EECA 2024 Compliance: A Simple Checklist for Malaysian Businesses

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EECA 2024 Compliance: A Simple Checklist for Malaysian Businesses.

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Key Takeaway: The Energy Efficiency and Conservation Act (EECA) 2024 is now in force in Malaysia, making energy efficiency a legal requirement for many businesses and large buildings. This law goes beyond just saving money; it's about making our nation more sustainable. This guide provides EECA 2024 Compliance: A Simple Checklist for Malaysian Businesses, helping you understand if your company is affected and what steps you need to take to avoid penalties and unlock new benefits.

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Problem: Has the new Energy Efficiency and Conservation Act (EECA) 2024 landed on your desk, leaving you wondering what exactly your business needs to do?

Agitate: This isn't just another piece of paperwork; non-compliance with EECA 2024 can lead to significant fines, impacting your bottom line and reputation. Many businesses aren't sure if they're affected or where to even begin.

Solve: Don't get caught unprepared! This article provides EECA 2024 Compliance: A Simple Checklist for Malaysian Businesses, breaking down who is affected, what the key requirements are, and how you can easily navigate this new legal landscape to ensure your operations are compliant and energy-efficient.

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Summary

The Energy Efficiency and Conservation Act (EECA) 2024, officially effective since January 1, 2025, replaces previous regulations and expands the focus to include both electrical and thermal energy. It primarily targets two groups: "Energy Consumers" (industrial/commercial businesses using 21,600 GJ/year or more) and "Persons in Charge of Buildings" (office buildings with a Gross Floor Area of 8,000 sqm or more). Key compliance steps include appointing a Registered Energy Manager (REM), implementing an Energy Management System (EnMS), conducting regular energy audits, submitting annual reports, and for buildings, displaying an Energy Intensity Label. Following this EECA 2024 Compliance: A Simple Checklist for Malaysian Businesses is crucial to avoid penalties and capitalize on energy savings.

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1. What is the EECA 2024 and Why Does it Matter to Your Business?

Let's start with the basics. The Energy Efficiency and Conservation Act 2024, or EECA 2024, is Malaysia's new big law about using energy wisely. It officially came into force on January 1, 2025. This new law replaces an older set of rules called the Efficient Management of Electrical Energy Regulations 2008 (EMEER 2008). This is a big deal because it covers much more than just electricity; it also includes thermal energy, like heat from natural gas, steam, or diesel.

Why did Malaysia introduce this law? It's part of our national promise to become a more sustainable country. Our goal is to achieve Net-Zero Greenhouse Gas Emissions as early as 2050. By making businesses use energy more efficiently, the EECA 2024 aims to:

• Reduce energy waste: Stop throwing money away on inefficient processes.
• Lower energy consumption: Use less electricity and fuel overall.
• Cut carbon emissions: Help fight climate change by releasing fewer harmful gases.
• Boost national energy security: Rely less on imported energy and ensure Malaysia has enough power for its future.

So, if your business uses a lot of energy, this law directly affects you. Understanding EECA 2024 Compliance: A Simple Checklist for Malaysian Businesses is your first step to being ready.

 

2. Are You an "Energy Consumer" or a "Person in Charge of a Building" under EECA 2024?

The EECA 2024 doesn't apply to every single business or building. It's focused on those that use a significant amount of energy. The Energy Commission (EC), which is the government body in charge of enforcing this law, will likely identify and notify businesses that fall under these categories.

There are two main groups of businesses that need to pay close attention:

• Group 1: "Energy Consumers" (Industrial and Commercial Businesses)
• Who it is: This generally applies to factories, large manufacturing plants, data centers, and big commercial operations.
• The Threshold: Your business is considered an "Energy Consumer" if it uses 21,600 Gigajoules (GJ) or more of energy per year.
• To give you a better idea of what 21,600 GJ means:
• It's roughly equal to an annual electricity bill of around RM2.4 million.
• Or, if you use natural gas, it's about RM1 million in annual gas bills.
• This consumption includes both electrical and thermal energy (like natural gas, diesel, steam, chilled water).
• What happens if you're in this group: The EC will notify you in writing. Once notified, you have a set period to start meeting the requirements, which we'll cover in the next section.
• Group 2: "Persons in Charge of a Building" (Large Office Buildings)
• Who it is: This applies to owners or managers of large office buildings or complexes.
• The Threshold: Your building is covered if it has a Gross Floor Area (GFA) of 8,000 square meters or more.
• What happens if you're in this group: The EC will also notify you. You'll then have specific duties related to energy intensity labeling and potential energy audits.

