Revised standby charges and a deferred BESS mandate for SELCO users

Malaysia has revised the rules for its Solar for Self-Consumption (SELCO) scheme, which lets commercial and industrial users generate solar power for their own on-site use. After industry pushback against the first version, the Energy Commission issued updated guidelines on 27 March 2025 that lift the thresholds, cut the standby charge and defer a storage requirement.

Under the original guidelines effective 1 January 2025, non-domestic systems above 72 kWp faced a standby charge of RM14 per kWp each month and a battery-storage requirement. The revised terms exempt systems below 1 MWp from the standby charge entirely, reduce the rate to RM12 per kWp, and raise the storage threshold so that only systems above 1 MWac must add batteries.

The battery mandate itself has been deferred to 1 January 2026, provided a project completes its solar installation, fulfils the relevant forms and submits its licence application by the end of 2025. Higher-education institutions with installs of 1 MWp or more are exempt from both the standby charge and the storage requirement, and an earlier 85 percent demand cap has been removed.

For the bulk of the commercial rooftop market, those under 1 MWp, the revision removes a significant upfront cost and improves solar payback. For the largest sites, storage is not cancelled but merely delayed, so developers of big installations still face a hard integration deadline from 2026 and a clear incentive to plan for batteries early.