Plan now for ESOS Phase 4

ESOS Phase 4 largely retains the same reporting framework as Phase 3. Hence, the qualification criteria remains unchanged from Phase 3, and so far only minor updates have been confirmed, mainly relating to increased reporting transparency and the removal of certain compliance routes:

• Display Energy Certificates (DECs) and Green Deal Assessments (GDAs) can no longer be used as compliance routes.
• Organisations that were required to submit an ESOS Phase 3 Action Plan that must include progress updates on their Action Plan commitments in their ESOS Phase 4 submission. If planned actions are not completed, an explanation must be provided.

Businesses who meet the qualification criteria for ESOS Phase 4 employ 250 or more people, and/or have both an annual turnover over £44 million and a balance sheet total over £38 million.

Public sector organisations are generally exempt, but some with mixed funding or non-profit elements may still fall within scope. If your individual entity doesn’t meet these thresholds, you may still be in scope if you are part of a larger corporate group or another entity within the group qualifies.

Failure to comply can result in enforcement action by the Environment Agency, including financial penalties and public disclosure of non-compliance. Meeting the compliance timeline on time helps avoid unnecessary costs and reputational risk.

While ESOS is a legal requirement, it can also help organisations:

• Reduce energy costs
• Identify efficiency improvements with strong ROI
• Lower carbon emissions
• Support wider ESG and Net Zero goals
• Improve operational performance

Organisations will need to confirm whether they meet the below criteria on this date. Furthermore, If an organisation is very close to the threshold for qualification or has recently grown or shrunk, then they may need to look back over several accounting periods to establish if they qualify.

Compliance must be submitted to the Environment Agency via the MESOS portal by the deadline. This should include information on the total energy consumption, and recommendations highlighting estimated energy savings.

We provide full ESOS compliance support, including on-site audits, data analysis and guidance through ESOS Phase 3 Action Plan implementation. Also, our team supports you with the MESOS portal submission process, to guide you in meeting your obligations while identifying opportunities to cut costs and carbon emissions.

Even if your organisation is exempt, energy efficiency measures can still reduce costs, improve environmental performance, and support corporate sustainability goals.

Contact a specialist at McGrady Clarke today to start preparing for compliance ahead of the deadline.