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China Turns to Malaysian Solar Sector to Power BRI Programme

Joint venture solar facilities earmarked for powering East Coast Rail Link and Southeast Asia port expansions.

Photo: Solar energy: Environmentally friendly and BRI benefitting.
Solar energy: Environmentally friendly and BRI benefitting.
Photo: Solar energy: Environmentally friendly and BRI benefitting.
Solar energy: Environmentally friendly and BRI benefitting.

China has announced it is to back moves to build Malaysia's biggest solar-power plant. The project will see a 61MW solar facility established at a 110-hectare site in Kuantan, the capital of Pahang, Malaysia's third-largest province. From Malaysia's point of view, the installation marks one more step on its road to establishing a clean-energy network, while China sees the facility as vital for powering the further Southeast Asian expansion of the Belt and Road Initiative (BRI), the country's ambitious infrastructure development and trade facilitation programme.

Under the terms of an agreement reached at the end of last year, the Nanjing-based ET Solar and Northwest Electric Power Design Institute (NWEPDI), a division of the China Power Engineering Consulting Group, will work with UiTM Solar Power, a Selangor-headquartered solar photovoltaic developer, to build and operate the new facility. When completed, it will be the largest of the 42 new solar installations scheduled to be built at sites across Peninsular Malaysia, Sabah and Labuan in the run-up to 2020. Malaysia's Energy Commission hopes to bring 360MW of new solar power capacity on-stream over the next three years.

The Kuantan facility is expected to generate enough clean energy to power 80,000 households when connected to the national grid in November this year. ET Solar's second major Malaysian project, it comes in the wake of the company's work on a number of large-scale installations across the world, including sites in the UK, the US, Germany, Japan, South Africa, Chile and Turkey.

Its first project in the country was commissioned in April last year and saw the company establish a 12MW solar-power plant in the northern Kedah state. The facility came online at the end of last year and currently generates enough energy to power more than 5,000 households.

Apart from Chinese companies, South Korean businesses have also lent their expertise to help meet Malaysia's clean-energy aspirations. In December last year, the Seoul-headquartered Hanwha Energy Group announced it had been appointed to install and manage a 48MW solar-power facility in the northwestern Perlis state. With construction work scheduled to begin next year, it is expected to power 15,000 households when it comes online in October 2020.

Taken together, the Kuantan, Kedah and Perlis solar plants form part of an evolving clean-energy network designed to generate electricity for commercial and household use. A proportion of their output has also been earmarked for powering a number of BRI-related infrastructure projects, most notably the East Coast Rail Link, the expansion of Kuantan Port and the completion of work on the Pan-Borneo Highway.

The facilities are also key elements in the Malaysian Solar PV Roadmap 2030, which is likely to be unveiled later this year. The work of the Malaysian Investment Development Authority, the Roadmap is expected to act as the blueprint for delivering the country's integrated solar-energy ambitions.

Prior to the official unveiling of the Roadmap, a number of the expected proposals have already been enacted. In October last year, for instance, work began on stepping up the manufacture of solar photovoltaic cells, with the country aiming to be the world's second-largest manufacturer, after China, of such units – vital links in the solar-power generation chain.

Over the medium-term, more opportunities are expected to emerge for BRI investors as Malaysia continues to prioritise the expansion of its sustainable-energy sector in a bid to cut greenhouse emissions, reduce the nation's reliance on its oil and gas reserves and improve energy efficiency, while also bringing down the overall cost of power generation. The country is aiming to produce 2,080MW of energy from renewable sources by 2020, with solar power accounting for more than half of that total.

Geoff de Freitas, Special Correspondent, Kuala Lumpur

Content provided by Picture: HKTDC Research
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