UEM Lestra Bhd, the green investment arm of Malaysia’s sovereign wealth fund Khazanah Nasional Bhd, has announced plans to invest RM2.5 billion in the first phase of a landmark solar energy project in Johor. The company has already secured key offtakers for the project, which is slated to begin operations by the end of 2027.
The initial phase of the solar facility, located on a sprawling 1,700-acre site in Segamat, will feature an estimated capacity of 750 megawatt peak (MWp) and be supported by a battery energy storage system. Hong Kong-based real estate giant ESR Group Ltd has been identified as one of the principal offtakers, UEM Lestra confirmed in a statement.
According to the company, a bilateral electricity supply agreement is expected to be finalized in the coming months. The solar plant represents a flagship initiative of Malaysia’s National Energy Transition Roadmap and is the first project under the government’s Corporate Renewable Energy Supply Scheme (CRESS), launched in September 2024. The CRESS framework is designed to offer corporate consumers enhanced access to green electricity options through third-party agreements.
“These initiatives not only address the growing demand for renewable energy among corporate offtakers but also reinforce Malaysia’s commitment to a sustainable future,” said Harman Faiz Habib Muhamad, CEO of UEM Lestra. He also highlighted the involvement of ESR Group as a key factor in bolstering the project’s commercial and environmental viability.
The development marks a significant milestone for UEM Lestra, which is a wholly owned subsidiary of UEM Group Bhd under Khazanah’s umbrella. The company had previously entered a 51:49 joint venture with HEXA Renewables, a renewable energy platform managed by US-based I Squared Capital, to drive the project forward.
With its hybrid solar and energy storage capabilities, the Segamat plant is expected to set new benchmarks in Malaysia’s transition towards renewable energy. It aims to meet the rising demand for green electricity among corporate consumers while supporting the nation’s broader energy transition goals.
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