Budget 2025 is a big step for Malaysia’s renewable energy goals, laying out key strategies to push the country toward a greener future. From major investments in solar energy to new tax incentives and the introduction of a carbon tax, the government is positioning Malaysia as a leader in the global shift to clean energy. Here’s a breakdown of what this means for renewable energy in Malaysia.
Net Energy Metering (NEM) program, which lets households and businesses install rooftop solar panels, now available until June 2025.
A new initiative, CRESS (Corporate Renewable Energy Supply Scheme), allows companies to buy renewable electricity directly, helping them lower their carbon footprint. The government is also pushing agrivoltaics, combining solar energy with agriculture to maximise land use without hurting food production.
The Green Technology Financing Scheme (GTFS) is extended with RM1 billion in funding until 2026 to help businesses go green. There’s also a RM70 million e-Rebate to promote energy-efficient appliances.
For government agencies, energy savings are encouraged through Energy Performance Contracts, aiming to cut electricity bills by up to 10%. Tax incentives are also extended for AI-powered recycling machines and EV chargers, helping Malaysia move towards a circular economy.
Perhaps the most impactful move is the Carbon Tax that will target high-emission industries like steel, iron, and energy by 2026. This tax aims to push companies toward low-carbon technologies, and the revenue will be invested in green tech research.
The government will also introduce a Carbon Capture, Utilisation, and Storage (CCUS) framework to help reduce industrial carbon emissions and meet climate goals. This plan comes with expanded tax incentives and blended financing for businesses that invest in clean technology under the New Investment Incentive Framework.
Budget 2025 sets Malaysia on a clear path to a renewable energy future. With substantial investments in solar, green hydrogen, and carbon reduction, the country is making significant strides. These initiatives offer both opportunities and incentives for businesses and households to play a role in this energy transition.
With incentives like the Net Energy Metering (NEM) program and Corporate Renewable Energy Supply Scheme (CRESS), solar energy has never been more accessible or cost-effective
Investing in solar now not only reduces electricity costs but also positions you to benefit from future green energy developments. As the world moves toward cleaner energy, those who adopt solar early will be part of a growing network of forward-thinking individuals and businesses driving Malaysia’s energy transition. Now is the time to embrace solar, not just for the planet, but for the long-term financial benefits it promises.
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