TL;DR:
- On 9 January 2026, China's Ministry of Finance abolished the 9% VAT export rebate on solar PV products, effective 1 April 2026 — ending a subsidy that had kept global module prices artificially low for years.
- Because Malaysia sources the vast majority of its PV modules from China, every landed solar panel price in Malaysia is now higher than quotes issued in mid-2025.
- A parallel surge in silver prices is compounding the cost pressure independently of the VAT policy change — silver paste now accounts for up to 30% of total cell production costs.
- Analysts expect a gradual but sustained upward pricing trajectory across Southeast Asia through 2026; a return to 2024 lows is not anticipated.
- The most practical step available now is to request a fixed, itemised quote based on a proper site assessment — locking in today's cost basis before the next round of adjustments comes through.
Solar quotes issued today cost more than those from 6 months ago — and the gap is not negotiable margin. A policy decision confirmed by China's Ministry of Finance in January 2026 removed the export subsidy that had kept global PV module prices artificially suppressed for years. For Malaysian buyers, who depend on Chinese modules for the vast majority of installations, the impact is direct: higher solar panel prices in Malaysia, with further movement still working through the supply chain.
Why China Removed the VAT Export Rebate on Solar Products
For years, the Chinese government returned a portion of the value-added tax (VAT) paid during manufacturing back to exporters — effectively subsidising the cost of every module that left the country. For solar products, that rebate stood at 9% of the export value. On 9 January 2026, China's Ministry of Finance and State Tax Administration announced it would drop that rebate to zero from 1 April 2026.
Chinese manufacturers had been locked in a prolonged price war, with module prices falling to historic lows of around USD 0.07 to USD 0.09 per watt by 2024. The VAT rebate was part of what made those prices commercially viable for exporters — absorbing a portion of the manufacturing cost that would otherwise have been passed to buyers. According to the China PV Industry Association, China's PV export value totalled USD 24.42 billion from January to October 2025, with approximately USD 2.2 billion in annual rebate value involved at the 9% rate.
Once that buffer is gone, the cost manufacturers previously recovered from the government has to be recovered from somewhere else — and that somewhere is the price on your installation proposal.
How the Rebate Removal Affects Solar Panel Price in Malaysia
Industry data places module prices at around USD 0.08 to USD 0.09 per watt FOB China in late 2025. Jinko Solar indicated at the start of 2026 that prices were expected to rise by as much as 30 to 40% as the VAT removal, raw material costs, and supply chain adjustments worked through the market. OPIS data from May 2026 puts the FOB China benchmark at approximately USD 0.117 per watt — and before freight, import duties, and installer margins are applied on top, that movement is already significant at the landed cost level in Malaysia.
Malaysia feels this more directly than some other markets. The country sources nearly all of its PV modules from China, with no ready alternative supply base of comparable scale. When Chinese export prices move, Malaysian landed costs move with them.
| Cost Factor | Late 2025 | 2026 |
| VAT rebate on modules | 9% | 0% |
| Module price FOB China | ~USD 0.08–0.09/W | ~USD 0.117/W |
| Silver's share of module cost | ~12% | ~17% |
The repricing did not wait for April. Manufacturers began adjusting prices in January 2026 as soon as the policy was confirmed. Quotes issued now reflect a market that has absorbed the full removal.
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Request a fixed, itemised solar quote based on a real site assessment — not a generic range — and lock in today's cost basis before the next adjustment.
Why the PV Module Pricing Trend in Southeast Asia Points Further Upward
The VAT removal is not the only cost driver in play. Silver — a critical input in solar cell manufacturing — surged to a record USD 83.62 per ounce in late 2025 and has remained elevated into 2026. As reported by PV Magazine, silver paste now accounts for up to 30% of total cell production costs, overtaking polysilicon as the single largest cost component in modules. OPIS analyst Hanwei Wu notes that the combined effect of elevated silver prices, rising wafer costs, and the removal of export rebates represents a rare convergence of upward cost pressure — one that is pushing production costs higher independently of any single policy decision.
Southeast Asia had benefited for years from Chinese overcapacity keeping prices at unsustainably low levels. That period is ending. For commercial and industrial projects where equipment procurement accounts for a significant share of total cost, the question is not whether prices will eventually stabilise — they will — but whether you are buying at today's price point or a later, higher one.
What Can Homeowners and Businesses Do Before Prices Move Again?
The most immediate action is to get a quote on the table now — one based on your actual system size and roof, not a ballpark figure. This locks in today's equipment pricing even if you are not ready to commit to installation immediately.
Here is what to have in order before you engage an installer:
- Get a Site-Assessed Quote: Tied to your actual roof, consumption profile, and system size — not a per-kW estimate.
- Check GTFS Eligibility: Malaysia's Green Technology Financing Scheme offers subsidised interest rates through participating banks in 2026.
- Register Under Solar ATAP: Launched 1 January 2026 under PETRA, this open-application programme offers 10-year contracts and export credits against your TNB bill, with no quota limit.
- Apply for GITA (Commercial Buyers): The Green Investment Tax Allowance provides a 100% investment tax allowance on qualifying solar expenditures, extended through 2026.
A well-sized system in Malaysia typically delivers a payback period of 5 to 8 years — though this varies under Solar ATAP, where unused monthly export credits expire within the billing cycle. What changes as solar panel prices in Malaysia rise is not whether solar makes financial sense — it is how long recovery of the upfront cost takes. The fundamentals remain sound; the timing is what matters now.
Get a Fixed Solar Panel Price Quote from Northern Solar
As a SEDA GCPV-certified EPCC provider with in-house engineers and licensed chargemen, Northern Solar issues fixed, itemised quotes based on a proper site assessment — giving you a clear solar panel price in Malaysia tied to your actual system requirements, not a generic range.
Whether you are sizing a residential rooftop, a commercial facility, or an industrial installation, the starting point is the same: a site assessment and a proposal that reflects current market conditions, before the next round of price adjustments comes through.
Request your free consultation today and lock in a solar panel price in Malaysia that reflects what the market looks like now — not what it will look like in 6 months.
