Solar Farm in Malaysia

SOLAR FARM IN MALAYSIA A)

Compare and match 1. EU's biggest solar farm located in Spain with 120 000 solar PV panel covers 247 acres or land, peak capacity of 20MW and it can power up to 20 000 homes 2. At Peterborough, Canada, 140 acres of farm land converted into CAD45m solar farm capable to produce 10MW energy, for 1500 homes 3. Former EU's largest solar PV farm, located at Portugal, has 2520 super-sized solar panel covering 1250 acres of land. It produces 45MW electricity, enough for 30 000 homes. It costs GBP250m 4. Current title of world's biggest solar PV farm is CAD400m-recently-opened Ontario solar power plant, covering 950 acres of land. It has 1.3m solar panels, generates 80MW - sufficient for 12 000 homes

Consider the following points: Each solar panel in solar farm (3) is six times larger than conventional, 5kWp solar panel usually set-up at the roof-top of houses and one utilized in project (2) and (4) Solar farm (3) located in the region with highest number of hours of sunlight per year in Europe all using the same technology: monocrystalline silicon, ground-mounted solar PV with solar tracker cost of building (4) is roughly similar with cost of project (3) “number of homes” should never be used as an indicator of profitability etc. Electricity from solar farm (4) distributed among urban Ontarian, (1) and (3) for suburban and rural users and (2) for farmer’s users, which may include their warehouses and small-scale factories This demonstrates choosing correct technology, implementation and solar coverage (other factors will be discussed later) are critical factors when choosing suitable places to build solar farm. Research showed feasibility, profitability and manageability of solar energy is location-specific (not like fossil fuel – thousand barrels of oil will generate electricity almost identical at Brussels or Tokyo). Solar energy specialist shall be consulted. B)

Important criteria when choosing areas to build solar farm in Malaysia 1. plain terrains, valley or hilly areas (but not too high in altitude, usually 60m and below) plain terrain at and surrounding areas – simpler implementation for any solar technologies and as well as lower maintenance. Some solar power techniques, such as concentrated solar power (solar thermal, solar tower etc.) only suitable to be implemented at plain terrains valley areas is OK as long as elevated terrains (hills etc) surrounding it does not interfere with sunlight or forming shades that will decrease solar irradiance and electricity generation

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solar farms in hilly areas might be challenging and costly. Only South-facing part of the hill is suitable to plant solar panels. Hills might also be “terrace-terrained” (like paddy field at Bali). located far from any water bodies e.g. lake, river, sea – water bodies resulted in denser air thus scatter more sunlight located near to closest TNB main distribution system far from any "dusty" or smokes/smog released by industries – wind direction might also play some part as we also don’t want smokes from industries originated from distance places to disrupt solar panels at chosen location wind speed, but this is not critical factors as Malaysia has fairly low wind speed throughout the year. no fogs, especially during morning. This is very important especially if the solar farm located in the valley of build in hilly areas. High humidity (a.k.a fog) will badly reduce efficiency of solar panels even after fogs disappear.

Since Malaysia is a tropical country, number of hours of sunlight is predictable, uniform almost every day (min 10 hours), anywhere. This is the most critical part. The following is sunlight intensity - some journals indicated Kedah, Perlis and Northern Sabah as the region with highest sunlight intensity, which means at 13:00 in the afternoon, solar panel located in this region could generate more electricity than any other location in Malaysia. As at Peninsular, sunlight intensity showed decreasing trend from North to South: e.g. more electricity generated from solar panel at Penang compared to the same solar panel system, with same weather/cloud coverage etc located at Johor Bahru. However it is important to emphasize that difference of sunlight intensity is small or negligible across Malaysia Research by Pusat Tenaga Malaysia (PTM) concluded that the annual energy output for selected Malaysian cities varies about 1170-1600kWh/m² for roof-top system (related studies among cities in Germany showed most of the cities generates less than 1000kWh/m² annually) and 630-830kWh/m² for facade system, which is also among the highest in the world. As per day basis, at the very least, we can expect 6 hours of direct sunlight with irradiation of between 800W/m² to 1000W/m² - already very good for the usage of PV. Generally, solar irradiance is high between 08:00-08:45, low between 09:00-11:00, then starting to increase significantly between 11:00-14:30 (maximum at 12:30), before slowly decreasing after 15:00. Malaysia located at Northern Hemisphere, so solar panels should be directed to South for greater solar irradiance. Degree of angles for the solar panels to be positioned (azimuth and altitude/horizon), however depends on actual site. Energy payback time (a.k.a ROI) ranges between 1.6 to 2.2 years for roof-top system and 34 years for facade system. Industry-wide standard warranty of solar panels is lifetime (some only 30 years). Whichever it is, investment in solar energy is profitable in the long run. C)

