SARE is a tripartite agreement between the investor Tenaga Nasional Berhad (TNBX as a billing entity) and the buyer primarily for invoicing and invoicing and revenue management (“Service”). The agreement generally sets out the duration of the contract, the tariff for the purchase of solar energy by the investor (“Tariff AA”) as well as the agreements and obligations of each party. The SARE mechanism had received support from the Malaysian Energy Commission and Seda. Malaysia`s Renewable Energy Supply Agreement (SARE) is a programme covering related agreements and guidelines regarding the supply and consumption of renewable energy in Malaysia. The Renewable Energy Supply Contract (SARE) is a tripartite contract between an investor (GSPARX), a billing agent (TNB) and a customer. This is a program that is offered to legitimate commercial and industrial customers with the aim of offering a rate lower than the network rate. After installing the solar modules, customers must pay GSPARX only for the solar energy produced at a lower rate. In addition, all monitoring and maintenance is carried out by GSPARX for the duration of the contract. This approach is consistent with the introduction of solar power generation in Malaysia towards grid parity, where the cost per kilowatt-hour (KWh) calculated according to the principle of leveled energy costs (LCOE) is the same as the cost per KWh of electricity produced from conventional fuels, namely coal and gas. According to Minister of Energy, Science, Technology, Environment and Climate Change (MESTECC) YB Yeo Bee Yin, SARE allows consumers to enjoy the solar energy produced by the solar installation installed on its site without having to pay for the system. The NEM system will move from the net billing concept to the net energy measurement system, which only applies to the Malaysian peninsula for registered TNB customers. The government intends to provide sustainable, reliable and affordable solar energy to Malaysians through new guidelines from 1 January 2019, such as the New Net Energy Metering Scheme (NEM) Scheme (NEM) and the Renewable Energy Supply Agreement (SARE), said Minister of Energy, Science, Technology, Environment and Climate Change Yeo Bee Yin.
It will take 4 to 6 months from the signing of the SARE agreement for the system to be operational depending on the size of the project. During this period, the project would involve in-house process and detail engineering, application and approval from authorities, acquisition of photovoltaic modules and inverters, mobilization and installation. After the photovoltaic installation, GSPARX is coordinated with the TNB network for the installation of meters. Once the installations are completed, the TNB count begins from the commissioning of the photovoltaic installation in accordance with the billing cycle until the end of the contract. This Directive does not allow users to obtain advance charges for the installation of photovoltaic (PV) modules and the payment of the monthly rental fee or solar energy consumption may be paid to the participating solar company through TNB invoices. SARE makes green energy accessible to businesses by enabling investors to finance and own renewable energy production locally. With the growing popularity of the Solar Power Purchase Agreement (“AAE”) program in Malaysia as an alternative approach for business owners to engage in the green energy journey, PV system investors (“investors”) are beginning to realize that one of the biggest pitfalls of the AAE system is the risk of failure that can occur if the solar energy owner (“buyer”) refuses: make the payment to the investor or intentionally delay the payment to the investor….