Malaysia’s solar energy market is entering a major investment cycle driven by utility-scale photovoltaic projects, battery energy storage systems (BESS), floating solar, data-center demand, grid modernization and cross-border renewable electricity trade.
The Malaysian solar market is projected to reach approximately MYR 5.04 billion in 2026, reflecting a 31.23 percent CAGR between 2023 and 2026E. The growth opportunity is expanding beyond conventional solar farms as Malaysia builds an increasingly integrated renewable-energy ecosystem connecting generation, storage, grids and corporate power demand.
Malaysia ended 2025 with approximately 5,777.73 MW of cumulative solar PV capacity, up from about 4,329 MW in 2024. Annual installations accelerated from approximately 710 MW in 2023 to 939 MW in 2024 and 1,448 MW in 2025.
Despite this expansion, an estimated 95 percent of Malaysia’s long-term solar potential remains untapped, providing substantial headroom for further investment.
LSS6 Adds 2.65 GW Solar and 1.25 GW Battery Storage
Malaysia’s sixth Large Scale Solar program, LSS6, is emerging as a key catalyst for the industry’s next growth phase, combining 2.65 GW of solar capacity with substantial battery storage requirements.
Package 1 comprises 2.2 GW of solar and 1.1 GW of BESS, while Package 2 covers 300 MW of solar and 150 MW of BESS. Package 3 adds another 150 MW of solar without a battery requirement.
Combined BESS power capacity under Packages 1 and 2 reaches 1.25 GW.
Projects under Packages 1 and 2 can range from 60 MW to 500 MW, while Package 3 targets smaller developments of 10 MW to 30 MW.
The program is expected to attract approximately RM13 billion-RM15 billion of private investment, with projects targeted for completion by the end of 2029.
The BESS figure of 1.25 GW represents battery power capacity, rather than energy capacity measured in MWh. Actual storage energy will depend on the duration specified for individual projects.
UOB Kay Hian estimates that LSS6 and the Corporate Renewable Energy Supply Scheme could generate around RM13 billion-RM23 billion of EPCC replenishment opportunities through 2029. Malaysia’s wider solar development pipeline for 2026-2029 exceeds 6.5 GW.
Kenanga Research, based on earlier assumptions, estimated approximately RM8 billion of LSS6 EPCC opportunities, with batteries potentially representing 40-50 percent of the additional component cost compared with solar-only developments.
Solarvest Revenue Jumps 41% as Project Portfolio Exceeds 3.7 GW
Solarvest is among the Malaysian solar companies positioned to benefit from the expanding project pipeline.
The company reported FY2026 revenue of approximately RM757.1 million, up 41.0 percent year over year, while net profit increased 53.7 percent to RM79.8 million. Gross profit reached approximately RM214.0 million, with gross margin improving to 28.3 percent.
Solarvest has accumulated more than 3.7 GW of ongoing and completed clean-energy projects across eight Asia-Pacific countries.
Its major Malaysian projects include the 470 MWac Larut and Matang LSS5+ solar development in Perak with Malakoff. Solarvest owns 20 percent, while Malakoff holds 80 percent.
Solarvest has secured approximately RM504.1 million of LSS5 EPCC contracts. Its corporate renewable-energy portfolio also includes approximately 345.9 MWp of Corporate Green Power Programme contracts worth RM685.4 million.
Analyst estimates suggest Solarvest could potentially capture 20-30 percent of LSS6, equivalent to approximately 500-750 MW of solar projects and 250-375 MW of BESS. These are estimates rather than confirmed project awards.
Samaiden Could Target 250-375 MW of LSS6 Solar
Samaiden is another potential beneficiary of Malaysia’s upcoming solar-plus-storage investments.
Analyst estimates indicate the renewable-energy developer could capture around 10-15 percent of LSS6, potentially representing approximately 250-375 MW of solar and 125-188 MW of BESS.
If these projections materialize, LSS6 could provide significant new business opportunities for Malaysia’s established renewable-energy EPC and project-development companies.
TNB Builds 5.2 GW Renewable Pipeline as Grid Investment Accelerates
Tenaga Nasional Berhad (TNB) has a strategically important role because Malaysia’s renewable transition requires simultaneous investment in generation, battery storage and electricity networks.
TNB has approximately 1,131 MW of operational renewable-energy capacity, another 102 MW under construction and approximately 5.2 GW under development, excluding BESS.
Its grid investments could be equally important to Malaysia’s energy transition. TNB has a regulatory-period capital expenditure allowance of approximately RM42.8 billion for 2025-2027.
The investment requirement reflects the need to modernize transmission and distribution infrastructure as Malaysia integrates greater volumes of intermittent renewable electricity and accommodates growing demand from sectors including data centers.
