SOLAR

FAQ

NET ENERGY METERING

What is NEM?


NEM or Net Energy Metering is a mechanism for you to use solar energy that you produced for your own consumption. The excess energy generated will be exported to TNB grid and will be turned to credit that may be used to offset part of the electricity bill. Visit www.seda.gov.my for more information




Is NEM the same as FIT?


No it is not. FiT or Feed-in Tariff is a mechanism for granted selected customers to export all solar energy produced to TNB grid and the quota has long been fulfilled for solar. The main difference is NEM mechanism allows you to generate your own energy and use it to reduce electricity bill. You can sell the excess energy to TNB and we will offset it in the next electricity bill.




How do I apply NEM?


You can apply NEM quota directly from SEDA. If you join any of TNB solar solution, we will take care that for you





SOLAR PV SYSTEM

What happens to solar energy when I’m not at home?


There is a possibility that the solar production is more than your energy consumption. Excess energy generation will flow to TNB grid. If you are under Net Energy Metering Scheme, we will buy the excess energy and credit back to your electricity account.




How do I maintain solar PV system?


Malaysia is blessed with rain all year round. Rain will wash away the dirt on the solar pv system. Nonetheless, we recommend periodic inspection by solar service provider to ensure all in good condition. If you opt for TNB Solar Leasing or TNB Solar Energy Purchase, we will take care of the system for you throughout the contract period so you don't have to worry about it. For direct ownership, we offer periodic maintenance package so you can sleep peacefully at night.




How long does the solar PV system last?


Typical life span of solar pv panels is 25 years or more and 5 to 10 years for the inverter. Typically, the manufacturer will guarantee performance of the solar pv panels for 25 years. This guarantee however, does not cover poor performance due to damages such as vandalism, hail or theft. The guarantee also does not cover poor workmanship. Hence, it is important that you choose good and reliable solar installer. Do check out TNB solar solutions for your home, office or business.




Is the solar PV system safe?


We cannot emphasize more on the importance of choosing qualified solar pv installer. Quality material, good installation and maintenance ensure that your solar pv system is safe. In addition, please ensure only solar experts handle your solar pv system. Do not try to do-it-yourself.





SOLAR BENEFITS

Can I reduce electricity cost by going solar?


Yes. Typical saving is between 10-15% depending on your pv size, financing option, actual solar energy production and system performance. Check out our solar calculator to estimate how much saving you can get by going solar.




What are the factors that determine how much I can save by going solar?


Many factors determine solar energy production. For example, if there is shading on your roof due to tall building or trees, this will reduce the amount of your solar energy production. Cloud and rain will also reduce how much energy being produced.




Is there any government tax incentives for going solar?


If you are a business owner, you are eligible for Investment Tax Allowance (Check out MIDA website). However, this is only applicable if you finance your solar project either through cash, loan or lease and not through Solar Energy Purchase.





TNB SOLAR SOLUTION

How do I apply for TNB solar solution?


It is easy. Click on Get Free Consultation, drop your particulars and we will take care the rest for you.




Can I install at my parents’ home?


Sure. That will bring sunshine to their home




Can I install solar if I’m renting?


Not yet for now. We are working towards making that happen.




What is the process of getting solar energy?


Once we receive your registration, we will check site suitability. When we know all in good condition, we will install the solar.




My house is under construction. Should I apply now?


Yes, it will be good to include solar installation work in the construction plan.




What is the warranty period on the solar solution?


We provide 25 years of solar PV module of performance guarantee, 10 years of solar PV module and product warranty, 2 years of free maintenance package (for cash/credit card purchase), 1 year of workmanship warranty, and 24/7 free maintenance throughout contract period for solar leasing and solar energy purchase options.





SOLAR FINANCING

What is instalment plan or solar leasing?


This is zero cash upfront option. You will pay monthly fixed amount of the solar pv system cost to TNB after which you will own the system. The monthly instalment will be reflected in your monthly electricity bill. We offer up to 10 years installment. This is just like buying smart phones with your service provider under instalment scheme.




If I choose Instalment Plan (Solar Leasing), what happens when I sell my house or decide to move?


No problem. TNB solar solution is designed to be flexible and maximize your property's resale value. When you move or decide to sell your house, you have three choices:

• Transfer the agreement at no charge to the new homeowner. We will continue to provide our solar solution to the new owner.

• Purchase the system.

• Transfer the system to your new home at a cost




What is Solar Energy Purchase?


This is zero cash upfront payment. You will only pay for solar energy produced by the solar pv system at prevailing solar rate during the term of contract. Typical contract ranges from 20 to 25 years. Upon contract expiry, the solar pv system belongs to you.





SOLAR ENERGY PURCHASE (SEP)

What is SOLAR ENERGY PURCHASE (SEP) product?


A Solar Energy Purchase or ‘SEP’ is an arrangement to sell energy to a customer using solar panels owned by a third-party Investor/Asset Owner. TNB is a contracting and billing entity, and the customer’s premises act as the ‘host site’ that consume energy (also export to the grid if there is surplus). This arrangement is via a tripartite agreement called Supply Agreement with Renewable Energy (SARE) between Investor/Asset Owner, TNB (with TNBX as its billing agent) and the customer. The customer can either choose a Power Purchase Agreement (PPA) or Fixed Lease arrangement, which would be charged on their utility bill (TNB bill).




How is SEP structured?