What if you are below these thresholds? Even if your business doesn't meet these specific energy consumption or building size limits, you are still encouraged to adopt energy-efficient practices. Saving energy benefits everyone, regardless of whether it's legally required. Plus, the EC may expand the scope of the Act in the future.

Now, let's get to the specifics of EECA 2024 Compliance: A Simple Checklist for Malaysian Businesses, broken down by group.

 

3. The EECA 2024 Compliance Checklist for Energy Consumers (Industrial/Commercial)

If your factory or large commercial business has been identified as an "Energy Consumer," here's your essential checklist for EECA 2024 Compliance: A Simple Checklist for Malaysian Businesses:

Checklist Item 1: Appoint a Registered Energy Manager (REM)

• What it is: A Registered Energy Manager (REM) is a trained and certified expert who will be in charge of managing your company's energy use. They are officially registered with the Energy Commission (EC).
• Why you need one: The REM is your go-to person for all things energy efficiency. They'll collect data, find ways to save energy, and make sure you follow the rules.
• Types of REMs:
• REM Type 1: For businesses consuming between 21,600 GJ and 50,000 GJ per year. They are experts in electrical energy and basic energy management.
• REM Type 2: For businesses consuming 50,000 GJ or more per year. They have deeper knowledge, including thermal energy systems (like boilers, furnaces) in addition to electrical.
• Your Action:
• Timeline: You must appoint a REM within 3 months of receiving the official notice from the Energy Commission.
• Internal or External: You can either train one of your existing employees to become a REM (if they meet the qualifications) or hire an external, qualified REM. An internal REM can manage up to 8 related energy consumers. An external REM can be appointed for up to 3 years from the date of the EC notice.

Checklist Item 2: Develop and Implement an Energy Management System (EnMS)

• What it is: An Energy Management System (EnMS) is a structured way to manage your company's energy use. Think of it like a system for quality control, but for energy. It involves setting energy goals, tracking progress, and making continuous improvements. The most recognized EnMS is ISO 50001, but the EC provides its own guidelines.
• Why you need one: An EnMS helps you understand where your energy is going, identify inefficiencies, and put a plan in place to fix them. It's about ongoing, smart energy management.
• Your Action:
• Timeline: You must establish and start implementing your EnMS within 12 months of your REM being appointed.
• Role of REM: Your Registered Energy Manager will play a key role in setting up, running, and monitoring this system. They'll help you create an energy policy, set targets, and put action plans into motion.

Checklist Item 3: Conduct Regular Energy Audits

• What it is: An energy audit is a detailed check-up of all your energy-using equipment and processes. It's performed by a Registered Energy Auditor (REA), who is another certified expert different from a REM (though some individuals may hold both certifications). The auditor finds out exactly where you're wasting energy and suggests specific ways to save it.
• Why you need one: The audit provides the hard data and recommendations that will form the basis of your energy-saving efforts and feed into your EnMS.
• Your Action:
• Timeline: You must complete your first energy audit within 12 months of receiving the official notice from the Energy Commission.
• Periodicity: After the first audit, you will likely be required to conduct subsequent audits periodically (e.g., every 5 years, though this timeframe is subject to EC guidelines).
• Report Submission: The audit report prepared by the REA must be submitted to the EC.

Checklist Item 4: Prepare and Submit Annual Energy Efficiency & Conservation (EE&C) Reports

• What it is: This is a yearly report that summarizes your energy consumption, how well your EnMS is working, and what energy-saving steps you've taken.
• Why you need one: It's your way of showing the Energy Commission that you are actively managing your energy and complying with the Act.
• Your Action:
• Timeline: Your REM must prepare and submit this report to the EC within 30 days after completing the first year of their appointment. This will then be an annual requirement.
• Accuracy: The REM is responsible for ensuring all information in the report is accurate and matches your actual energy bills and records.

