Since the beginning of this year, the current Imbalance Cost Pass-Through (ICPT) surcharge imposed on non-domestic users from the commercial and industrial (C&I) sectors has led to swelling operating costs as a result of higher electricity tariffs.

The higher tariffs have pushed users to adopt energy-efficiency measures, especially C&I consumers ranging from factories to shopping malls, which snapped up almost all available rooftop solar power generation quotas provided by the government under the Net Energy Metering (NEM) scheme.

According to official data, 521.03mw of the C&I segment’s 800mw quota under the NEM has been taken up. The segment’s quota stood at 600mw previously, but was bumped up by the government by another 200mw in March.

Leveraging the government’s renewable energy (RE) incentive schemes, the NEM and Self Consumption (SELCO) schemes, Tenaga Nasional Bhd’s (TNB) wholly-owned subsidiary GSPARX Sdn Bhd is well primed to drive Malaysia’s RE aspirations as well as resolve the plight faced by retailers through enabling the use of solar energy generation for their day-to-day operations with zero capital expenditure (capex).

In the five years since its inception in 2018, the rooftop solar photovoltaic (PV) solutions specialist has aided 1,926 customers from the residential and C&I sectors, delivering a total capacity of 271.9mw in solar energy.

Just last month, GSPARX caught the eye of Asia’s largest retailer, Japan’s AEON, and secured its largest installation agreement by inking a Supply Agreement with Renewable Energy (SARE) deal with the retail giant’s 51.68%-owned Malaysian subsidiary AEON Co (M) Bhd to install solar PV systems at up to 40 of the supermarket chain operators’ shopping malls nationwide — with an aggregate peak capacity of 78mw.

TNB president and CEO Datuk Indera Baharin Din says: “As a large company from the Land of the Rising Sun that always sets high standards, AEON’s readiness to accept TNB’s offer to install solar panels is a reflection of its confidence in the quality of service provided by TNB through GSPARX with a business model capable of increasing AEON’s added value.”

Pursuant to a SARE contract, eligible commercial, industrial and government agencies need not pay an upfront cost to install the system nor a maintenance fee. They pay only for the solar energy produced — at a tariff lower than the regulated electricity tariff, resulting in reduced electricity costs.

In AEON’s case, once the installation of the rooftop solar solutions is completed, the solar PV systems can generate 99mwh of solar energy annually, with an expected accumulated savings of more than RM50 million over a 25-year period. The solar installations are expected to be completed in two phases: Phase 1 by December 2023 and Phase 2 by end-2024.

GSPARX managing director Elmie Fairul Mashuri says: “Having the trust of a multinational company like AEON to collaborate with GSPARX in helping them achieve their ESG (environmental, social and governance) goals gives us a boost in confidence. Through our zero-capex solution offerings, we aim to ‘solarise’ their shopping malls in Malaysia within the agreed time frame.”

AEON Co (M) chief financial and sustainability officer Dr Grace Lee says the retail giant sees the initiative as a significant breakthrough, as the company believes it has a responsibility to introduce more nature-positive solutions in the way it manages its business and operations, and reduce environmental impacts by implementing climate change actions to deliver a greener future and create long-term value for its shareholders, customers and employees.

The solar energy generated on the rooftops of AEON’s 40 malls could mean a reduction of more than 70,000 tonnes of CO2 emissions per year, equivalent to planting 1.2 million seedlings over 10 years.

Lee says: “We are grateful to have this collaboration. The process — from initial discussions to approval — went smoothly, with GSPARX offering the best business model and value-added services. GSPARX is focused on the green retail generation business and aims to unlock value in the local RE market by investing in solar PV systems for retail customers.”

Besides the emissions reduction, cost-savings and reputational enhancement in terms of sustainability, Lee says the solar PV systems will also increase the value of the properties, as potential buyers and tenants may value the long-term electricity savings and environmental benefits.

Even after the large RE installation move with GSPARX, Lee says AEON already plans to install further solar panels as and when it has new malls built, as well as continue with other sustainability measures such as electric vehicle charging and integrated waste management systems.

C&I consumers are increasingly turning to RE solutions to manage their operational costs, and GSPARX is well aware of this trend.

As the fluctuating costs of fossil fuels affect the ICPT, which in turn influences electricity tariffs, the company says the uncertainty is pushing retail players to look to alternative measures — such as rooftop solar solutions — to manage their operational costs and realise ESG gains.

“Rooftop solar PVs are an on-site solution that addresses both factors effectively — they help customers meet their ESG commitments while reducing some of their electricity expenses via the NEM and SELCO,” Elmie says.

Equipped with in-depth knowledge and expertise as well as serving as a one-stop centre for solar solutions — offering consultation, installation, maintenance, monitoring and repair services — GSPARX is capable of supplying its innovative solar solutions, enabling retail customers to focus on their core business.

Apart from AEON, GSPARX has committed to installing its rooftop solar PV solutions at six Mydin hypermarkets with a total capacity of 8.1mwp. Another retail partner under its belt is S P Setia, having signed an agreement to deliver 10mwp at seven of its commercial assets, including Setia City Mall in Shah Alam.

Not resting on its laurels, GSPARX is continuing to scale up its capabilities by enhancing and expanding local expertise in solar installations by enrolling the relevant staff to become qualified Strategic Partner System Installers.

“In this manner, our installers become Sustainable Energy Development Authority and Energy Commission-registered installers to ensure the highest quality of workmanship for solar solutions,” Elmie says.

In the long run, solar solutions can contribute to a smarter and greener way of doing business, according to GSPARX, and adopting RE can help achieve the nation’s aspirations of becoming carbon-neutral.

“By becoming a strategic partner with GSPARX, our customers are deciding to drive the nation’s energy transition towards a more sustainable future,” Elmie says. With the national RE generation target raised to 70% by 2050, C&I players’ RE adoption will help the nation progress from its current level of 25%.

The fruits of GSPARX’s labour also help TNB achieve its 8,300mw RE capacity target by 2025. The subsidiary has pegged a target to operate 150mwp to its solar assets by year-end, which the company is confident of achieving, as it is backed by its attractive zero-capex business model for corporate customers.

“The recent collaboration with AEON through SARE contributes significantly to the overall total RE capacity of TNB. Once all solar installations — across the 40 shopping malls — are installed by end-2024, the RE generated capacity is expected to reach 3,907mw, nearly 50% of the 8,300mw target by 2025,” Elmie says.

For more information, please visit www.tnb.com.my/solar or www.gsparx.com