Net Energy Metering

Overview of NEM
The Ministry has introduced few solar PV initiatives to encourage Malaysia’s Renewable Energy (RE) uptake. Read more about it here at here.
NEM Concept

The concept of NEM is that the energy produced from the solar PV system installed will be consumed first, and any excess to be exported and sold to the distribution licensee (such as TNB /SESB ) at the prevailing Displaced Cost prescribed by the Energy Commission. Read more about it here.

Frequently asked questions (FAQ) regarding Net Energy Metering (NEM). Read more about it here.
NEM Guidelines
The government of Malaysia, through the EC, has issued guidelines in 2016 for the purpose of implementing the Net Energy Metering (NEM) scheme, in line with the EC’s function to promote RE. Read more about it here.

NEM - Frequently Asked Question

Source: SEDA Malaysia

Q: When will the new NEM commence (where there is no difference in sale and purchase price of electricity)?

A: The new NEM mechanism will commence on 1st Jan 2019 and applicable to all existing NEM consumers.


Q: What is new Net Energy Metering (NEM) (effective 1st Jan 2019)?

A: A mechanism where an eligible consumer installs a solar PV system primarily for his own use and the excess of energy (kWh) to be exported to the grid and to be offset against kWh from the energy provided by the Distribution Licensee (TNB) to the electricity consumer during the applicable billing period.


Q: What is one-on-one offset?

A: One-on-one offset means every 1kWh exported to the grid will be offset against 1 kWh consumed from the grid with gazetted tariff. The export charges are charged in decending order (start from the highest applicable rate).


Q: Who can apply for NEM?

A: Registered consumers of Tenaga Nasional Malaysia (TNB) in Peninsular Malaysia.

  • Not blacklisted (No outstanding bill & meter tampering)

Open to all categories of TNB consumers under the following tariff*:

  • Domestic/Residential (Kediaman)
  • Commercial (Komersial) [inclusive of government buildings]
  • Industrial (Perindustrian)
  • Agriculture (Pertanian) Effective from 1st January 2019


*Refer to TNB consumers electricity tariff

The resource for producing electricity shall be from Solar Photovoltaic (PV) only


Q: What types of installation are eligible under NEM?

A: Installation types:

  • on rooftop of buildings
  • on garage, car park or similar buildings

Note: For ground-mounted system, it may be allowed on case-by-case basis and the installation shall be within the compound of the applicant’s premises and approved by the Energy Commission.


Q: What is the maximum capacity that one can apply for?

  • For domestic or residential consumers, the allowable maximum capacity of the PV system installed is 12 kWp for single phase system or 72 kWp for 3 phase system.
  • For commercial, industrial and agricultural consumers, the allowable maximum capacity of the PV system installed is 75% of maximum demand or 60% of fuse rating or 60% of current transformer rating.


Q: How can I apply for the NEM?

A: Applications can be made via eNEM system. NEM applicant shall appoint SEDA’s Registered PV Service Provider (RPVSP) for NEM application submission. For a better understanding, please refer to NEM’s Process Flowchart at “Net Metering” >> “NEM Workflow” tab.

List of Registered PV Service Provider (RPVSP):


Q: Is there any cash transaction for the excess of energy exported to the utility each month?

A:  There is no cash transaction and any excess of energy exported to the utility is allowed to be rolled over for maximum of 24 months from the start of NEMCD (or December of the following year).


Q: What is Supply Agreement with Renewable Energy (SARE) and where can I get more information about it?

A:  The detailed guideline/ information will be ready on 22nd Nov 2018. There will be a tri-partied agreement between the three parties (Customers Solar Investor/Lessor and TNB). TNB will provide the service of billing, collection and remittance of the payment by customer to solar investor/lessor and in return, TNB imposes a small service charge. The business models supported by SARE includes solar leasing, PPA or a hybrid of both.


Q: What is the maximum duration allowed from application to proposed NEMCD?

A: 12 months from the date of NEM is approved until the date of proposed NEM contract with TNB, failing which the quota allocated will be refused and offered back to other potential NEM applicants.


Q: What types of meter are required for NEM?

A:  2 types of meter are required as below:

  1. TNB’s bi-directional meter (with import-export feature) to record the amount of electricity consumed, produced or exported;
  2. PV meter/data logger/inverter with monitoring feature to record the total amount of electricity generated by the PV system.

Optional - May install check meter for measurement of the energy export (if applicable) and shall be of the same or equivalent to the standards of the consumer meter installed at the premises by TNB;


Q: Am I eligible to participate in NEM?

A: Yes, as long as you are a customer of TNB. The basis is always your electricity bill. Please ensure you are a registered customer of TNB (your name/ company as appeared in the TNB bill), only then you are eligible to participate in NEM.


Q: If I plan or have installed Solar PV system for self-consumption (SELCO) and have taken the necessary steps to ensure no reverse flow or energy exported to the grid, do I need to apply for NEM?

A:  No, but for PV system with capacity above 72 kWp, generation license (private) from ST is required and subject to complying with the relevant rules under the Electricity Supply Act (ESA). For more information please refer to the Guidelines on the Connection of Solar Photovoltaic Installation for Self-Consumption issued by ST.


Q: Is a non-local / 100% foreign company eligible to participate in NEM?

A: Yes, as long as the company is a customer of TNB.

Q: What types of incentives are available for NEM consumers?

A:  At the moment there are fiscal incentives offered to eligible companies in the form of Green Technology Incentive by Malaysia Investment Development Authority (MIDA), available until 2020.


Is there any tenure of the new NEM contract between TNB and roof owner?

There is no tenure period between the new NEM and old NEM. The NEM contract shall remain in effect unless otherwise terminated by either party or cancellation of the main electricity contract.


Will the owner be able to cash out for excess of power generated each month or just get credit for next month use?

Any excess of solar power generated is allowed to roll over within 24 months from the start of NEM consumer’s billing system. No cash will be paid in the NEM scheme.


I saw the 'solar leasing' was introduced during IGEM 2018. May I know the capital for installation is provided by company (service provider) or government grant?

The capital for installation will be provided by Investor. Please check the term and condition directly with them.


How is the connection between the consumer’s solar PV system and the DL distribution system?

The connection to the TNB network shall be done only through indirect connection, i.e. within the owner’s internal distribution board only.

What is NEM Assessment Study (NEMAS)?

The study will determine the technical impact to the Distribution Licensee’s electricity distribution network and establish technical and safety requirements that may be necessary for the installation.

The requirement is based on kWp of installation as below:

Installed Capacity Study Required Fee of Study (RM)
1 – 72 kWp No -
72 kWp – 180 kWp Yes 1,000.00
> 180 kWp – 425 kWp Yes 5,000.00
> 425 kWp – 1 MWp Yes 8,000.00


Is ST License required under NEM?

Only applicable for solar PV system installation:

  • above 24kW for single phase; and
  • above 72kW for three phase

Any person who uses, works or operates the installation shall require a license as stipulated under the ST “Guidelines on Licensing Under Section 9 of the Act”.


What are the required information & documents for NEM application?


  • Applicant’s Profile
  • Project information
  • Technical information
  • Proposed work plan


  • Single Line Diagram (SLD) endorsed by Competent Person;
  • Latest electricity bill
  • Load Profile Report
  • NEMAS or PSS Report
  • Document proofing site ownership


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