INGENIEUR
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Expand the coverage of measurement and
verification specifications to cover a wider
range of project types. Through effective
means, the measurement and verification
specifications can meet the actual
requirements of various types of contracts.
Develop reliable tools to measure energy
savings and establish effective baselines
to facilitate deep energy savings.
Increase the financing of third-party
financial investment institutions to the
owners, develop the national public credit
rating system as well as the required
standards and guidelines and allow an
independent auditing firm to determine the
accuracy of the financial report.
Establish diverse and innovative financing
channels to encourage greater energy
savings; establish project bundling
mechanisms to reduce transaction costs
and scale.
Continue to encourage financial innovation
to open the civilian and commercial
construction market and expand low-cost
project integration.
Establish an EPC model in the public sector:
adjust the Government procurement policy
and energy cost budget system according to
the needs of EPC to drive public investment
in the energy efficiency department.
Allow the public sector to retain its
original energy budget throughout the
implementation of the project to reimburse
energy-saving project contracts.
Ensure that the procurement policy is
beneficial to EPC projects, for example,
explicitly allowing EPC models and allowing
two-stage bidding. i.e. allowing ESCOs to
conduct investment-level audits.
Encourage to adopt procurement policies
that are beneficial to EPC. Due to the high
initial transaction costs in small-scale
markets, it is encouraged to conduct
consultations with energy-saving service
companies to facilitate these small-scale
markets to attract contractual energy
management projects
Work with the Energy Performance Contract
Demonstration Project Working Group to
establish direction, especially to determine
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whether project selection is focused on
the construction sector (public buildings,
commercial buildings, etc.) or the industrial
sector.
Use the working group to advance the
co-operation and consensus between
the two parties, including issues like
the establishment of feasible contracts,
financing, measurement and verification,
and strategic issues such as policy
recommendations.
It is recommended that demonstration projects
include technology integration solutions to achieve
deep energy savings. The following methods
should be adopted in parallel: energy-saving and
quantity-guaranteed applications, more effective
support for measurement and verification of
technology integration, and third-party financing
models.
In another case, customers did not trust the
technology at first, so the two parties negotiated
the EPC model, and the energy-saving company
bore the technological risks and costs of capital
investment. However, after the project was in
operation for a period and the energy-saving
benefits gradually materialised, the company
found that the cost of signing the energy-saving
contract was twice that of the buyout equipment,
so they regretted it when they paid. Such examples
are everywhere in the energy-saving management
industry. Later, based on energy-saving benefit-
sharing, a variety of business models were derived
from the industry.
In addition, financial difficulties are also a
major obstacle in this industry. At the beginning
of the project, the energy-saving company needs
to provide a package of services such as start-up
funds, equipment, installation and commissioning,
maintenance and repair, etc., only to recover the
proceeds later. Therefore, the initial start-up
capital is critical to the business. However, energy-
saving enterprises are mostly in their early stages.
High risks and lack of guarantees make it difficult
to obtain bank loans. Under the circumstances,
contract energy management is still in its infancy
in Malaysia. Small companies are scattered in
various places, “each is in power”, and there is
no company that has occupied enough market
share. From this point of view, the domestic