17 Jul 2020
Posted in Power
Malaysia bets on large scale solar PV to revive COVID-19 hit economy, says GlobalData
To kick start the economic recovery and the subsequent growth engine, the Ministry of Energy and Natural Resources (KeTSA) of Malaysia had launched a 1GW tender in 2016 under the Large Scale Solar (LSS) program. The program’s fourth round of auctions termed as LSS-4, offers the largest capacity in the series and is expected to boost COVID-19 economic recovery efforts of the government. The LSS-4 tender is expected to restart the investment flow and result in a possible generation of 12,000 job opportunities, says GlobalData, a leading data and analytics company.
Somik Das, Senior Power Analyst at GlobalData, comments: “Taking into consideration the effects of the COVID-19, Malaysia’s cumulative solar PV capacity is expected to grow by 8.0% to about 1.1GW in 2020. The step is considered as a growth shot of an ailing economy to fight the COVID contraction.”
In the first round of the LSS in 2016, the government allocated 250MW in the country. In the second tender in 2017, 360MW was allocated in the peninsula and 100MW across Sabah and the islands of Labuan. The third tender went undersubscribed by 10MW, where bids for 490MW were lodged. The government has high hopes from the fourth round especially considering the current scenario and its impacts on the economy.
Across major Asia-Pacific countries, the Levelized Cost of Electricity (LCOE) for renewables remains significantly higher compared to coal power plants. This is expected to decrease if not vanish in the next eight to nine years.
Das concludes: “In Malaysia, the decrease in the LCOE from US$88/MWh is expected to greatly benefit the local bidders. Besides, the LSS 4 provides the opportunity of creating almost 12,000 employment opportunities. This is expected to stimulate the economy and help the nation propel through the existent stagnancy.”