Solar payback in Malaysia depends mainly on your bill. On the RP4 tariff (from 1 July 2025), a RM300 bill pays back a 5.58 kWp system in about 7.2 years, a RM500 bill pays back a 7.44 kWp system in about 5.2 years, and homes with bills under RM200 take 11 years or more. Here are the formula, worked examples and the assumptions behind them.
Solar Panel ROI Formula: The Complete Calculation
Return on Investment (ROI) for solar panels combines avoided costs (electricity you no longer buy from TNB) and export credits (Solar ATAP credits at the Energy Charge for power you export).
| Formula Component | Description | Example (7.44 kWp, RM500 bill) |
|---|---|---|
| Total Investment | Catalogue system price | RM 17,999 (Solis) |
| Annual Savings | Monthly savings x 12 | RM 291 x 12 = about RM 3,492 |
| Payback Period | Total Investment / Annual Savings | RM 17,999 / RM 3,492 = about 5.2 years |
| Simple annual return | (Annual Savings / Investment) x 100 | (RM 3,492 / RM 17,999) x 100 = about 19% |
| 25-Year Savings | Self-use savings for 25 years, export credit for the 10-year Solar ATAP contract | about RM 69,120 |
Assumptions: Estimate on the RP4 domestic tariff (from 1 Jul 2025), before AFA, the 1.6% RE Fund and service tax; 3.5 sun-hours a day; about 40% of solar used at home and the rest exported and credited at the 27.03 sen Energy Charge (capped at what you import) for 10 years under Solar ATAP; no tariff increases. Your bill and roof will change the figures. Unused export credit is forfeited at the end of each billing period; it does not carry over.
Worked ROI Examples by Bill Size
There is no exact 4 kW or 5 kW package; our 10 kW-class package is 10.54 kWp. Each example uses the size our savings engine matches to the bill. Prices are Solis; Huawei adds RM3,000 and Sungrow adds RM5,000.
RM200 Bill (about 556 kWh a month): 5.58 kWp, RM 15,999
- Monthly Generation: 586 kWh (about 234 kWh used at home, 352 kWh exported)
- Bill: RM 200 before solar, about RM 57 after (export credit about RM 87)
- Monthly Savings: about RM 143
- Annual Savings: about RM 1,716
- Payback Period: about 9.3 years
- 25-Year Savings: about RM 39,480
RM300 Bill (about 739 kWh a month): 5.58 kWp, RM 15,999
- Monthly Generation: 586 kWh (about 234 kWh used at home, 352 kWh exported)
- Bill: RM 300 before solar, about RM 116 after (export credit about RM 95)
- Monthly Savings: about RM 184
- Annual Savings: about RM 2,208
- Payback Period: about 7.2 years
- 25-Year Savings: about RM 44,760
RM500 Bill (about 986 kWh a month): 7.44 kWp, RM 17,999
- Monthly Generation: 781 kWh (about 312 kWh used at home, 469 kWh exported)
- Bill: RM 500 before solar, about RM 209 after (export credit about RM 127)
- Monthly Savings: about RM 291
- Annual Savings: about RM 3,492
- Payback Period: about 5.2 years
- 25-Year Savings: about RM 69,120
RM1,063 Bill (about 1,695 kWh a month): 11.78 kWp, RM 25,999
- Monthly Generation: 1,237 kWh (about 495 kWh used at home, 742 kWh exported)
- Bill: RM 1,063 before solar, about RM 442 after (export credit about RM 201)
- Monthly Savings: about RM 621
- Annual Savings: about RM 7,452
- Payback Period: about 3.5 years
- 25-Year Savings: about RM 150,120
How the RP4 Tariff Affects Your Solar ROI
Since 1 July 2025, the domestic General tariff is no longer tiered by block. The charges are:
TNB Domestic General Tariff (RP4, from 1 July 2025)
| Charge | Rate |
|---|---|
| Energy Charge | 27.03 sen/kWh (up to 1,500 kWh a month); 37.03 sen/kWh for all kWh above 1,500 kWh a month |
| Capacity Charge | 4.55 sen/kWh |
| Network Charge | 12.85 sen/kWh |
| Retail Charge | RM10 a month (waived at 800 kWh or less until 31 Dec 2026) |
| Energy Efficiency Incentive | For 1,000 kWh a month or less: a rebate of 25.0 sen/kWh (1-200 kWh) falling to 0.5 sen/kWh (901-1,000 kWh), by total monthly use |
AFA is set monthly (homes using 800 kWh or less are exempt until 31 Dec 2026). The 1.6% RE Fund applies except to homes using 300 kWh or less, and 8% service tax applies only to homes above 800 kWh.
What Solar Actually Saves
Solar used at home avoids the Energy, Capacity and Network charges: RM0.4443/kWh, or RM0.5443/kWh above 1,500 kWh a month (before Energy Efficiency Incentive effects). Power you export is credited at the Energy Charge only: RM0.2703/kWh (RM0.3703 above 1,500 kWh). So every kWh you use at home is worth more than a kWh you export, and the credit can only offset your bill; it cannot exceed it.
