Understanding Solar ATAP’s Offset Rate: What Is SMP (System Marginal Price)

Malaysia is entering a new era of rooftop solar with the Solar Accelerated Transition Action Programme (Solar ATAP), rolling out in December 2025. One of the biggest shifts under ATAP is how your exported solar energy is valued.
 

What is System Marginal Price (SMP)

System Marginal Price (SMP) is basically the wholesale electricity market clearing price, the price of the most expensive unit of electricity needed to meet demand at a given time.

Here’s the breakdown:

• In a power system, electricity is generated from different sources (solar, gas, coal, hydro, etc.).

• Generators submit offers (bids) to sell electricity at certain prices.

• The system operator (like a grid operator) dispatches the lowest-cost electricity first (cheapest generators run first).

• As demand rises, more expensive generators need to come online.

• The last (most expensive) generator dispatched to meet the demand sets the SMP.

This price is then paid to all generators supplying electricity at that time, regardless of their individual bid (this is how marginal pricing works).

So, SMP reflects the cost of producing the “last unit” of electricity needed to balance supply and demand.

What Changed: From NEM 3.0 to ATAP + SMP

• NEM 3.0 → Solar exports earned a 1-to-1 credit at the full TNB retail tariff (~RM0.4443/kWh for households).

• Solar ATAP → Exports are credited at SMP (wholesale energy price only), ~RM0.25/kWh in many projections.

This makes self-consumption (or using a battery) far more valuable than exporting.

Importantly, SMP only covers the Energy Charge (RM0.2703/kWh). Customers must still pay Network (RM0.1285/kWh) and Capacity (RM0.0455/kWh) charges for electricity they import from the grid.

Case Study: 6.20 kWp Solar System for a Household

Let's consider a typical Malaysian household with a 6.20 kWp solar system. This system can generate approximately 708 kWh/month, assuming an average of 3.8 sun hours per day.
 

1 Scenario: No Solar Installed (Baseline)

Monthly bill calculation:

• Energy cost: 675kWh× RM 0.4443 = RM299.87

• Fixed retail charge: RM10.00

• KWTBB (1.6%): RM 299.87 × 1.6% ≈ RM4.80

• SST (8%, since usage >600 kWh): RM 299.87 × 8% ≈ RM23.99

Total monthly bill: RM 299.87 + RM 10.00 + RM 4.80 + RM 23.99 ≈ RM338.66

This is the baseline household electricity cost before installing solar.
 

2 Scenario: NEM 3.0 (1-to-1 Export Credit)

• Assuming 30% self-consumption and 70% exported:

• Self-consumption: 202.5kWh × RM 0.4443 = RM 89.97 saved

• Exported energy at retail rate: 505.5kWh × RM 0.4443 = RM 224.59 credited

• Import energy from TNB: 472.5kWh × RM 0.4443 ≈ RM 209.93

Additional charges:

• Fixed retail charge: RM10.00
• SST 8% : RM 0.80
• KWTBB (1.6%): 10 × 1.6% ≈ RM 0.16

Final monthly bill: RM 10.00 + RM 0.16 + RM 0.80 ≈ RM10.96

Savings vs baseline: RM 338.66 – RM 10.96 ≈ RM327.70 (~97%)
 

Under NEM 3.0, exporting is as valuable as using a battery due to full 1-to-1 export credit.
 

3 Scenario: Solar ATAP Without Battery

Assuming 30% self-consumption and 70% exported:

• Self-consumption: 202.5 kWh × RM 0.4443 = RM 89.97 saved

• Exported energy at SMP: 505.5 kWh × RM 0.25 = RM 126.38 credited

      Import from TNB:

• Energy Charge : 472.5kWh x RM 0.2703 = RM 127.76
• Network Charge : 472.5kWh x RM 0.1285 = RM 60.71
• Capacity Charge : 472.5kWh x RM 0.0455 = RM 21.50

Subtotal before additional charges: RM 209.93

Net After SMP Credit : RM 209.93 - RM 126.38 = RM 83.56

Additional charges:

• Fixed retail charge: RM 83.56 + RM 10 = RM 93.56

• KWTBB (1.6%): RM 93.56 × 1.6% ≈ RM 1.50

• SST (8%): RM 93.56 × 8% ≈ RM 7.48 

Final monthly bill: RM 93.56 + RM 1.50 + RM 7.48 ≈ RM 102.54

Savings vs baseline: RM 338.66 – RM 102.54 ≈ RM236.12 (~70%)

Even without a battery, ATAP households save almost 70% of electricity bills.
 

4 Scenario: Solar ATAP With Battery (15 kWh BESS)

Assuming 30% self-consumption and 70% exported (stored in battery for later use):

• Self-consumption: 202.50 kWh × RM 0.4443 = RM 89.97 saved

• Exported energy stored in battery (offset later): 505.5 kWh × RM 0.4443 = RM 224.61 

• Remaining energy from TNB: 0 kWh = RM 0.00

Subtotal before additional charges: RM 0.00 – RM 0.00 = RM 0.00

Additional charges:

• Fixed retail charge: RM10.00

• KWTBB (1.6%): RM 10.00 × 1.6% = RM 0.16

• SST (8%): RM 10.00 × 8% = RM 0.80

Final monthly bill: RM 10.00 + RM 0.16 + RM 0.80 ≈ RM 10.96

Savings vs baseline: RM 338.66 – RM 10.96 ≈ RM327.70 (~97%)

Battery maximizes self-consumption, reducing bills almost entirely.

Battery sizing tip: A 15 kWh battery covers the full daily surplus (~15.75 kWh/day), ensuring maximum savings.

Comparison Table

ROI calculation:

• ROI = System Price ÷ Annual Savings
• Annual Savings = Monthly Savings × 12
   

Key Takeaways

• NEM 3.0 offered 1-to-1 retail credit, making batteries optional.

• Solar ATAP credits exports at SMP (energy only). With 70% night usage, savings without storage fall to ~70%.

• A battery system (15 kWh) restores savings to ~97% by shifting solar to nighttime use.

• ATAP makes self-consumption + batteries the most effective way to reduce electricity bills.

Final Thoughts

Solar ATAP represents a major step forward in Malaysia’s clean energy transition, offering households the opportunity to significantly reduce electricity bills while supporting sustainable energy use. Although the SMP reduces the value of exported energy compared to NEM 3.0, households can still achieve near-zero electricity bills by maximizing self-consumption and integrating a battery storage system.

For homeowners and businesses looking to make the most of Solar ATAP, Solar Sunyield provides expert guidance from system design and installation to battery integration, ensuring every kilowatt of solar energy is effectively utilized. With our solutions, you can save on electricity, optimize your energy usage, and take a proactive step toward a sustainable, energy-independent future in Malaysia.