The utilities sector in Malaysia is witnessing significant advancements in battery energy storage systems (BESS), evolving from concept to reality with notable projects underway. The first large-scale BESS project is currently being constructed in Sabah, a pivotal development for the country's energy landscape. This project, developed by MSR Green Energy, will boast a capacity of 100MW/400MWh, positioning it as one of the largest BESS installations in the ASEAN region. Scheduled for completion by mid-2025, the project utilises equipment sourced from the global leader, Sungrow.
Maybank Investment Bank Bhd has maintained a NEUTRAL call regarding the sector, highlighting the potential of solar energy in conjunction with BESS. Companies associated with this emerging market include Tenaga Nasional Berhad (TNB, HOLD, CP: RM14.46, TP: RM14.00), which previously announced a potential development of a 400MWh BESS project in early 2024. However, no updates have been provided, suggesting that the project may still be in the feasibility assessment phase. Additionally, Seal Inc is directly involved in the Sabah project, while the Genetec-Citaglobal joint venture manufactures BESS units locally under the "MYBESS" brand.
As the BESS market continues to evolve, solar players are expected to benefit significantly from the integration of BESS requirements in future solar projects. The regulatory framework surrounding BESS remains an important factor for market growth. Although BESS are typically regarded as generation assets that can be deployed at solar farms or as standalone facilities connected to the grid, there is currently no publicly disclosed revenue model for these systems. The regulator has indicated a supportive approach, evidenced by the design of the electricity third-party access scheme (CRESS) rates, which includes a MYR0.20/kWh fee difference between firm and intermittent system access charges. This fee difference may serve as a reference for BESS monetisation.
In recent months, notable progress has been made in the deployment of BESS, with projects like the one in Sabah setting the stage for further investments and innovations in Malaysia's renewable energy sector. The commitment to enhancing the country's renewable energy infrastructure signals a promising transition toward a more sustainable energy landscape.
