Malaysia’s renewable energy sector is set to receive renewed momentum with the government announcing a new 250MW feed-in-tariff (FiT) quota for non-solar renewable energy sources, including biogas, biomass, and small hydropower projects, for 2027. This allocation follows recent enhancements to the Corporate Renewable Energy Supply Scheme (Cress), aimed at encouraging greater participation from corporate energy consumers and developers.
The 2027 FiT quota is divided into 30MW for biogas, 120MW for biomass, and 100MW for small hydropower projects. Interested parties can participate in the electronic bidding process scheduled to open on February 3 and close on March 24, 2027. Commissioning of approved projects is expected to begin as early as 2030.
Although the total FiT quota for 2027 is lower than the 300MW offered in 2026, industry analysts view the move positively. TA Research highlighted that the 2026 e-bidding cycle had awarded 341MW across 40 projects, surpassing the initial quota. The early announcement of the 2027 allocation suggests a continuation of support for renewable energy initiatives. TA Research also noted that the current quota represents about RM3 billion in potential investment, which could benefit developers, engineering and construction firms, and supply chain participants involved in these renewable energy segments.
Several listed companies are positioned to benefit from this development. Malakoff Corp Bhd, Jentayu Sustainables Bhd, and Kinergy Advancement Bhd have experience or ongoing projects in small hydropower. Companies such as Cypark Resources Bhd, Samaiden Group Bhd, and Kinergy are identified as potential contenders or developers in the biomass and biogas fields.
An industry participant emphasized the growing electricity demand, particularly driven by the rapid expansion of data centres, which necessitates accelerating renewable capacity deployment beyond solar power. Non-solar renewable sources like biogas, biomass, and small hydropower provide generation flexibility at different times of the day, helping to stabilize the grid amid increasing reliance on intermittent renewable technologies.
The government’s Cress enhancements include a 30% reduction in the system access charges (SAC) to 14 sen per kilowatt-hour and a mandated minimum contract period of 10 years between renewable energy developers and corporate offtakers. TA Research noted that the SAC reduction improves Cress’s appeal, especially for heavy industries and data centres, which face higher fuel cost adjustments. The longer contract tenure is expected to enhance project cash flow visibility and overall bankability.
Market observers expect further growth in Cress participation, with key players such as Tenaga Nasional Bhd (TNB), Solarvest Holdings Bhd, and Samaiden Group Bhd positioned to benefit. Earlier in September, TNB signed an agreement to explore supplying up to 1.5GW of power to DayOne Data Centre, a deal projected to increase its earnings per share by approximately 8%. Solarvest is also partnering with Canadian investment firm Brookfield to develop up to 1.5GW of Cress projects.
RHB Research has projected potential Cress awards for Solarvest to range between 300MW and 500MW by the end of 2026, prompting a revised target price for its shares. Similarly, Samaiden’s target price was increased based on expected order replenishment from Cress projects, which currently make up 70% of a RM3.5 billion tender book.
The latest developments highlight ongoing government and industry efforts to diversify Malaysia’s renewable energy mix and support the country’s growing electricity demand through more varied non-solar renewable sources.