Solar Village in Malaysia – A Route Map for Financing Mechanism

Abstract

Malaysia’s development has been largely financed from its fossil fuels resources that come principally from the South China Sea. This has enabled electricity to be distributed equitably throughout society and improved the quality of life for people in Malaysia. However, the depletion of fossil fuel resources and the international conflict over South China Sea territorial ownership may leads to inadequacy of supply in the future, and may give direct impact to people in the rural areas. Malaysia’s greatest potential for solar energy comes from photovoltaics (PVs) and the large roofs of village houses offer significant potential to contribute electricity both nationally and to the local communities. However, this technology is still unfamiliar to the people living in local villages due to the subsidised electricity by TNB and high capital costs of PV systems. This paper investigates whether establishing a “solar village” is feasible in Malaysia. Through a cost feasibility analysis, the potential of harnessing solar electricity for local villages in Malaysia has been demonstrated. A novel mechanism has been presented that allows rural households to own PV panels, rent the grid cables and to share surplus electricity within the community through a three (3) way financing routes map.