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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).
2. located far from any water bodies e.g. lake, river, sea – water bodies resulted in
denser air thus scatter more sunlight
3. located near to closest TNB main distribution system
4. 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
5. wind speed, but this is not critical factors as Malaysia has fairly low wind speed
throughout the year.
6. 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 3-
4 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)

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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

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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

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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 Origin Location FDI (RM b) Employee Start


First-Solar US Kulim, Kedah 2 1200 2008
Q-Cell Germany Selangor 5 3500 2009
Sunpower US Rembia, Melaka 5 5500 2010
Tokuyama Japan Bintulu, Sarawak 1.8 500 2011

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