Checklist Item 5: Implement Energy Saving Measures

• What it is: This involves actually putting into practice the recommendations from your energy audit and the plans from your EnMS. This could mean upgrading to more efficient machinery, fixing leaks, improving insulation, or optimizing how your equipment runs.
• Why you need one: This is where you actually save money and reduce your carbon footprint! The audit and EnMS are tools, but implementation is the action that brings results.
• Your Action:
• Continuous Process: This isn't a one-time thing. Your REM will help you continuously identify and implement new energy-saving measures as part of your ongoing EnMS.
• Timeline: While there's a 5-year cycle for complying with standards after the second audit, your commitment to continuous improvement should start immediately based on your first audit.

 

4. The EECA 2024 Compliance Checklist for Persons in Charge of Buildings

If you own or manage a large office building that falls under the 8,000 sqm GFA threshold, here's your checklist for EECA 2024 Compliance: A Simple Checklist for Malaysian Businesses:

Checklist Item 1: Apply for and Display an Energy Intensity Label (BEI Label)

• What it is: This is a label (called a Building Energy Intensity or BEI label) that shows how energy-efficient your building is, often with a star rating. It's like the energy label you see on home appliances.
• Why you need one: It provides a clear, public way to benchmark your building's energy performance and promotes transparency.
• Your Action:
• Display prominently: Once issued, this label must be displayed in a visible part of the building.
• Annual Renewal: The BEI label needs to be renewed every year.
• Minimum Rating: Your building must maintain a minimum energy efficiency rating (e.g., at least two out of five stars, as per current understanding).

Checklist Item 2: Ensure Compliance with Energy Intensity Performance Standards

• What it is: Beyond just having a label, your building's actual energy performance (how much energy it uses per square meter) must meet certain standards set by the EC.
• Why you need one: This ensures that buildings are not just labeled, but are actually performing efficiently.
• Your Action:
• Monitor Performance: Continuously monitor your building's energy consumption to ensure it meets the required standards.
• If Non-Compliant: If your building fails to meet the minimum energy intensity performance, the EC will require you to conduct an energy audit and prepare an energy improvement plan.

Checklist Item 3: Prepare and Implement an Energy Efficiency Improvement Plan

• What it is: If your building's energy performance is not up to standard, you'll need to create a plan that outlines how you will improve it. This plan will be based on the findings of a mandatory energy audit conducted by a Registered Energy Auditor.
• Why you need one: This plan provides a structured approach to bringing your building's energy performance up to the required levels.
• Your Action:
• Conduct Audit: Engage a Registered Energy Auditor (REA) to perform a detailed energy audit of your building.
• Develop Plan: Based on the audit, create a clear plan for energy efficiency improvements.
• Submit for Approval: This plan must be submitted to the EC for approval.
• Implement: Once approved, you must implement the energy efficiency improvement plan.

 

5. Penalties for Non-Compliance: What You Need to Know

The EECA 2024 is a serious law, and there are real consequences for not complying. The penalties are designed to encourage businesses to take their energy efficiency responsibilities seriously.

Here's a general overview of the potential penalties:

• Fines: Non-compliance with various requirements can result in significant financial penalties, typically ranging from RM20,000 to RM100,000.
• For example, failing to appoint a REM can lead to a fine of up to RM50,000.
• Failure of a REM to perform their duties can lead to a fine of up to RM20,000.
• Not complying with EnMS requirements or failing to submit EE&C reports can also result in fines up to RM50,000.
• Failing to conduct energy audits or comply with audit requirements can also lead to fines up to RM50,000.
• Imprisonment: In some severe cases of violation, individuals responsible could face imprisonment for up to 2 years, or both a fine and imprisonment.
• Other Actions by EC: The Energy Commission also has the power to:
• Inspect facilities and seize items related to violations.
• Issue directives for additional audits or reports.
• Cancel certificates (e.g., BEI labels if standards are not met, or REM/REA registrations for misconduct).

