[Column] Malaysia CRESS SAC to 14 Sen – Conditions to be checked and contract risks in corporate green electricity procurement

✅ In a nutshell

• ⚡ The Malaysian government has announced an acceleration package setting the System Access Charge (SAC) applicable to CRESS's "farm supply" at 14 cents per kWh.
• 📅 Projects receiving the benefits must commence commercial operation by December 31, 2028, and the government has stated that it will not consider applications for deadline extensions.
• 🔋 Rather than uniformly stating that the 14 cents apply to "solar power + storage batteries," it should first be judged based on whether the farm supply requirements are met. Specific technical requirements will continue to be refined.
• 📝 Companies need to check not only the fees but also commercial operation delays, loss of SAC preferential treatment, battery performance, multiple contracts, and the transfer of renewable energy attributes.

Introduction

This time, the Malaysian government Announced on September 18, 2026 We will explain how to strengthen the Corporate Renewable Energy Supply Scheme (CRESS) and what companies should check in practice.

CRESS is a scheme that allows renewable energy generators and corporate demanders to directly trade green electricity using existing power grids.
For companies operating manufacturing facilities and data centers in Malaysia, this is seen as one option for realizing decarbonization targets and renewable energy procurement.

The focus this time was on the reduction of the System Access Charge (SAC).
However, it is premature to understand that "credit fees have decreased, so companies' electricity costs will continue to decrease."
It is necessary to confirm the supply model in question, the cost of storage batteries, etc., contractual price transfers, the deadline at the end of 2028, and any further detailed requirements that will be published in the future.

When considering Malaysia's electricity procurement system, I believe it is important to consider not only the name of the system and the published unit price, but also "who pays whom what, and which contracts break down the assumptions of electricity, environmental value, and price."
This article will also separate the contents of the government announcement from the matters that have not yet been decided, and then organize the next actions that companies should take.

What was decided this time

Reduce farm supply SAC to 14 cm

Malaysia's Ministry of Energy Transition and Water Transformation (PETRA) has introduced the CRESS Acceleration Package and applied SAC to farm supply 14 sen per kWh They announced that this would be the case.

SAC is a fee paid by renewable energy generators (RED) to deliver electricity to Green Consumers (GCs) using the electricity grid and related services in Peninsular Malaysia.
Current CRESS Guidelines from the Energy Commission The law stipulates that Single Buyer will claim and recover SAC based on the amount of electricity exported from RED to the grid.

According to a government announcement in August 2025, CRESS SAC will be farm-supplied 20 sen/kWh, non-farm supply 40 sen/kWh It was said that.
Compared to this 20 sen, this 14 sen is 6 sen, which is 30% lower in percentage terms.
However, this difference and rate are not stated in any government announcement and are calculated from the unit prices at both times as published.

However, 14 sen is the SAC level imposed on RED.
The price reductions that GC ultimately enjoys will vary depending on factors such as the price structure of the Bilateral Energy Supply Contract (BESC), the method of passing on SAC, and additional costs such as battery storage.
It is not possible to definitively conclude that the purchase price of a corporate consumer will automatically decrease by 6 sen/kWh.

The contract period is 10 years

PETRA is considering the contract between RED and GC as a way to strengthen CRESS as a whole Policy to set a minimum contract period of 10 years This was shown.
The same announcement states that a 10-year contract period will also apply between RED and GC for the acceleration package.

However, the FAQ still available on the Energy Commission website is: There is no minimum period for BESC That's the answer.
This may be because the response, which assumes the system content prior to the PETRA announcement on September 18, has not been updated.
Therefore, while the minimum 10-year policy should be considered an up-to-date government announcement, its legal and practical scope of application should be confirmed in the revised guidelines or implementation materials of the acceleration package.

The same FAQ also states that a minimum 21-year period is required for power generation licenses.
Given the difference between the duration of the power generation license and the contract period with GC, it is likely that securing sales and procurement options after the contract period expires will be a matter that both parties should consider from an early stage.

This prolonged period is expected to stabilize the outlook for revenue and purchase demand, making it easier to incorporate project finance.
On the other hand, there is a risk that contractual relationships will continue even if factories relocate or shrink, electricity demand fluctuates, companies restructure, or creditworthiness changes.

Therefore, it is necessary to consider not only the contract period, but also minimum purchase volume, treatment when demand does not meet, interim termination, contract transfer, change of control, and credit enhancement as a single integrated measure.

Commercial operation will need to begin by the end of 2028

Projects wishing to apply 14sen are: Commercial Operation Date (Commercial Operation Start Date, COD) must be reached by December 31, 2028 is required.

If COD cannot be achieved by the deadline, the acceleration package will be disqualified and the package will switch to the SAC and conditions applicable at that time.
PETRA is Applications for COD extension will not be considered It is clearly stated that:

RED/GCs that have already registered with Single Buyer, as well as new RED/GCs that will join in the future, may be eligible if they are ready to meet the specified conditions.

