Malaysia’s energy regulator has issued updated guidelines for rooftop solar installations under the NEM Rakyat and NEM GoMEn schemes, providing clearer rules on system capacity, eligibility, grid connection and technical requirements.

The new framework could help bring greater clarity to Malaysia’s rooftop solar market as net metering continues to support distributed PV deployment across Peninsular Malaysia.

What Do the New NEM Rules Allow?

Under the updated guidelines, eligible applicants generally need to be customers of Tenaga Nasional Berhad (TNB) and install their solar PV systems on the rooftop of the same premises.

For NEM Rakyat, residential systems are capped at:

• 5 kWac for single-phase connections

• 12.5 kWac for three-phase connections

• 
  

For NEM GoMEn, systems can reach up to:

1,000 kW

subject to technical and network constraints.

This creates a significant difference in the potential scale of projects covered by the two schemes, ranging from small residential rooftop systems to much larger installations.

How Does the Net Metering Mechanism Work?

Solar electricity generated by the system is first consumed on-site.

Any excess generation can then be exported to the TNB grid, with the exported electricity credited against consumption on a 1:1 basis.

Unused credits can be carried forward for up to 12 months. The NEM arrangement remains valid for 10 years. After the NEM period ends, the system continues operating under a self-consumption model without NEM offsets. This structure gives consumers a clear incentive to maximise on-site solar consumption while using the grid as a mechanism for managing excess generation.

Larger Systems Face Additional Technical Requirements

The updated guidelines also introduce additional requirements as system size increases.

Projects above:

72 kW

All installations must comply with applicable electrical, safety, technical and TNB grid-connection requirements.For larger commercial and institutional systems, this means project development will involve more than simply selecting PV equipment.

Grid capacity, technical studies, interconnection requirements and system design will increasingly become important parts of project planning.

Malaysia Already Has a Significant NEM Pipeline

The updated guidelines come as Malaysia's rooftop solar market has already reached substantial scale.

According to the Malaysian government, approximately:

1.7 GW

of PV systems are currently operating under the two NEM programmes.

Another:

595 MW

This indicates that Malaysia's distributed solar market is moving beyond an early-adoption phase and toward a more established deployment model.

Why the New Guidelines Matter

Malaysia's net-metering framework has evolved considerably since it replaced the country's feed-in tariff incentive in 2016.

The government subsequently revised the mechanism to encourage greater adoption, followed by NEM 2.0 in 2019 and NEM 3.0 in 2020.

The latest guidelines provide greater clarity around how rooftop solar projects should be designed, connected and operated under the current NEM structure.

For developers and installers, the key opportunity may therefore be less about whether rooftop solar has a market in Malaysia, and more about how efficiently projects can navigate technical requirements and optimise system economics.