concept of NEM from the existing net billing to true net energy metering. This is will help improve the return of investment of solar PV under the NEM. Effective on 1st January 2019, the Net Energy Metering (NEM) will be improved by adopting the true net energy metering concept and this will allow excess solar PV generated energy to be exported back to the grid on a “one-on-one” offset basis. This means that every 1kWh exported to the grid will be offset against 1kWh consumed from the grid, instead of at the Displaced Cost previously.

 

The quota allocation for NEM is 500 MW up to year 2020. Quota allocation will be divided into domestic and non-domestic category. The NEM category has been divided into 4 categories which are Residential, Commercial, Industrial and Agriculture. The new NEM scheme is only applicable to Peninsular Malaysia and applicants must be a registered TNB customers. NEM is executed by the Ministry of Energy, Science, Technology, Environment and Climate Change (MESTECC), regulated by the Energy Commission (EC), with Sustainable Energy Development Authority (SEDA) Malaysia as the implementing agency.

NEM Concept
Image module

The concept of NEM is that the energy produced from the installed solar PV system will be consumed first, and any excess will be exported to TNB on a “one-on-one” offset basis. This scheme is applicable to all domestic, commercial, industrial and agricultural sectors as long as they are the customers of TNB. The PV systems can be installed at available rooftops or car porch within their own premises.

 

Based on FiT experience, solar PV is a technology that requires minimal construction and with high take up rate compared to other RE technologies. One factor driving such growth is the declining cost of solar PV systems in recent years. As solar PV technology is more applicable to the NEM scheme, it is one of the technologies that allows the public at large to play an active role in mitigating climate change. They can generate clean energy, hence reducing the energy consumption and greenhouse gas emissions.

 

The NEM scheme is ideally suitable to complement the current FiT and Large Scale Solar schemes in achieving the 20% national RE target in electricity power mix, reducing the dependency on imported fossil fuels.

The energy generated by NEM consumers will be consumed first which implies that less energy will be imported from the utility. In many countries, the NEM scheme is effective to hedge against fluctuation or increase in electricity tariff in the future. This is especially relevant for consumers that fall under the high electricity tariff block.

 

Under the NEM scheme, any excess energy generated will be exported to the utility grid and will be paid on a “one-on-one” offset basis. The priority is for self-consumption, however some premises especially industrial or manufacturing sectors which may not be operating during the weekends may have excess energy exported to the grid. The credit shall be allowed to roll over for a maximum of 24 months.

Maximum capacity

For domestic or residential consumers, the allowable maximum capacity of the PV system installed is 12 kWac for single phase system or 72 kWac for 3 phase system.

Any person who uses, works or operates the installation shall require a license as stipulated under the ST Guidelines On Licensing Under Section 9 Of The Act.  Licensing requirements are only applicable for solar PV system installation above 24kW for single phase and above 72kW for three phase.

Download Guideline

Via Power Purchase Agreement (PPA) or Solar Leasing

The enhanced NEM programme has spawn new solar business opportunities for investors in which customers can opt to purchase solar electricity via signing power purchase agreement (PPA) with solar investors, via solar leasing programme or hybrid of both as offered by solar investors

Power Purchase Agreement (PPA)

  • Upfront payment is negotiable and based on agreement between investors and consumers
  • Worry-Free Maintenance & Performance
  • Payment in Energy (RM/kWh) - You will pay for solar energy generated (RM/kWh) from the PV system
  • Longer payback period
  • Installation done by the Investor's EPC contractors
  • System is owned by the Investor

Solar Leasing

  • Worry-Free Maintenance & Performance
  • Longer payback period
  • Fixed Monthly payment (RM) - You pay a fixed monthly "rent" in return for the use of the PV system
  • Installation done by Investor's EPC contractors
  • System owned by after lease period end

Methods Of Payment

Direct Contract
Image module
  • 2 parties agreement : Consumer & Investor
  • Collection of payment between 2 parties
SARE
Image module
  • Tripartite agreement : Consumer, Investor & TNB
  • Collection of payment through electricity bill
  • TNB charges 2 sen/kWh for service fee
  • Non-Payment of outstanding amount - TNB may disconnect the power supply ( ESA Act Sec.29 )

Cash, Or Bank loan/Credit Card

Customers who wish to take part in the enhanced NEM scheme can do an outright purchase of the solar PV system via cash, personal loans or credit card.