Therefore, the end of 2028 is not merely a goal to achieve.
When delays occur in areas such as land, permits, system analysis, connection work, financing, EPC contracts, equipment procurement, or commissioning, the key contractual issue becomes who bears the SAC difference.

What is "Farm Supply"

14sen's target is not simply described as "solar ＋ BESS"

PETRA's announcement covers farm supply.
Current CRESS Guidelines defines Firm Output as "dispatchable energy output," i.e., power output that can be commanded by the system operator.

A typical method for farming variable power sources like solar power generation is the Battery Energy Storage System (BESS).
However, it is not accurate to refer to all institutional targets as "solar ＋BESS."
This is because renewable energy technologies that can be adjusted to the power supply itself, such as biomass and biogas, are also possible.

On the other hand, if a solar project aims to supply farms, the BESS requirement is extremely important.
The current guidelines state that if a power generation facility cannot meet the farm output requirements, a storage system directly connected to RED should be installed, and its output capacity should be the lower of the registered capacity or the test capacity before commercial operation 50% or more, and for 4 consecutive hours This stipulates that the system will be subject to the directives of the Grid System Operator (System Operator, GSO).
If the energy storage equipment is unavailable due to a planned or unplanned shutdown, Non-farm SAC applies It is also stipulated.

However, PETRA states that the Energy Commission will continue to refine the technical requirements for solar power, BESS, firing capacity, and grid connectivity.
Therefore, it is not reasonable to assume that 14 sen will be determined if the BESS configuration of the existing guidelines is met.

Check technical and fee requirements simultaneously

When a company receives a proposal from RED, it needs to check the following:

• The legal and technical basis for treating the proposed supply as farm supply.
• BESS output, storage time, installation location, and command authority of the owner and GSO.
• The SAC applicable during the BESS suspension and the person who pays the difference.
• Which meter to check the amount of electricity generated, stored, and allocated to GC.
• Power reduction, system emergency, and alternative supply and fee settlement in the event of equipment failure.

Simply using a proposal labeled "BESS attached" is unlikely to determine the eligibility of 14sen and its long-term price effects.

Understanding CRESS's contract structure

Bilateral PPA alone is not enough

CRESS is not a system that will be completed once RED and GC sign a BESC agreement.
Current CRESS Guidelines At least Five contracts I've sorted it out when it comes to this.

1. RED and GC's Bilateral Energy Supply Contract.
2. RED and Grid Owner's Renewable Energy Supply Access Agreement.
3. NEDA Agreement between RED and Single Buyer.
4. Corporate Renewable Energy Supply Agreement between GC and Electricity Utility Company (EUC).
5. RED and EUC's Backfeed Agreement.

Single Buyer will verify that BESC complies with the CRESS Guidelines before the parties enter into any agreements.
Furthermore, as the final guaranteed supplier to GC, EUC will be responsible for supplying electricity when RED cannot generate or supply power.

In this structure, not only the completion of power generation equipment, but also the signing of each contract, NEDA registration, grid connection, testing and commissioning influence the process leading up to COD.

Check the renewable energy attributes in the contract

Current CRESS Guidelines In principle, green attributes belong to RED and are transferred to GC according to BESC.
GC's write-off of Renewable Energy Certificates (Renewable Energy Certificates, RECs) is to be carried out within Malaysia in accordance with international standards.

Therefore, contracts to purchase renewable energy alone do not necessarily guarantee the environmental value necessary for a company to reduce Scope 2 emissions and comply with RE100 standards.
BESCs are required to review the issuance, transfer, expense, amortization, prevention of double counting, and relief in the event of non-issuance of RECs.

Points to note when checking the possibility of participation

We will not adopt the "1MW/132kV or more" model for demanders

Some private commentaries describe CRESS demanders as "generally 1MW or more" or "132kV or more."
However, based on current primary sources, it was not possible to confirm these figures as general participation requirements.

Current Energy Commission Guidelines is seeking GC to be a Medium Voltage or High Voltage requester registered with the EUC in Peninsular Malaysia.
On the other hand, 30MW or more This standard is a requirement that applies to Green Energy Plants (Green Power Generation Equipment, GEP).

The guidelines state that RED will conduct business in the Malay Peninsula, and at least 51% local capital We also require that it have the following:
Furthermore, the maximum line delivery capacity of GEP is determined by the results of the Power System Study (lineage analysis, PSS).

These are collations based on current guidelines as of September 29, 2026.
Participation and technical requirements may be updated as the acceleration package becomes more detailed.

Things that haven't been decided yet

How long 14sen is fixed

PETRA announced a 10-year contract with 14-sen SAC, explaining that it will increase the predictability of long-term costs.
However, the announcement alone does not clarify whether 14sen will remain fixed throughout the entire duration of BESC, when it will be applied, or how it will be handled in the event of contract renewal, equipment shutdown, or change in output classification.

The current guidelines are for regular SACs, aligned with the regulatory period of the Incentive Based Regulation (IBR) The rate will be fixed for three years and revised at a maximum of 15% from the previous rate only at the start of the new regulatory period We have established the system.
In contrast, the reduction from 20 cents to 14 cents is 30 percent and is announced as an acceleration package separate from the regular fare revisions.

