Soft loan for domestic installation of solar photovoltaic in Malaysia: Is it the best option?

Muhammad-Sukki, Firdaus; Munir, Abu Bakar; Ramirez-Iniguez, Roberto; Abu-Bakar, Siti Hawa; Yasin, Siti Hajar Mohd; McMeekin, Scott G.; Stewart, Brian G.; Anuar, Khairil

Abstract

Malaysia has passed the Renewable Energy Act in April 2011, in which the Feed-In Tariff (FiT) mechanism is introduced. The FiT gives much emphasis on the solar photovoltaic (PV). This paper presents, first, an overview of solar PV in Malaysia until the present time. Next, a general concept of the FIT Malaysia is explained and finally the loan financing option for solar PV is presented. It also analyses the impact of the proposed interest rate to household consumers in Malaysia, in terms of the total profit, the net present value and the internal rate of return. It is found that the FiT scheme could potentially help in increasing renewable energy penetration, particularly for solar PV. To provide upfront capital for domestic solar PV installation, the soft loan facility from banking institutions is a feasible source if the interest rate is 5% or less.

• Presentation Conference Type: Conference Paper (Published)
• Conference Name: 2012 IEEE Business Engineering and Industrial Applications Colloquium (BEIAC)
• Start Date: Apr 7, 2012
• End Date: Apr 8, 2012
• Online Publication Date: Jun 28, 2012
• Publication Date: 2012
• Deposit Date: Jan 15, 2021
• Publisher: Institute of Electrical and Electronics Engineers
• Pages: 388-393
• Book Title: 2012 IEEE Business, Engineering & Industrial Applications Colloquium (BEIAC)
• ISBN: 978-1-4673-0425-2
• DOI: https://doi.org/10.1109/beiac.2012.6226089
• Keywords: solar photovoltaic, feed-in tariff, interest rate, total profit, net present value, internal rate of return
• Public URL: http://researchrepository.napier.ac.uk/Output/2715563