Malaysia Opens 250 MW Feed-in-Tariff Quota for Non-Solar Renewables

Malaysia has opened a new 250 MW feed-in-tariff (FiT) quota for 2027, covering biogas, biomass and small hydropower projects as the country continues to expand its renewable energy capacity.

The quota comprises 30 MW for biogas, 120 MW for biomass and 100 MW for small hydropower. E-bidding is scheduled to open on 3 February 2027 and close on 24 March, with successful projects expected to be commissioned from 2030.

The new allocation follows the government’s recent adjustments to the Corporate Renewable Energy Supply Scheme (CRESS), including a 30% reduction in system access charges (SAC) and a minimum 10-year contract period between renewable energy developers and corporate offtakers.

Although the 2027 FiT allocation is below the initial 300 MW quota offered in 2026, TA Research said the new allocation could act as a catalyst for Malaysia’s renewable energy sector. The research firm estimated that the 250 MW quota could represent approximately RM3 billion in potential investment across project development, EPC and related supply chains.

In the 2026 e-bidding cycle, 341 MW across 40 projects was ultimately awarded, exceeding the initial 300 MW quota.

The expansion of non-solar renewable technologies is also being driven by rising electricity demand, including demand from Malaysia’s rapidly growing data-centre sector. Industry participants cited the ability of biogas, biomass and small hydro to provide generation at different times of the day and complement more intermittent renewable sources such as solar.

Under CRESS, the reduction in SAC for firm renewable energy supply to 14 sen/kWh, together with the minimum 10-year contract tenure, is expected by research firms to improve project economics and financing visibility for developers and corporate offtakers.

The latest FiT allocation therefore adds another pathway for Malaysia to expand renewable generation beyond solar while the country prepares for continued growth in electricity demand.