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Press Release
Saturday, May 26, 2012

Seda doesn't expect big changes to FiT rates from RE quota review

THE Sustainable Energy Development Authority (Seda), which has started relooking at the quota for renewable energy (RE), is not expecting major changes to the feed-in-tariff (FiT) rates.

Chief executive officer Badriyah Abdul Malek says Seda Malaysia was in the process of studying and articulating RE quota which would be released late in the year.

"On the FiT rates, we have been given a directive by the Energy, Green Technology and Water Ministry to relook at the FiT rates especially for solar in view of the declining pricing trend of solar photovoltaic (PV) modules, and we are in the process of appointing a consultant to do that.

"Seda does not anticipate a lot of changes to FiT rates for other RE sources," she tells StarBizWeek.

The FiT was introduce to spearhead the development of energy generation from RE such as biogas, biomass, small hydro and solar. Unfortunately, there has been so much frenzy on solar that it could be sending the wrong message to the market which prompted Seda to relook at the quota and possibility tweaking it.

As at Feb 29, Seda has approved 377 applications for RE with installed capacity of 311.56MW. Of the amount, 140.03MW installed capacity was from solar PV. Solar PV has received tremendous applications but biogas and biomass have so far not been as popular.
According to Seda's renewable energy capacity map on Friday, a total of 13 small hydro projects (11 in Peninsular Malaysia and two in Sabah) under feed-in tariff have been approved. The authority has also given approval for nine biomass and six biogas (landfill/sewage) renewable energy projects. All the six biogas projects are located in Peninsular Malaysia.

The biogas project owners are Kub-Berjaya Energy Sdn Bhd with installed capacity of 3.2MW, Jana Landfill Sdn Bhd (1MW and 1.9572MW), Cypark Suria (Pajam) Sdn Bhd (1MW), Gaya Dunia Sdn Bhd (0.5MW) and Bumi Masyhur Industri Sdn Bhd (2MW).
Jana Landfill is a unit of Tenaga Nasional Bhd while Cypark Suria is a subsidiary of Cypark Resources Bhd. Cypark is reported to have invested RM94.29mil to build a renewable energy park comprising a 2MW biogas plant and a 8MW solar power facility with national grid connection on a remediated landfill.

Asked on the rationale of the adjustments, Badriyah says: "The need to adjust the degression rate for solar PV is due to the declining pricing trend of solar PV modules. The need to re-allocate unused RE quota from first half of 2012 to other half-yearly period is to reallocate unused RE fund to a valid period."

Degression rate where FiT rates decrease annually for each renewable energy resource, with the exception of small hydropower installations, is set to kick in next year.

Seda has been prepared to raise the degression rate if the study shows it was higher than the initial annual degression rate of 8%.

"We expect (to change the annual degression rate) but that would be determined on the study we are conducting currently," Badriyah says, adding that Seda will announced the new RE quotas soon when it obtained the approval of the authority.

Separately, Badriyah says Seda would include wind and geothermal as eligible RE to qualify for the FiT.

"Yes. Seda will include these resources to the FiT. We are now doing studies on the resource mapping for both wind and geothermal in Malaysia and the findings from the studies will also assist Seda in determining the FiT rates for these resources. With this new initiatives we anticipate there would better mix of RE resources which could be developed," she adds.

Source from: The Star Online
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