Kuala lumpur: Kenanga Investment Bank Bhd (Kenanga IB) anticipates that the renewable energy sector will experience a bustling first quarter in 2026, driven by the anticipated rollout of solar bids under the Large-Scale Solar (LSS) 6 programme. The bank highlighted this outlook in a research note, pointing to strong visibility for LSS construction awards, with LSS5+ projects advancing into the construction phase as well.

According to BERNAMA News Agency, Kenanga IB indicated that the Solar Accelerated Transition Action Programme (Solar ATAP), which replaces the expired Net Energy Metering (NEM) 3.0 programme, was introduced at the end of 2025. This initiative is expected to boost adoption momentum in the retail sector, with applications set to start from January 1, 2026.

Kenanga IB also noted that 1Q 2026 will see bidding activity for an additional quota under the feed-in-tariff of 300 megawatts (MW), starting from February. The Corporate Renewable Energy Scheme (CRESS) is expected to be attractive for data centres seeking long-term energy solutions at competitive rates, with a committed value to CRESS reaching 1.3 gigawatts (GW) by June 2025.

The bank emphasized that successful execution is crucial, with players capable of scaling quickly through partnerships and having a strong execution track record likely to gain an advantage. Corporates are also securing solar panel prices to mitigate margin pressure in advance.

Furthermore, Kenanga IB mentioned that discussions on the climate change bill, which will address carbon tax implementation, are anticipated during the first parliamentary sitting of 2026. This could stimulate interest in the renewable energy sector. Kenanga IB continues to maintain an 'overweight' call on the sector, recognizing its fast-growth phase.