Research by Universiti Kebangsaan Malaysia

Practical field study of various solar panel cells by researchers from UKM was published in Renewable Energy in 2009. This study endorses the use of copper-indium-diselenide (CIS) 2

solar PV panel as the first choice, followed by amorphous silicone for tropical climate, instead of following market trend of promoting mono- and multicrystalline silicone solar PV panels: 1. thin-film CIS has better performance ratio compared to other solar panel modules. However, the differences is very small 2. study showed ambient temperature is 31°C and average temperature of solar cells modules is about 42°C which is quite high and definitely will change the characteristics of output power 3. mono- and multicrystalline modules perform better when they are under hot sun, but as temperature rises, their efficiency drop. CIS and amorphous silicone perform well in cloudy and diffused sunshine and their efficiency does not significantly affected by the changes in temperature (a.k.a better power conversion efficiency) Copper-indium-diselenide (CIS) solar panels: 1. deemed as a successor to silicone technology. Silicone is still expensive to make but the technology can be considered mature and reliable, so there are still many investors keen to invest in silicone solar panels industry rather than the alternatives of silicone such as CIS and amorphous silicone solar cells. 2. CIS is far cheaper to make and install (one-fifth to one-tenth of comparable silicone technology) 3. other than incorporated onto the typical solar “panel”, CIS could also be embedded onto plastics and glass, making it more flexible, more attractive thus driving the cost further down 4. CIS was more durable and not degrade over time like other thin-film technology 5. mass production of CIS is still limited, largely due to lack of interest among investors and problems in obtaining raw materials. This trend will change in the next two years as high-profile investment from Google and Ebay founder, Shell and some silicone solar panel manufacturers made four year ago start kicking in the market and the cost of raw materials become cheaper since the same minerals were also used in production of flat-screen television and high resolution touchscreens for mobile phones. D)

Feed-in Tariff (FiT) in Malaysia

Other than tax cuts and subsidies, solar industry (manufacturing of solar panels, generation of electricity and distribution) in North America and Europe has grown very fast due to: 1. respective governments mandates independent power producers (IPP) to “going solar” and wean themselves off of fossil fuel energy sources. 2. this IPP usually will invest in buying shares of solar panel manufacturers or forming a joint-venture whereby they will set-up large solar farm to generate electricity. IPP in US was responsible in quadruple increase of solar power generation between 1989 and 2003. 3. solar panels in US are cheap because most of them are imported, primarily from China. US government now provide generous subsidies to revitalize homegrown 3

solar equipment manufacturers. Economies-of-scale made solar panels cheaper in Europe. 4. respective government also mandates power distributor/utility companies to buy solar-generated electricity (from IPP) at the slightly higher price than an average kWph rate they sell to the IPP (net metering rate). Power distributors, in return will be given tax credits equivalent to accumulative price difference. As for small-scale, individual house, power distributor must accept the request from PV customers to be connected to the grid and pay the same amount of power they receive from solar system as for the power they dispense to their customers. 5. In several US states and countries in Europe, utility companies offer time-of-use rate scheduling, where electricity rates are highest during peak usage time (generally from noon until 18:00). The timing is perfect for solar PV systems because they generate a majority of their power during peak time (as explained before, by law the utilities must pay the same rate they charge for power, so at peak time they must pay peak rates). Then later, when use more power than generating (e.g. at night), power was charged back at a much smaller price. In this way, the size of a solar PV system can be leveraged to increase return on investment. None of these five points currently applicable in Malaysia. Tax cuts and subsidies are important, but most people/investors do not want, or cannot, lay out a big investment solely for the purpose of rationalizing their energy consumption. More sustainable policy is crucial. During the National Photovoltaic Conference in November 2009, PTM presented a full FiT scheme which will be introduced to the Malaysian parliament in November 2010 for the 10th Malaysia Plan period. It is proposed that: 1. payback duration (contractual agreement for electricity supply) for solar PV is 21 years 2. tariff kWh is RM1.25-RM1.75 3. annual degression is 6% - to encourage rapid deployment, promote competition and achieving grid parity 4. displaced electricity cost is RM0.35/kWh To make FiT possible, the renewable energy (RE) law under the RE policy must make sure that: 1. RE electricity generated must have access to the utility distribution grid 2. FiT must be high enough to produce a return on RE investment 3. FiT must be fixed for a long enough period to give certainty and provide businesses with the security for RE market development 4. there must be a degression for the FiT to promote RE cost reduction in achieving grid parity 5. adequate fund is created to pay for the incremental tariff cost and guarantee the payment for the whole contract period 6. competent agency to implement FiT must ensure constant monitoring, reporting and transparency 4

By 2011, Malaysia is expected to emerge among the top five solar PV manufacturer worldwide, behind China and Germany with local PV industry contributing up to 4% to the national GDP by 2020 through revenues exceeding RM500b (USD154.5b). FDI on solar technology in Malaysia Company First-Solar Q-Cell Sunpower Tokuyama

Origin US Germany US Japan

Location Kulim, Kedah Selangor Rembia, Melaka Bintulu, Sarawak

FDI (RM b) 2 5 5 1.8

Employee 1200 3500 5500 500

Start 2008 2009 2010 2011

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