Energy Savings Opportunity Scheme (ESOS)

The Energy Saving Opportunity Scheme is a mandatory requirement for all large enterprises in the UK. The scheme requires a survey and audit of energy usage, and reporting of energy data for buildings, transport, and industrial processes over a 12-month period. All surveys have to be undertaken by a qualified Lead Assessor.

We are now in Phase 3 of the scheme.

Who will the scheme affect?

Any business with over 250 employees. An employee is defined as a person employed under contracts of service. Their contracted hours and status, whether full or part time, are irrelevant to their classification as an employee.

If you have less than 250 employees but your annual turnover is more than £44,845,000 and your balance sheet is in excess of £38,566,700 then you will also qualify.

If you do not directly meet these criteria but you are part of a group, then you may still be required to take part in the scheme. If any business within the group qualifies, then every company within that group will also qualify.

When will I need to act?

Now. The deadline for ESOS Phase 3 compliance is 5th June 2024.

Are there exemptions?

No. However, ISO50001 is deemed an equivalent reporting method so would obviate any ESOS submission.

What are the sanctions for non-compliance?

A hefty fine including name and shame. The financial penalty can be up to £50,000 with an additional £500 per day. Unlike with previous ESOS phases where the Environment Agency has been lenient, late submission of Phase 3 compliance will likely receive enforcement action with penalties.

The point of ESOS

ESOS is not meant to tax industry but to help businesses become more energy efficient and energy aware. The overall aim is to reduce consumption and therefore carbon emissions. Your Lead Assessor’s report will identify potential cost saving measures and how to implement them. Taking action on the results of the audit is not compulsory.

ESOS Phase 3

Areas of significant energy consumption have increased to 95%, which means that an increase in auditing will need to take place; this will include data collection, site surveys, report writing, portfolio extrapolation and a sign off presentation to a director. There is also increased pressure on the market as there is half the number of Lead Assessors available to complete the compliance sign-off.