Therefore, the relationship between 14sen and the regular SAC review rules should be confirmed in future Energy Commission detailed documentation.

Details of the application procedure

The Energy Commission's CRESS page contains links to SACs, SACs for acceleration packages, regular CRESS applications, PSSs and technical documentation.
On the other hand, as of September 29, 2026, CRESS Acceleration Package Application Process The document is labeled "To Be Updated Soon."

PETRA itself claims that the package details will be provided by the Energy Commission.
Therefore, at this stage, it is safer to refer to the normal CRESS application flow and not make assumptions about the application timing, required documents, eligibility checks, and the start date of application of 14sen specific to the acceleration package.

Actions companies should take now

Organize your own demand and potential locations

First, for each site in Peninsular Malaysia, we will organize existing equipment such as receiving voltage, annual electricity consumption, maximum demand electricity, operating period, current TNB contract, and rooftop solar.
We will also check whether this applies to medium-pressure and high-pressure customers.

Compare RED proposals under the same conditions

In addition to the offered cost, we compare power generation technology, installed capacity, farm/non-farm classification, BESS specifications, assumed COD, grid connection points, PSS progress, and the status of permits, land, and financing.

According to PETRA, CRESS will be implemented in 2024 and beyond 11 REDs and 8 GCs registered with Single Buyer, with a total registered project capacity of 3,148 MW Yes.
However, this 3,148 MW is the capacity of the registered project and does not mean the capacity already in commercial operation.

Create a process table calculated backwards from the end of 2028

Work backwards from the COD deadline to see the critical paths for PSS, land, licenses, licenses, grid connections, BESC and other contracts, financing, EPC, BESS procurement and commissioning.

The Energy Commission, for the standard CRESS, covers the entire process from registration application to completion of necessary contracts, even before the development period for power plants and connection equipment begins Approximately 10～12 months This provides an estimate that this is necessary.
Individual projects also require periods for the construction of power plants and connection equipment, equipment procurement, and commissioning.
Therefore, working backwards from the COD at the end of 2028, we need to check the maturity of candidate cases early on.

Created by Single Buyer and published by Energy Commission CRESS application flow The process includes registration, Power System Study, connection verification, NEDA CRESS Deed of Access, Renewable Energy Supply Access Agreement and other agreements, application for power generation license, equipment development and commissioning, and obtaining a Commissioning Test Certificate.
According to the document, the application for the power generation license is three months before the planned COD date, so this point must also be factored in when working backwards.
However, since the flow dedicated to the acceleration package is awaiting updates, you will need to check the differences from the normal flow with Energy Commission or Single Buyer.

BESC faces the risk of missed deadlines and fee changes

BESC should consider at least the following:

• COD definition, prerequisites, deadline, and progress report.
• Identifying the causes of delays on the RED, GC, and system sides.
• The burden of the SAC difference in the event of the loss of eligibility for 14 sen.
• Fee changes when BESS is stopped or farm requirements are not met.
• Long-term suspension, power suppression, force majeure, and changes to laws and regulations.
• Minimum purchase amount, unmet amount, surplus electricity, and alternative supply.
• Issuance, transfer, and amortization of REC and other green attributes.
• Termination, contract assignment, change of control and credit enhancement.

Simply stating "SAC will bear the actual costs" in the contract may make it unclear who will bear which system changes.
It is considered important to separate the standard fee, preferential fee, loss of eligibility, and future revisions.

Compare with other renewable energy procurement methods

CRESS is unique in that it can physically source green electricity from specific REDs through the grid.
However, the comparison with rooftop solar, Green Electricity Tariff, REC procurement, etc. will vary depending on whether the company's objective is to reduce Scope 2, reduce costs, stabilize prices, or ensure additionality.

Rather than deciding on a single system and then considering contract terms, it is important to define the company's objectives, procurement volume, location conditions, contract period, and environmental value requirements first.

Summary

The CRESS Acceleration Package announced by the Malaysian government will set the SAC of farm supply at 14 sen per kWh and require COD by the end of 2028.
Reducing the cost from 20 cents to 14 cents could improve the economics of the CRESS project.

On the other hand, the final procurement costs for corporate demanders do not automatically decrease by 6 cents.
The evaluation needs to include equipment costs such as BESS, pricing structure on BESC, eligibility for farm supply, COD delays, future revisions of SAC, and transfer of REC.

In particular, at present, there are still some unresolved issues regarding the application period of 14sen, its relationship to the normal SAC review rules, and application procedures specific to acceleration packages.
We believe that the first realistic first step is to organize our company's demand, order technical, contract, and process materials from RED, and verify the feasibility calculated backwards from the end of 2028.

This article is a general compilation based on PETRA, Energy Commission, and Single Buyer materials published as of September 29, 2026. If the details of the acceleration package or the CRESS guidelines are updated, they must be reviewed in the latest materials.