These penalties emphasize that EECA 2024 Compliance: A Simple Checklist for Malaysian Businesses is not optional for those affected.

 

6. Getting Started: Your Action Plan for EECA 2024 Compliance

So, you've read through the checklist. What should your business do right now to ensure EECA 2024 Compliance: A Simple Checklist for Malaysian Businesses is met?

1. Determine if You Are Affected:
• Pull out your last 12 months of energy bills (electricity, natural gas, diesel, etc.) and calculate your total annual energy consumption in Gigajoules (GJ). If it's 21,600 GJ or more, you're an "Energy Consumer."
• For buildings, check your Gross Floor Area (GFA). If it's 8,000 sqm or more, you're a "Person in Charge of a Building."
• Even if you're not sure, it's wise to start gathering this data. The EC will issue notices, but being prepared means you're not scrambling at the last minute.
2. Form an Internal Team:
• Assign a person or a small team to be responsible for EECA compliance. This could be someone from your operations, finance, or sustainability department.
3. Budget for Compliance:
• Factor in the potential costs: salaries or fees for a REM, costs for energy audits (by an REA), and potential investments in energy-efficient upgrades. Remember that many of these costs can be offset by the energy savings you'll achieve.
4. Explore Government Grants and Incentives:
• Malaysia offers programs like the Energy Audit Conditional Grant (EACG 2.0) by SEDA Malaysia, which can help cover a significant portion of your energy audit costs.
• The Green Investment Tax Allowance (GITA) can provide tax benefits for investing in certain green technologies.
• Work with an energy consultant or an ESCO (Energy Service Company) who can guide you through applying for these incentives.
5. Stay Informed:
• Regularly check the websites of the Energy Commission (EC) and SEDA Malaysia for the latest guidelines, regulations, and updates related to EECA 2024. The Act is new, and more detailed guidelines will likely be released over time.
6. Don't Wait for the Last Minute:
• The penalties are significant, and the benefits of energy efficiency (cost savings, sustainability, better reputation) are too good to miss. Start your preparation now to ensure a smooth transition into compliance.

 

7. Beyond Compliance: The Hidden Benefits

While EECA 2024 Compliance: A Simple Checklist for Malaysian Businesses focuses on meeting legal requirements, the true value of the Act extends far beyond avoiding fines. By actively embracing energy efficiency, your business can unlock several hidden benefits:

• Significant Cost Savings: The primary benefit of cutting energy waste is lower utility bills, directly boosting your profitability.
• Enhanced Sustainability & Brand Image: Meeting EECA requirements demonstrates your commitment to environmental responsibility, improving your company's reputation with customers, investors, and employees.
• Improved Operational Efficiency: Identifying energy waste often uncovers operational inefficiencies, leading to smoother processes and longer equipment lifespan.
• Competitive Advantage: Companies that manage energy effectively often gain a cost advantage over less efficient competitors, especially as energy prices fluctuate.
• Access to Green Financing: Financial institutions increasingly favor sustainable businesses, making it easier for energy-efficient companies to access favorable loans and investments.

In summary, the Energy Efficiency and Conservation Act (EECA) 2024 is a landmark piece of legislation in Malaysia, requiring specific actions from businesses that consume significant energy or manage large buildings. Following this EECA 2024 Compliance: A Simple Checklist for Malaysian Businesses is not just about avoiding penalties; it's about making your operations more efficient, sustainable, and financially robust. By proactively appointing a Registered Energy Manager, implementing an Energy Management System, conducting regular audits, and fulfilling reporting obligations, your business can navigate this new landscape successfully and unlock substantial long-term benefits.

Are you unsure if your business meets the EECA 2024 thresholds or need expert guidance on the compliance process? Don't leave it to chance and risk penalties. For a personalized assessment, assistance with REM appointments, energy audits, or EnMS development, WhatsApp or call us today at 0133006284. Let's ensure your business is fully compliant and thriving in Malaysia's new energy landscape!