The Energy Commission has officially launched the sixth round of its Large Scale Solar (LSS6) programme, offering 2.5GW of new solar generation capacity alongside 1.25GW of battery energy storage systems (BESS), in a move expected to unlock between RM13 billion and RM15 billion in investments while advancing the country’s renewable energy transition.
According to RHB Research, the Ministry of Energy Transition and Water Transformation (PETRA) formally introduced the programme on July 16, with a further 150MW of solar capacity reserved specifically for Bumiputera companies in Peninsular Malaysia.
The programme is targeted for commercial operation by Dec 31, 2029.
LSS6 is divided into three packages. Package 1 comprises 2.2GW of solar generation paired with 1.1GW of BESS, while Package 2 offers 300MW of solar capacity and 150MW of battery storage exclusively for Bumiputera companies. Package 3 allocates a further 150MW of standalone solar capacity, also reserved for Bumiputera participants.
PETRA has scheduled the request-for-proposal (RFP) period for Packages 1 and 2 from July 27 to Aug 7, while submissions for Package 3 will take place between Aug 17 and Aug 28.
Based on previous procurement timelines, RHB Research expects successful bidders could be announced as early as August or September.
Individual bids will range from 60MW to 500MW under Packages 1 and 2, while bids for Package 3 are capped between 10MW and 30MW.
The research house estimates the overall programme could generate capital expenditure of between RM13 billion and RM15 billion, based on estimated development costs of RM3 million to RM3.5 million per megawatt for solar generation and approximately RM4 million per megawatt for battery storage.
While the final power purchase agreement (PPA) terms have yet to be announced, RHB believes project returns may trend towards the mid-single digits due to intensifying competition among developers.
Top key beneficiaries
RHB maintained an “Overweight” rating on Malaysia’s utilities and renewable energy sector, naming Solarvest Holdings Berhad and Samaiden Group Berhad among its preferred beneficiaries of the latest solar auction.
The research house expects Solarvest to secure between 20% and 30% of total project capacity, equivalent to approximately 500MW to 750MW of solar installations and 250MW to 375MW of battery storage.
Samaiden is projected to capture between 10% and 15% market share, translating into around 250MW to 375MW of solar capacity and 125MW to 188MW of battery projects.
Should these projections materialise, they would provide additional upside to RHB’s existing FY2027 order book assumptions of RM2.7 billion for Solarvest—of which RM1.2 billion has already been secured year-to-date—and RM600 million for Samaiden.
Falling panel costs
RHB also noted that solar photovoltaic (PV) module prices continue to decline, improving project economics despite expectations of lower investment returns.
Its channel checks indicate Chinese suppliers are currently quoting solar panels at approximately US$0.11 per watt, down from recent highs of US$0.13 per watt.
The decline has been supported by weaker raw material prices, including silver, which has fallen about 47% year-to-date to US$56.90 per ounce from its January peak of US$121.60.
Meanwhile, polysilicon prices in China have dropped more than 38% this year to approximately CNY32,667 per tonne.
Lower equipment costs are expected to partially offset tighter project margins as developers compete aggressively for LSS6 contracts.
Utilities remain preferred plays
Beyond renewable energy developers, RHB continues to favour Tenaga Nasional Berhad and YTL Power International Berhad as its top utility picks, citing their strategic positioning within Malaysia’s accelerating energy transition.
The brokerage believes the rollout of LSS6 reinforces the country’s commitment to expanding renewable energy capacity while supporting long-term demand for grid infrastructure, battery storage and clean energy investments.