Kenyir 595 MW Floating Solar Project Gets RM1.962 Billion EPCC Contract
Floating solar is emerging as another major investment opportunity.
The 595 MWac Kenyir floating-solar project in Terengganu carries an RM1.962 billion EPCC contract and combines floating photovoltaic generation with battery storage.
The development involves Cypark Renewable Energy and Fabulous Sunview. Cypark holds 60 percent of the consortium and Sunview owns 40 percent.
Completion is targeted for 2028.
The longer-term opportunity is considerably larger. Kenyir reservoir has been identified as having approximately 2.2 GW of floating-solar potential, indicating substantial scope for additional development beyond the current 595 MWac project.
Floating PV could enable Malaysia to increase renewable generation while reducing competition for land. Combining floating solar with hydropower resources and batteries could also provide greater flexibility for the electricity system.
Malaysia Builds 2 GW and 8 GWh Battery Storage Pipeline
Battery storage is rapidly becoming a core element of Malaysia’s renewable-energy infrastructure.
TNB’s Santong BESS in Terengganu provides 100 MW / 400 MWh, while the Lahad Datu BESS in Sabah adds another 100 MW / 400 MWh. Combined, the two projects provide 200 MW of power capacity and 800 MWh of storage.
Malaysia’s MyBeST initiative is expected to add another 400 MW / 1,600 MWh through four grid-connected projects, each providing 100 MW / 400 MWh.
Together with LSS6’s 1.25 GW battery requirement and the existing and planned standalone projects, Malaysia is developing a much larger storage ecosystem to support its expanding renewable-energy fleet.
The commissioning of grid-forming capability at Santong also illustrates the changing role of batteries. BESS can support frequency control, voltage management, peak-demand management, renewable-energy shifting and overall grid resilience.
Data Centers Drive 1.5 GWp Solar and 2.2 GWh Storage Opportunity
Malaysia’s fast-growing data-center industry is creating another source of renewable-energy demand.
TNB Renewables and TNB Power Generation have entered arrangements supporting approximately 1.5 GWp of solar generation and 2.2 GWh of battery storage for DayOne Data Centres under Malaysia’s Corporate Renewable Energy Supply Scheme.
The scale highlights how data centers can become anchor customers for new solar-plus-storage projects.
Rising electricity requirements from digital infrastructure could stimulate additional investment in renewable generation, BESS, transmission infrastructure, corporate power procurement and energy-management technologies.
Singapore Power Imports Open 900 MW Cross-Border Opportunity
Malaysia’s renewable-energy investment story is also becoming regional.
Singapore has granted conditional approval for projects involving a combined 900 MW of electricity imports from Peninsular Malaysia, with associated renewable-energy developments involving solar generation and battery storage in Johor.
Cross-border electricity exports could provide an additional market for Malaysian renewable-energy developers alongside domestic utilities, industrial customers and rapidly expanding data centers.
Johor could particularly benefit because of its proximity to Singapore and its position as a major Malaysian data-center investment hub.
Kuala Muda Solar Project Secures RM1.05 Billion Green Sukuk
Green finance is scaling alongside Malaysia’s solar project pipeline.
The 500 MWac Kuala Muda solar project has been supported by an RM1.05 billion ASEAN Green Sustainable and Responsible Investment sukuk, demonstrating the role that Islamic finance and sustainable capital markets can play in financing large renewable infrastructure projects.
With LSS6 alone expected to mobilize RM13 billion-RM15 billion, Malaysia could see increasing demand for green sukuk, project financing, infrastructure funds, green bonds and institutional capital.
Malaysia Solar Outlook: 5.78 GW Installed, More Than 6.5 GW Pipeline
Malaysia’s solar market has moved from gradual PV adoption toward large-scale renewable infrastructure development.
Cumulative solar PV capacity reached 5,777.73 MW in 2025, following annual additions of 710 MW in 2023, 939 MW in 2024 and 1,448 MW in 2025. The market is projected to reach approximately MYR 5.04 billion in 2026, supported by a 31.23 percent CAGR during 2023-2026E.
LSS6 will introduce another 2.65 GW of solar and 1.25 GW of BESS power capacity, backed by an estimated RM13 billion-RM15 billion in private investment. The broader 2026-2029 solar pipeline exceeds 6.5 GW, while corporate demand is supporting projects such as the 1.5 GWp solar and 2.2 GWh DayOne storage arrangement.
Meanwhile, the 595 MWac Kenyir floating-solar project, 900 MW potential electricity exports to Singapore, TNB’s RM42.8 billion 2025-2027 capex allowance and the RM1.05 billion financing for the 500 MWac Kuala Muda project illustrate how investment is spreading beyond conventional solar farms.
SHAFANA FAZAL