Solar ATAP vs Self-Consumption
Same RM500 bill and 7.44 kWp system, with a different share of solar used at home (30% and 50% self-use cases around our 40% default):
| Solar used at home | Monthly saving |
|---|---|
| 30% | about RM 277 |
| 40% (our default) | about RM 291 |
| 50% | about RM 305 |
Optimization Tip: Maximize daytime use by:
- Running washing machines, dryers and dishwashers in the daytime
- Charging an EV during the day if you have a home charger
- Putting pool pumps and water heaters on daytime timers
Solar Panel ROI by Payment Method
Using the RM500 bill / 7.44 kWp example (RM 17,999, saving about RM 291 a month):
Method 1: Cash Purchase
- Investment: RM 17,999
- Payback: about 5.2 years
- Best for: Buyers whose savings earn little elsewhere
Method 2: Bank Solar Financing
Maybank Solar PV Financing offers up to RM100,000 for up to 10 years at a floating rate (Maybank's own illustration: SBR + 2.70%). Check the current rate and terms on the Maybank Solar PV Financing page, and the product page of any other bank you consider. Your repayment depends on the rate you are offered, so compare it with the monthly saving above.
Method 3: Credit Card 0% Instalment (up to 24 months)
- At Trexon's checkout, pay by credit card and choose a 0% plan: Affin, AmBank, HSBC, RHB and Standard Chartered offer 3/6/12/24 months; Alliance, OCBC and UOB offer 6/12/24 months.
- Example: RM 17,999 over 24 months is about RM 750 a month, interest RM 0.
- Note: Maybank 0% EPP is not available through Trexon. Your card limit and bank approval apply.
Hidden Factors That Change ROI
1. SuRIA Home Rebate (Residential)
Malaysian citizens with a residential TNB account may receive the SuRIA Home rebate of RM600 per kWac, capped at RM3,000, paid to the TNB account holder. TNB notifies eligible customers; there is no customer application. It is not included in the payback figures above.
2. Tax Allowance (Companies Only)
Companies, not homeowners, may claim the GITA Asset allowance: 60% of qualifying solar PV capex (Tier 2), set off against up to 70% of statutory income each year, with unused allowance carried forward. The asset must be commissioned and the application submitted to MGTC by 31 Dec 2026. Subject to MGTC verification.
3. Tariff Changes
We assume no tariff increases. If TNB's charges rise, solar savings rise with them; if they fall, savings fall.
When Solar Panel ROI Makes Sense
Solar is a strong yes if:
- Your monthly TNB bill is RM500 or more (payback about 6 years or better)
- You plan to stay in the property for at least 6 to 8 years
- Your roof has unshaded area for the system you need
Solar can still work if:
- Your bill is RM300 to RM400 a month (payback about 7 years for RM300, about 5.2 to 6.2 years for RM400 to RM500)
- You plan to buy an EV and can charge in the daytime
Solar may not make sense if:
- Your bill is under RM200 a month (payback 11 years or more)
- You are renting or plan to move within a few years
- Your roof is mostly shaded
- You live in a high-rise without roof access
DIY Solar ROI Calculator (Step-by-Step)
- Find your average monthly kWh: _____ kWh (on your TNB bill)
- Pick the nearest catalogue size: a system generates about kWp x 105 kWh a month (for example 7.44 kWp makes about 781 kWh)
- Get the price: from the catalogue (7.44 kWp Solis: RM 17,999)
- Estimate monthly saving: solar used at home x RM0.44 (RM0.54 above 1,500 kWh) + exported kWh x RM0.27 (RM0.37 above 1,500 kWh), capped at your bill
- Payback: price / (monthly saving x 12) = _____ years
Example: RM500 bill with 7.44 kWp at RM 17,999: about RM 291 a month, about 5.2 years payback.
FAQ: Solar Panel ROI Malaysia 2026
What is a good ROI for solar panels in Malaysia?
On the RP4 tariff, a simple annual return of roughly 11% to 28% is typical, depending on your bill: about 11% for a RM200 bill, about 14% for RM300, about 19% for RM500 and about 28% for a RM1,000 bill. Compare this with the rate on a fixed deposit or other options you have.
How long is the payback period for solar panels in Malaysia?
About 9.3 years for a RM200 bill, about 7.2 years for RM300, about 5.2 years for RM500 and about 3.6 years for a RM1,000 bill, using the assumptions above. Higher bills pay back faster because more of your solar is worth the full RM0.44 to RM0.54 per kWh.
Is solar better than a fixed deposit or ASB?
Solar returns come as lower electricity bills over 25 years, not as interest, and the figures depend on your bill. Compare the simple annual return above with the current rate your bank or fund offers, remembering that solar's return is not guaranteed.
Does Solar ATAP affect solar panel ROI?
Yes. Solar ATAP credits exported power at the Energy Charge (RM0.2703/kWh for homes up to 1,500 kWh a month), offset against your bill. Unused credit is forfeited each billing period, so sizing the system to your daytime use matters. ATAP does not reduce what you pay upfront.
Can I finance solar panels in Malaysia?
Yes. Maybank Solar PV Financing is available up to RM100,000 for up to 10 years (floating rate). You can also pay by credit card with a 0% instalment of up to 24 months at Trexon's checkout. Check the bank's current terms.
Conclusion: Let Your Own Bill Decide
Solar ROI on the RP4 tariff ranges from about 9.3 years' payback for small bills to under 4 years for large ones. The bigger and more daytime-heavy your usage, the better solar performs.
Ready to calculate your personalized ROI? Use our solar calculator for instant payback and savings estimates, or get a free quote.
Once you are ready to move forward, choosing the right installer matters as much as the numbers. Read our guide to choosing a solar company in Selangor to understand what to look for and avoid costly mistakes.