Cash

  • One-off payment
  • Homeowner is the system owner

Loan/Credit Card

  • Payment based on system cost & interest rate
  • Period of Payment term can be vary
  • Fixed monthly payment
  • Upfront cost depends on system cost
  • Homeowner is system owner
  • Maintenance and the performance based on Manufacturer

Guidelines of Solar Photovoltaic Installation on Net Energy Metering (NEM) Scheme

SchedulesDescriptionDownload
NEM Guidelines & Schedule 1Guidelines of Solar Photovoltaic Installation on NEM Scheme & Schedule 1




Guidelines of Solar Photovoltaic Installation on NEM Scheme & Schedule 1 (Amendment 2019) - 14/1/2019
3.48 MB
127 Downloads


545.24 KB
136 Downloads
Schedule 2Form A – NEM Manual Application Form
1.06 MB
66 Downloads
Form B – NEM Contract for Domestic Consumer




Form B – NEM Contract for Domestic Consumer (Revision 1) - 14/1/2019
7.76 MB
44 Downloads


604.78 KB
77 Downloads
Form B – NEM Contract for Commercial & Industrial Consumer




Form B – NEM Contract for Commercial, Industrial & Agriculture Consumer (Revision 1) - 14/1/2019
5.80 MB
31 Downloads


588.50 KB
43 Downloads
Schedule 3RE (Technical and Operational Requirements) Rules 2011




RE (Technical and Operational Requirements) (Amendment) Rules 2014
1,012.43 KB
32 Downloads


639.24 KB
44 Downloads
Schedule 4Technical Guideline for Connection of Indirect Solar PV Power Generation for NEM




Technical Guideline for Connection of Indirect Solar PV Power Generation for NEM (Revision 1)



Technical Guideline for Connection of Indirect Solar PV Power Generation for NEM (Revision 2) - 14/1/2019

Please enter a valid license key for Download Manager

3.40 MB
22 Downloads


3.48 MB
18 Downloads


918.99 KB
46 Downloads

PROCEDURE FOR NET ENERGY METERING ASSESSMENT STUDY (NEMAS)

Before applying for the NEM application, the interested party is required to contact the Distribution Licensee (TNB) to conduct NEMAS for installation above 72 kW. The requirement for a mandatory study is generally based on the rated kW of the proposed installation as shown table below :

Installed CapacityStudy RequiredFee of Study
1-72 kWNo-
>72 kW - 180 kWYesRM1,000.00
>180 kW - 425 kWYesRM5,000.00
>425 kW - 1 MWYesRM8,000.00
>1 MW - 2 MWYesRM15,000.00
>2 MW - 5 MWYesRM20,000.00
>5 MW - 10 MWYesRM30,000.00
>10 MW - 30 MWYesRM40,000.00

The studies shall be conducted by the DL or its appointed consultant to establish the technical and safety requirements and determine the feasibility of the connection.

DescriptionVersionDownload
NEMAS Process FlowNEW as of 2 July 2018
39.96 KB
66 Downloads
NEM - Technical Study Application FormNEW as of 2 July 2018
126.23 KB
48 Downloads
NEM Customer Load Profile FormNEW as of 2 July 2018
65.46 KB
43 Downloads

PROCEDURE FOR NEM METER APPLICATION AND SIGNING NEM CONTRACT

  • Please click the Flowchart of NEM Application Process (updated as at 19 April 2019) for the details workflow:
  • NEM applicant must submit the application, only after all of the installation work for Solar PV fully completed. Submission must be done at TNB Subzone Office, with all of the documents as below :

Net Energy Metering (NEM) Meter Application with all of the forms and supporting documents as below :-

  • NEM Meter Application Form
  • NEM Certificate
  • Pictures of TNB meter and interconnection from the grid;
  • Picture of proposed meter location (If there are changes of meter location for the existing meter)

NEM Contract with all of the forms and supporting documents as below :-

  • NEM Declaration Form (TNB Contract)
  • Form G & Form H
  • NEM Contract (Domestic/Non Domestic)
  • TNB Inspection & Commissioning Form
DescriptionVersionDownload
NEM Meter Application FormUPDATED as at 19 April 2019
459.98 KB
59 Downloads
NEM Declaration Form (TNB Contract)UPDATED as at 19 April 2019
557.95 KB
50 Downloads
TNB Inspection & Commissioning FormNEW as at 2 July 2018
147.71 KB
48 Downloads

For any enquiries, please contact :

Mr. Hidayat Fahmi Bin Abdul Rahim

 

Telephone : 03 – 7967 9088 / 019 – 4782540
Email : hfahmi@tnb.com.my / re@tnb.com.my

 

Tenaga Nasional Berhad, Level 16, Wisma TNB
No 19, Jalan Timur, 46200, Petaling Jaya, Selangor Darul Ehsan.

RPVI is a Registered PV Investor for NEM programme which allows any company to become an investor under the solar PV projects. Under RPVI, the investor provides leasing/ power purchase agreement (PPA) services.

RPVI Directory
Local RPVI
  • No capacity limitation
  • Must be locally incorporated
  • Minimum paid-up capital of RM1 million
Foreign RPVI
  • Only applicable for capacity above 250kW
  • Must be locally incorporated
  • Minimum paid-up capital of RM10 million
  • Minimum 80% local employment is required
  • Required to have 100% local EPC contractors

RPVSP is a Registered  PV Service Providers (RPVSP) companies which include services such as consultancy, design, supply, installation and testing & commissioning of a complete solar PV system.

RPVSP Directory

The concept of NEM is that the energy produced from the installed solar PV system will be consumed first, and any excess will be exported to TNB on a “one-on-one” offset basis.

NEM Workflow
Image module

How much can you save by going solar? Let’s find out through our NEM investment calculator.

NEM Calculator