KUALA LUMPUR: The Corporate Green Power Programme (CGPP) is expected to generate RM2.4 billion in engineering, procurement, construction and commissioning (EPCC) jobs for photovoltaic (PV) systems with an 800-megawatt (MW) capacity, according to MIDF Research.
The government aims to achieve net zero emissions by 2050, with renewable energy (RE) accounting for 70 per cent of the total generation capacity.
This entails adding at least 20 gigawatts (GW) of new RE by 2050, with over 90 per cent expected to be sourced from solar energy.
To promote solar power investment, the government has implemented various initiatives, such as the Feed-in Tariff programme, Net Energy Metering (NEM) mechanism, large-scale solar (LSS) projects and CGPP.
Subsequently, the Energy Commission plans to launch LSS5 with a capacity quota of 2GW, allowing developers to bid up to 500MW (previously limited to 50MW).
MIDF Research said in a note it was estimated that LSS5 would generate RM5 billion worth of PV system EPCC jobs, providing work for contractors until 2028.
In addition, the firm said there was a new 400MW quota under the NEM scheme from February to December to further encourage investment in solar energy assets.
"Businesses in general, driven by commercial reasons and environmental, social and governance considerations, have voluntarily invested in solar energy generation assets following the recent hikes in electricity tariffs," it said.
The research house has projected a lower average module price of energy this year. This follows a multi-year decline in solar panel prices.
Energy researcher BloombergNEF has projected a 29 per cent jump in global solar panel installation to 574GW this year from 445GW last year.
"However, we anticipate slower demand growth thereafter, at nine per cent and seven per cent next year and in 2026, respectively, primarily due to constraints such as accessibility to the grid, land and labour.
"China is expected to maintain its position as the largest solar panel consuming country in the world, commanding a 55 per cent share of the total 574GW of new solar panel installation this year, followed by the United States (seven per cent) and India (three per cent).
"While the demand for solar panels globally is rising on a rapid pace on the transition to green energy, it is outstripped by the supply growth of solar panels," said MIDF Research.
It said BloombergNEF described the current state of the solar panel industry as "a game of chicken" among players to see "who will succumb to the pressure and exit the market first".
"All in all, the prices of solar panels are at historically low levels, and the supply of components is abundant. Consequently, while solar panel makers struggle to make a profit, PV system EPCC contractors enjoy good margins and are poised for more jobs as cheap solar panel prices stimulate investment in PV systems.
MIDF Research said the capital expenditure for PV systems was likely to come in lower than the RM2 million to RM2.5 million per MW for the LSS4 rollout given the lower solar panel prices.