Malaysia Solar Capacity Surges as Battery Storage Costs Drop

As battery storage costs continue to decline, Malaysia’s solar capacity has seen significant growth, with solar-plus-storage projects becoming the new trend in the renewable energy sector.

Key Data

• Malaysia added 2.5 GW of new photovoltaic capacity in 2025, a year-on-year increase of 40%
• The proportion of supporting energy storage projects increased from 10% to 35%
• Battery energy storage system costs decreased by 25%, driving the development of integrated solar-storage solutions

Trend Analysis

1. C&I Market Boom: Commercial and industrial solar-plus-storage is becoming standard configuration
2. Grid-Scale Projects Launching: TNB initiates first batch of large-scale energy storage tenders
3. Residential Market Starting: Net metering policies drive household energy storage demand

Challenges and Opportunities

Challenges: Limited grid connection capacity, complex approval processes Opportunities: Increased policy support, declining financing costs MESA continues to work with industry stakeholders to address these challenges and maximize opportunities for energy storage deployment in Malaysia.