Solar energy is becoming an increasingly attractive option for businesses in Malaysia. Thanks to a suite of government incentives, commercial and industrial players can reduce their upfront investment, improve their financial returns, and move closer to meeting sustainability goals.
Whether you’re considering rooftop solar or a full-scale energy solution, these schemes could make all the difference.
Malaysia has introduced several policies and programmes designed to encourage solar uptake in the private sector. These are the main ones businesses should know:
Offers a tax allowance of up to 100% of qualifying capital expenditure for green technology assets, including solar PV systems
Can be offset against up to 70% of statutory income in a given year
Valid for applications submitted before 31 December 2025 (as of current guidelines)
Allows businesses to claim depreciation of solar system costs over three years
Deductions can be applied to taxable income, helping lower overall tax obligations
Cannot be claimed together with GITA for the same asset
Targeted at commercial and industrial users
Allows companies to install solar and export excess electricity back to the grid
Exported energy is credited on a 1-to-1 basis, helping offset future bills and improve savings
The programme has a limited quota, so early applications are recommended
Offers soft loans with partial government-backed interest subsidies for green projects
Helps companies, especially SMEs, gain easier access to financing for solar investments
These incentives are designed to make solar more financially viable. Here’s how they benefit businesses:
Lower upfront cost — Tax reliefs and financing schemes reduce the initial capital burden, making it easier to invest
Improved cash flow — NEM NOVA enables businesses to reduce monthly energy bills while benefiting from exported solar power
Faster ROI — When combined, these incentives help shorten the breakeven period to just three to five years, depending on system size and energy usage
In short, government support helps turn solar into a cost-effective, long-term investment.
While each incentive has its own criteria, most are open to registered Malaysian businesses installing approved solar systems.
Businesses must apply through the Malaysian Investment Development Authority (MIDA)
Systems must use certified green technology products (MyHIJAU or SEDA-recognised)
Once approved, businesses can claim allowances during annual income tax submission
Applications are made through the Sustainable Energy Development Authority (SEDA) Malaysia portal
The process includes technical evaluations, system design submissions, and securing interconnection approval from Tenaga Nasional Berhad (TNB)
Many solar providers in Malaysia offer end-to-end services that include managing the application process, which can reduce administrative workload for companies.
Malaysia’s clean energy policies are evolving quickly in line with the National Energy Transition Roadmap (NETR). Here are a few updates and upcoming trends to watch:
More targeted support for SMEs — Future policies may include higher rebates or simplified access to financing for small and medium businesses
Voluntary carbon markets — As carbon pricing becomes more relevant, solar investments could help businesses offset emissions and generate carbon credits
Mandatory ESG and RE requirements — Larger corporations and public-listed companies are likely to face new renewable energy quotas in the near future
Staying informed and applying early gives businesses an advantage, especially with schemes that operate on a quota basis.
The Malaysian government has created a favourable environment for solar adoption through tax reliefs, financing options, and energy offset schemes. These incentives are designed to reduce costs, improve returns, and support the country’s wider sustainability goals.
If your business is exploring solar, now is the time to act. The financial and environmental benefits are clear — and with the right support, the transition can be seamless.
You May Also Find This Helpful :
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Reduce Operating Costs & Boost Your Bottom Line: The Financial Case for Commercial Solar in Malaysia
From rooftop to ROI: a step-by-step guide to commercial solar installation in Malaysia
How Commercial Solar Drives Corporate Sustainability in Malaysia
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