Effectiveness of REEMs in Malaysia (Part 2): Key Actors

Personally, there are companies send me enquiries on REEM services that I am also offering as one of our consultancy services. I would say almost all of them just interested to appoint REEM for the purpose of compliance only and looking for the "best price" which normally the cheapest price.

Some of them already received warning notices but still do not take it as an urgent matter yet.Why? I will try to elaborate on the later or sometime in the future posts  since my focus now in on REEM.

Both REEMs and affected companies need to be guided and the only party who can do that is the regulator itself because what is happening now is the true spirit of EMEER 2008 is not fully understood for them to see the positive impacts that could be resulted from the enforcement of the law. There must me a scynchronized efforts among the regulator, REEMs and affected companies to act on roles as specified in the law  for us to see the actual desired impacts from the introduction of EMEER 2008.

The diagram below summarized roles that need to be played by each actor in EMEER 2008 implementation to enable the law to achieve its objectives.


Relationship and roles of key actors in EMEER 2008 implementation

Obviously the biggest roles that need to be played is by the regulator especially in the early part of the implementation. The regulator must have strong and competent EE capacity within the organization to enable them to perform their functions effectively especially when installations and REEMs refer to them for clarity about provisions in the law and assistance on how to practically move towards the compliance.

The other biggest challenge of the regulator is to create significant interest among the technical people to apply to become REEM, to register them and to ensure REEMs will play their roles after that. With less than 200 REEMs registered at this moment, it definitely insufficient for the market and with many of REEMs are based on their existing workplace as a full time employees, the total number of REEM that would be able to ensure at least the compliance is far less than enough. This has already created unhealthy environment in REEM market when the demand is too much more than the supply where some REEMs are willing to rush the quantity rather than the quality of services delivered.

On-going campaign to increase awareness on the potential of new carrer and business opportunities is required to attract more EE professionals, practitioners and others with related EE working experience to apply to become REEM.

To become REEM under EMEER 2008, you do not have to a technical specialist or specialized in other areas in EE.Then, appointment of REEM by any company for the purpose of compliance only will not gurantee any energy cost reduction yet. However, being a specialist in certain areas especially on how to identify and implement energy cost saving measures definitely will bring more values to companies appointed them as REEM at their facilities. I will try to share some tips in my future postings on how easy to become REEM is you already met the qualification requirements and experiences in energy efficiency.
REEMs normally will ask  and share information and experiences their fellow REEMs on what they actually do to secure , deliver their services and to maintain their clients. Meanwhile companies will normally refer to the regulator to confirm about the requirements to compy and then REEMs in the market to gauge what  type of services could be offered and fees.Companies also will ask other companies and finally they will decide based on their actual needs to appoint REEM. Without a proper advise and guidelines, companies may end  up appointing REEM with their own reasons and not in tandem with the objectives of EMEER 2008 implementation. This scenario must closely monitored by the regulator and to close the gaps on different perceptions and assumptions by companies and REEMs about complying towards EMEER 2008.

The general understanding about EMEER 2008 is they need to implement energy saving measures which is not totally correct since the focus of the law is on the management of energy at  the affected installations. This is where the regulator need to explain clearly and extensively to them that the law is not all about energy savings. EMEER 2008 is actually focusing on the management component of total energy management solutions which also cover the technical component which direcly related to energy saving measures.When the energy resources is being managed efficiently, it will subsequently wil result in identifying ways to eliminate wastage that will improve energy resources utilization in the facilities.

To put so much emphasis on energy savings will create the impression of quickly to jump into possible immediate measures to be impelemented if they need to comply to EMEER 2008 and measures can be quickly associated with costs to implement too which shift the attention to EE technologies(products).

Effectiveness of Registered Electrical Energy Managers( REEMs) in Malaysia (Part 1)

Updated as at 28 September 2012,194 Registered Electrical Energy Manager with Energy Commmision are to ensure compliance to the existing EE law.

 

To start...just like any other law , the enforcement and monitoring by the regulator is also crucial to ensure the good impacts that could be resulted from EMEER 2008 compliance. 

EC at least need to have the in-house capacity and competent people in EE implementation who at least can guide the affected installations and REEMs for them to be able to look into the actual spirit behind EMEER 2008 rather than just for compliance. EC's roles in educating the installations in directly linked to REEMs that they have certified as their "representive" because if REEMs are not able to convince the installations about tge benefits from compliance with EMEER 2008, EC is left alone to do it. 

This is another one reason why REEMs are so crucial to ensure the success of EMEER2008 implementation. 

Now, let us examine their effectiveness to promote EE...at least at with installations that they appointed according to the requirements of EMEER 2008.

The Efficient Management of Electrical Energy Regulations was effective from 15 Dec 2008 and it affcects consumers and private licencess who consume or generate more than 3,000,000kWh in total in 6 consecutive months at any duration from the effective date.

Two key features in the regulations are: 
1. Affected consumers/private licensees must appoint Registered Electrical Energy Manager (REEM)with EC and... 