SEPs are typically over a period of 15 to 25 years (depending on customer’s request) with a base starting price (solar cent/kWh price) to be agreed upon, usually below the customer’s current tariff with TNB. This solar cent/kWh price (usually) stays constant throughout the term of the SARE but could also be modelled via an escalation or annual increase, tiered or linked to the tariff. At the end of the SARE period, the customer will own the system, or before the end of the contract period, have the right to purchase the system at a predetermined price based on the then current fair market value. The arrangement could be of the nature where the asset is passed over to the customer at no cost under certain qualified conditions.




What is Supply Agreement with Renewable Energy (SARE) Agreement?


A Supply Agreement with Renewable Energy (SARE) is a tripartite agreement between by a third-party Investor/Asset Owner, TNB (TNBX as its billing agent) and the customer. The agreement details out the contract years, the solar cent/kWh price, the covenants and obligations of each party as listed above. TNB acts as only the contracting and billing agent in this contract. The SARE arrangement is supported by the Energy Commission (ST) of Malaysia and Sustainable Energy Development Authority (SEDA), and recently announced by the MESTECC Minister.




What are the benefits for a customer?


The customer essentially has little risk as they are merely buying energy from the Investor/Asset Owner at a rate less than what they would normally pay TNB. In addition, the customer is not responsible for maintenance (other than ensuring that there are no damages caused by them and no shading effect from nearby structures). Essentially the customer now has a second electricity supplier at a lower rate and with no exposure to possible future rate increases. Additional benefits to customers include the non-inclusion of taxes like KWTBB and ICPT charges, while contributing to sustainability objectives.




What are the disadvantages for a customer?


Since the Investor/Asset Owner of the PV system is bearing both credit and operating risks, they typically look for a certain minimum percentage rate of return (after tax) on their invested capital. This usually means that the customer will be paying for power for a longer duration (e.g. 15 and up to 25 years) before the solar PV system is handed over to them. Under customers own financing arrangement, usually the PV system’s payback period is 7 to 10 years so the customers get a much longer period of ‘free energy’ but they are now responsible for the upkeep and maintenance of the solar system.




Are there any tax benefits and other incentives?


Typically the asset owner of the solar system receives tax benefits and usually retains any rebates or performance based incentives including carbon credits. These forms part of the yield equation in determining the SEP sen/kWh price offer to the customer. The customer now is not required to pay added taxes like KWTBB and ICPT charges for the kWh consumed from the solar system. Investor/Asset Owner of SEP looks for an acceptable yield, and in addition to the carbon credit while managing system performance risks, they also bear the operating and maintenance expenses. Like all investments, yields are based on the total investment, the cash flows and any tax benefits and incentives received from the authorities.




When is the SEP economically feasible?


The yields for a particular project is usually based on:-

Total cost for the project

Annual energy production in kWh

Revenue from selling this energy via with or without NEMs

Annual increase (if any) in the cent per kWh

Length of the SARE contract in years

Purchase option(s) at the end of the SARE

Tax benefits as well as any other government incentives

Panel degradation, maintenance and component replacement cost




What other decision criteria is used by the investor/asset owner?


Credit risk of customers is of most importance, as you can only sell the energy from a system if the customer is still in business and will buy it from you. Most Investors/Asset Owners will be looking for very strong credits ratings as well as EPCs who they can rely upon to perform maintenance for the contracted period.




What is the size for SEP to be considered?


The optimum size of the solar panel will be determined after the investor/asset owner studies a customer’s consumption profile, the size of the rooftop available for installation of the panels and surplus energy that exports to the grid. Other information required are the irradiance potential and any shading effect of the location to estimate the production capacity of the solar panel thus determining the estimated savings on the customer’s electricity bill.




How do I as an investor/asset owner proceed for a SARE contract?


Investor/Asset Owner should do the initial feasibility study and propose to the customer. Once an LOI is received from the customer, the investor /owner needs to decide the billing mechanism to collect their monthly payments. SARE contract is an option available to the Investor/Asset Owner to use TNB billing system to do the monthly bill. TNBX is the designated contracting agent. SARE contract is to be obtained from TNBX. Only registered Investors/Asset Owners with SEDA are qualified for this SARE arrangement.




How do I, as an individual/company, apply for SARE?


Generally, SARE is applied by the Investor/Owner as they are the party that require TNB to assist in the billing & Invoicing, revenue management and contracting service. You can get more information on SARE via sending an email to tnbx@tnb.com.my or contacting your Investor/Asset Owner.




What is the maximum size in kW of Solar I can apply?


The limit is usually the rooftop size with a conservative estimate of 1kWp of solar panel per 10m square of rooftop area. A customer has two options:

Self-consumption – no export to the grid is required

Net Energy Metering where he wishes to export to the grid

Where surplus power is required to be exported to the grid, the customer needs to apply to SEDA for a NEM quota. The maximum kWp size of solar depends on 60% of the fuse rating for domestic customers and 75% of the historical 6-month recorded Maximum Demand for the commercial and industrial customers.




What happens to the surplus unit I generate?


The units generated can be exported to TNB grid. The customer must apply for a NEM (Net Energy Metering ) scheme that has a quota from SEDA (Sustainable Energy Development Authority) to be able to do so. Please refer to SEDA’s website for information on NEM (www.seda.gov.my)




What is the price of solar for 1 kW?


The price of solar per kWp depends on the market and it varies month to month. Currently, it ranges between RM4500/kWp to RM6000/kWp depending on the project size per site (usually inclusive of the inverter). This excludes the cost of maintenance of the panels and replacement of the inverter over the useful life of the solar panels.





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