Third-Party Ownership Explained

Solar PPA Malaysia: Power Purchase Agreement

A Solar PPA requires a third-party asset owner that owns the system on your roof and sells you its output per kWh. Trexon does not offer PPAs — Trexon's own routes are outright ownership (GITA-eligible) or hire purchase through a partner. See also: commercial solar, industrial solar, government solar incentives, contact us.

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3rd party

Asset Owner

Owns the system in a PPA

Per kWh

You Pay

Rate set in the contract

No GITA

For the Offtaker

Only the owner can claim

Own/Hire purchase

Trexon's Routes

Ownership or hire purchase

Understanding PPA

What Is a Solar PPA in Malaysia?

A Power Purchase Agreement (PPA) — sometimes called a Solar Service Agreement or SPPA — is a financial model where your business never buys the solar system. Instead, a third-party asset owner funds and owns the system on your rooftop, and you purchase the electricity it generates.

Think of it as a private electricity supply arrangement: you have a solar power plant on your roof, but the provider owns it, insures it, and maintains it throughout the contract term. Your role is to consume the solar electricity and pay the per-kWh rate set in the contract.

A PPA suits businesses that do not want to own the asset. The trade-off: the offtaker cannot claim GITA, and the asset owner's return is built into the rate.

No Ownership Required

You never own the panels, inverters, or any component. The provider carries the asset on their books.

Owner Carries the Asset

Repairs and performance obligations are allocated by the contract, normally to the asset owner.

Contracted Rate

The per-kWh rate is set in the contract. Whether it beats your tariff depends on the offer.

Long-Term Price Stability

A fixed or escalating rate for the contract term, whatever TNB tariffs do.

Process

How a Solar PPA Works

How a typical third-party-owned PPA runs, in five stages.

Step 01

Agreement Signed

Your business signs a PPA with a third-party asset owner. The contract sets the per-kWh rate, the term and the end-of-term options.

Step 02

System Designed & Installed

The asset owner (or its installer) designs, permits and installs the system on your roof. The asset owner funds and owns it.

Step 03

Energy Generated

The rooftop system generates electricity, and a meter measures every unit of solar energy delivered to your building.

Step 04

You Pay Per kWh

Each billing cycle you pay the asset owner for the solar electricity you used, at the contracted rate. TNB supplies the rest as normal.

Step 05

Owner Operates the System

Monitoring, maintenance and repairs follow the PPA contract, normally handled by the asset owner for the full term.

Timelines depend on the asset owner's approval process, system size and Solar ATAP / TNB connection lead times.

Comparison

PPA vs Other Solar Models

How a Power Purchase Agreement compares with outright ownership, hire purchase and rent-to-own.

Criteria	Solar PPA	Buy Outright	Hire Purchase	Rent-to-Own
Upfront Cost	Set by the asset owner	Priced per project from your bills	Per the hire-purchase terms	Per the agreement
Who Owns the System	Third-party asset owner	Your business	Per the hire-purchase terms	Provider (until buyout)
Maintenance Responsibility	Per the PPA contract	Your business (O&M contract optional)	Per the hire-purchase terms	Per the agreement
Monthly Payment	Pay per kWh used	None (post-purchase)	Fixed hire-purchase repayment	Fixed monthly rental
GITA claim	No (offtaker does not own)	Yes (owner, if deadlines met)	Depends on hire-purchase structure	Depends on structure
Offered by Trexon	No	Yes	Yes, via a partner	Residential only

Savings and payback are calculated per project from your bills. Trexon systems are priced per project.

A row of modern three-storey shoplots with solar panels covering the roof

Pricing

Solar PPA Rates in Malaysia

PPA rates are set by each third-party asset owner from your tariff, consumption profile, roof and contract term. Trexon does not offer a PPA, so it publishes no PPA rates; compare any offer against the cost of owning the system.

Fixed Rate Structure

One contracted rate for the whole term. Compare it with your current tariff and with ownership.

Escalator Structure

A lower starting rate that rises by a contracted percentage each year. Model it against your own tariff outlook.

Hybrid Structure

Fixed for part of the term, then renegotiated. Read the renegotiation terms carefully.

Eligibility

Who Is Solar PPA Best For?

Third-party ownership is discussed most by organisations with high daytime consumption, available roof space and a preference not to own the asset.

Factories & Manufacturing

High daytime electricity loads make factories ideal PPA candidates. Reduce OpEx without disrupting capital for machinery and production expansion.

Best fit: 300kWp – 2MWp

Warehouses & Logistics

Large flat roof areas and consistent lighting and cooling loads make warehouses perfect for PPA solar. Landlords can offer tenants green energy credentials.

Best fit: 100kWp – 500kWp

Office Buildings

Reduce common area electricity costs and achieve ESG reporting targets. PPA helps offices demonstrate sustainability without board-level capex approval battles.

Best fit: 50kWp – 200kWp

Shopping Malls & Retail

Massive cooling and lighting bills make malls prime PPA candidates. Reduce utility costs while marketing your commitment to clean energy to shoppers.