2. also required to submit energy management info and updates in a scheduled report to EC in every 6 months 

Key duties of REEM in efficient management of energy in general are:

1. To advise on how to implement 

2. To audit 

3. To monitor the implementation 

4. To supervise records and documents are kept 

5. To ensure timely submission of the scheduled report by the installation 

Currently there are about almost 1500 installations affected by the regulations and I am aware that EC has started to send warning notices to those who have not comply since 2011 

Please log on into EC's website www.st.gov.my for more info

Based on feedback by some affected installations and also REEMs in the market, we can classify REEMs in few categories now:

1. appointed as REEM at the installation where he/she is working now(I guess the most of REEMs) for compliance 

 

2. Appointed as the third party as REEM by affected installations they can be appointed by more than one installations. This group normally consultants. 

 

3. Not appointed any installation and just keep the certificate as one of their competency recognition 

Comparatively with other country that have similar competency certificate by EE laws such as Japan and India, to become REEM is much more easier due to a very "minimun" requirements in EMEER 2008 for academic qualifications, knowledge and experiences in EE. All that they need to have are at least  degree in engineering, architecture and science with experiences in energy management from 6 months to one years plus an interview session before they can be registered if they pass the interview.

 

 

The main concern is....how competent of REEMs in promoting and assisting to implement EE for the affected installations and for other intensive energy users as a whole.

Functions and duties of REEM in EMEER 2008 are very general and in can be intrepreted in many ways if not being well explained and guided by the regulator. The key of EMEER 2008 is to ensure energy resources(electrical) is managed efficiently and REEMs are expected to play the critical role for that to happen...

 

How many installation for REEM can be appointed? How much should REEM charge for each installation? How much should I for REEM services? Will REEM help to save energy? Is energy audit is compulsory and if yes, what type of energy audit that need to be carried out? detailed, investment grade or walk through? 

It ia very crucial for REEMs to be able understand their "real" functions & duties clearly and convincingly since provisions stated in EMEER 2008 are very brief and general...their ability to do that nornally will determine what type of REEM they would be that will lead to what type services to delivered to installations that agreed to appoint them. 

To me...the compliance of affected installations towards EMEER 2008 should only be the minimum requirement for REEM to fulfill which is to verify reports that need to be submitted to EC in every six months.Their further functions should derive from the regulation 16 in EMEER 2008 which is not fully understood the owner of the installation who are mostly new or unaware of it until they received the notification from EC. 

 

To my understanding, the spirit of EMEER 2008 is more to give the freedom to each installation to manage their energy efficiently.It can be seen with so many general provisions and minimum mandatory requirements that need to be complied.That actually give the flexibility to REEM to figure out the best or the most practical package to offer other than just for compliance... 

We will look into this topic furher since this will determine the tangible values and benefits in the appointment of REEM in the eye of the installation's owner with the amount of fee that they are willing to pay.

 

From the market information and communications with some of fellow REEMS ...there are REEMs being paid from about RM500 per month to RM50k+++ per year for services offered to affected installations with about 400 installations have appointed REEM.There are REEMs appointed to many installations and the highest number for one REEM that being told to me is about 20 installations. I am not going to question about the fees or how many installations for each REEM can be appointed, as a REEM myself, I would to discuss on how every REEM will or should position themselves in the market and how as REEMs, and then we would be able to promote efficient management of energy that will benefit the installation itself and the country as a whole. It's free market and everyone has absolute rights to find the best way to secure clients. 

There are few types of installations too when it comes to on how they look at EMEER 2008.Generally I would like to categorize them as follows: 

1. Just would like to comply to avoid issues with the authority,their certificaton requirements and etc.Management of energy it is no so critical to them especially for purely local companies. 

2.Ready to comply since energy management have been implemented for many years 

3.Want to comply but delayed their actions due to other important commitment and in the same time findings it hard to get REEMs due to insufficient supply and unsure about how much values REEM will bring with the costs that they need to fork out.They are also raised concerns on lack of reference/guidance/benchmark on the scope of works of REEM to deliver with proposed fees. 

4.With wait and see attitude...trying to delay it if possible 

5.Just do not care at all 

6. The management are not aware about it at all 

7. Keen to comply and immediately and taking necessary actions to indicate their on-going commitment as "green" or law abiding organizations 

There are may be more but what I am going to highlight here are...firstly, for different type of organizations, REEMs have to have different approache to sell themselves to get appointed with the suitable scope of works to fulfill each installation's requirement and their perception towards EMEER 2008.Secondly, how REEMs position themselves in the market will create the perception towards them among the affected installations as a whole and companies that appointed them, fellow REEMs and also from the regulator's point of view. 

 

I came across installations that we have EE projects with them that shared with us some of their experiences with REEMs that they have appointed.For companies that appointed REEMs from their qualified internal personnel, normally they do not have that many issues with their REEMs. Negative comments normally come from companies that appointed external REEMs that could not see or realize the benefits despite paying certain amount of fees on monthly basis other than complying to EMEER 2008.