Feed-in tariff in Malaysia: six months after

Malaysia passed the Renewable Energy Act, in which a feed-in tariff (FiT) scheme is included, in April 2011. The FiT scheme basically pays renewable energy producers a set rate (tariff) for each unit of electricity generated and fed into the grid, and generally obliges the power companies to purchase all the electricity from eligible producers in their service area over a long period of time, usually 15 to 20 years. The FiT scheme was launched in December 2011 and is administered and managed by the Sustainable Energy Development Authority (SEDA) of Malaysia. This paper analyses the impact of the FiT mechanism in Malaysia after six month of its implementation; particularly on the installation and economical aspects. Some of the interesting findings from the analysis include: (i) the uptake for renewable energy installations has been extremely high, particularly for solar photovoltaic installation, (ii) the foreign direct investment and domestic direct investment related to renewable sectors has increased dramatically, (iii) more ‘green’ jobs have been created, particularly in the manufacturing and installation sectors, and (iv) there are plans to include wind and thermal energy in the FiT scheme. It can be concluded that the FiT scheme in Malaysia has produced significant results during the first six months of its implementation. With a proper monitoring process from SEDA and an awareness scheme to the general public, renewable energy will most likely prosper in Malaysia.