Best fit: 500kWp – 3MWp

Schools & Universities

Educational institutions often lack capital budgets for solar, which is why third-party ownership is discussed. Public institutions procure through their own tender processes.

Best fit: 50kWp – 300kWp

Hotels & Hospitality

Round-the-clock energy consumption and guest-facing sustainability credentials make hotels strong PPA candidates. High daytime cooling loads suit on-site solar.

Best fit: 100kWp – 500kWp

Minimum Requirements for PPA in Malaysia

System Size

Set by asset owner

Each owner sets its own minimum

Roof Condition

Structurally sound

Metal deck, concrete or fibreglass

Contract Term

15-25 years

Remaining building lease must match

Credit Standing

Good standing

Asset owner evaluates business financials

Tax Incentives

GITA Tax Benefits Under a Solar PPA

GITA (Green Investment Tax Allowance, Asset) lets the company that owns a qualifying solar system claim an allowance of 60% of qualifying capital expenditure, set off against up to 70% of statutory income. Applications go to MGTC. The capex must be incurred, the system commissioned and the application submitted by 31 December 2026.

In a PPA the third-party asset owner, not your business, owns the system, so the offtaker cannot claim GITA. If GITA matters to you:

Own the system outright — the owner is the party that can claim
Meet all three conditions by 31 Dec 2026: capex incurred, commissioned, MGTC application submitted
It is an allowance against statutory income, not a rebate
Confirm qualifying expenditure with MGTC and your tax adviser

Important: Tax treatment of PPA arrangements depends on the specific contract structure and your business's tax position. Always consult a qualified Malaysian tax advisor before making decisions based on GITA eligibility.

GITA Key Facts for 2026

Allowance Rate60% of qualifying capex

Set-Off AgainstUp to 70% of statutory income

Who Can ClaimThe company that owns the asset

Qualifying AssetsSolar PV systems, inverters, monitoring

ApplicationMGTC

DeadlineCapex incurred, commissioned and application submitted by 31 Dec 2026

Other Tax Considerations

PPA payments are generally treated as operating expenses rather than capital expenditure. How they are treated for your business depends on the contract and your tax position — confirm with your tax adviser.

FAQ

Frequently Asked Questions: Solar PPA Malaysia

Common questions from Malaysian businesses evaluating a Power Purchase Agreement.

What is a Solar PPA (Power Purchase Agreement) in Malaysia?

A Solar PPA is a contract in which a third-party asset owner owns and operates a solar system on your rooftop or property, and your business buys the electricity it generates at a per-kWh rate set in the contract, usually over a long term. A PPA therefore requires a third-party asset owner willing to fund and hold the system. Trexon does not offer PPAs. Trexon's own routes are outright ownership (GITA-eligible) or hire purchase through a partner.

How much does a Solar PPA cost upfront in Malaysia?

The upfront terms are set by the third-party asset owner in its contract, so they vary by provider and project. In a typical PPA the asset owner funds the system and recovers its investment through the per-kWh rate. Trexon does not offer PPAs. Trexon's own routes are outright ownership (GITA-eligible) or hire purchase through a partner. Every Trexon system is priced per project from your bills.

Who owns the solar system in a PPA arrangement?

The third-party asset owner owns the system throughout the contract term. This is what makes a PPA different from buying or leasing solar: the asset sits with the owner, not your business. Trexon is not a PPA asset owner.

Who handles maintenance and repairs under a Solar PPA?

Maintenance, repairs, monitoring and insurance are allocated by the PPA contract. Usually the asset owner is responsible, because it owns the equipment, but read the contract for performance and repair terms.

What happens when the PPA contract ends?

End-of-term options are set by the contract. Common options are renewing, buying the system at a price defined in the contract, or having the asset owner remove it. Check these terms before signing.

Can my business still claim GITA tax incentives under a Solar PPA?

No. GITA (Asset) is claimed by the company that owns the qualifying asset, and in a PPA that is the third-party asset owner, not the offtaker. If GITA matters to you, outright ownership is the route: the owner can claim an allowance of 60% of qualifying capex, set off against up to 70% of statutory income, provided the capex is incurred, the system commissioned and the MGTC application submitted by 31 December 2026. Consult a tax professional for your situation.

What types of businesses qualify for Solar PPA in Malaysia?

Solar PPA works best for businesses with high, consistent daytime electricity consumption. Ideal candidates include factories and manufacturing plants, large warehouses and logistics hubs, shopping malls and retail complexes, hospitals and medical facilities, universities and schools, and office buildings above 5,000 sq ft. Minimum size and credit requirements are set by each asset owner.

How does the PPA rate compare to TNB tariff in Malaysia?

The PPA rate is whatever the asset owner offers in its contract: fixed for the term or with an annual escalator. Compare it with your own TNB tariff and with the cost of owning the system. Trexon publishes no PPA rates because it does not offer a PPA.

Compare Your Options

Trexon does not offer a PPA, but we can price an owned system (GITA-eligible) or hire purchase from your bills, so you can compare it with any PPA offer you hold.

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No commitment required. Every system is priced per project from your bills.