Solar Photovoltaic Adoption in a Malaysian Small and Medium Enterprise: An Exploratory Case Study

Abstract

Renewable energy focuses on transforming natural energy, such as solar energy that uses advanced technology to replace conventional energy by producing cleaner energy for reducing carbon emissions. Malaysia receives average solar radiation of 400-600 MJ/m2 per month, which has a high potential to harness solar energy. However, only 2% of Malaysia's energy was generated by renewable energy sources in 2019. Even though incentives have been introduced by the Malaysian government to encourage small and medium enterprises (SMEs) to install solar photovoltaic (PV) systems on their rooftops, the take-up for the installation among SMEs is still at a slow pace. Hence, questions arise as to whether the SMEs would adopt the solar PV system since they have traditionally been recognised as late adopters of advanced technology. This paper presents the case of Company ZKY, one of the Malaysian SMEs, to explore their reasons for adopting a solar PV system. The findings suggest peer influence, top management support, ability to obtain a loan and expected return on investment, and benefit of the solar PV system itself as to why the company's adoption of a solar PV system occurs. This paper provides insights into the initial effort to explore the basis for a solar PV system adoption in a Malaysian SME. The outcomes bring forth valuable lessons to drive the adoption of the solar PV system among Malaysian SMEs.