Energy Savings Opportunity Scheme (ESOS)

Understanding The Energy Savings Opportunity Scheme (ESOS)

ESOS is a mandatory energy assessment scheme for organisations in the UK. Energy Savings Opportunity Scheme compliance applies to large UK undertakings and their corporate groups that meet the criteria.

Large organisations are required to assess and report their energy usage every 4 years as well as to find ways to reduce their energy consumption. ESOS has now entered Phase 3 after the successful completion of ESOS Phases 1 & 2; UK businesses have until 5th June 2024 to comply with ESOS Phase 3.

The UK government estimates that the benefit of ESOS compliance to the UK after Phases 1 & 2 is approximately £1.6 billion.

Who must comply with ESOS?

A company must comply with ESOS if their organisation qualifies as a ‘large undertaking’ by 31st December 2022.

A ‘large undertaking’ meets one or more conditions below:

- - It employs 250 or more people.
  - It has an annual turnover over £44m and a balance sheet over £38m.
  - An overseas company with over 250 UK employees.

Companies must participate in ESOS if part of a group including a UK entity meeting the conditions.

Deadlines for ESOS Compliance

Organisations that qualify for ESOS must carry out energy assessments every 4 years. These assessments are audits of the energy used by a company’s buildings, processes, and transport to identify cost-effective energy-saving measures.

- - The deadline for the third compliance period (ESOS Phase 3) is the 5th of June 2024 (Recently extended: see article).
  - The qualification date for the third compliance period is 31st December 2022.
  - The compliance phase runs from the 6th of December 2019 – the 5th of June 2024.

Organisations must notify the Environment Agency by a set deadline that they have complied with their ESOS obligations.

ESOS Assessment

The ESOS assessment must cover all of an organisation’s UK operations over a twelve-month period. It requires participants to do the following:

1. 1. 1. Measure total energy consumption across buildings, transport, and industrial activities.
    2. Conduct energy audits, such as an ESOS-compliant energy audit, Display Energy Certificate, Green Deal Assessment, or a certified ISO 500001 Energy Management System, to identify cost-effective energy efficiency recommendations.
    3. Report compliance to the Environment Agency.

Companies must notify the Environment Agency of compliance before the end of the compliance period. The assessment must be reviewed by a board-level director and approved by a lead assessor.

Why choose McGrady Clarke for your ESOS Assessments?

Our Energy Auditors pinpoint anomalies in energy usage through analysis of site-specific operations and consumption trends. Using industry best practices, our on-site audits identify and quantify energy efficiency measures in line with ESOS and ISO 50001 guidelines. We follow BS EN 16427 and ISO 50002 to deliver our audits, ensuring the highest qualities are maintained.

At McGrady Clarke, we view ESOS as an opportunity to assist our clients in expanding their environmental capabilities and strengthening their green credentials beyond minimum compliance. We offer our clients the opportunity to realise the long-term benefits and cost savings related to energy and carbon reductions.