What Are the ESOS Regulations?
ESOS, also known as the Energy Savings Opportunity Scheme, is a mandatory energy assessment that aims to ensure that UK businesses and organisations are energy efficient in compliance with Article 8 of the EU Energy Efficiency Directive. Those who qualify must carry out ESOS assessments once every four years and then inform the Environment Agency as the scheme’s administrator.
As part of these assessments, UK businesses and organisations must audit the energy they use, including the usage of any buildings, transport or industrial processes.
An ESOS assessment involves:
- Calculating your total energy consumption by your assets.
- Identifying your areas of significant energy consumption.
- Appointing a lead assessor who is a member of the approved professional body register. They can be employees or external contractors.
- Notifying the Environmental Agency by submitting a notification of compliance.
- Keeping adequate records of ESOS compliance.
Why Are They Important?
The ESOS assessment is vital because it allows industrial organisations to measure their energy usage and accurately identify ways to save money by highlighting and targeting energy inefficiencies. In short, it supports and empowers businesses to optimise their energy efficiency, becoming more cost-effective whilst simultaneously reducing the Nation’s carbon footprint and helping to reach the UK’s target of Net Zero by 2050.
Who Has to Comply With ESOS?
According to the UK Government website, ‘large undertakings’ in the UK must comply if they have the following:
- 250 or more employees
- A turnover that exceeds €50 million (£44,845,000) and an annual balance sheet in excess of €43 million (£38,566,700)
A large undertaking covers corporate bodies, partnerships and non-profits; this includes UK-based offices of an overseas company. The scheme largely excludes the public sector.
Are There Any Penalties?
Yes, as the scheme moves into its third phase, the Environmental Agency is cracking down on enforcing penalties for each breach of ESOS regulations. Before sending a notice, the EA will conduct a breach assessment. Breaches that exact a penalty include the following:
- Failure to notify the Environmental Agency that it has complied with ESOS: An initial penalty of up to £5,000 followed by a daily penalty of up to £500 for each day the organisation remains in breach. The EA will enforce the penalty regardless of whether the organisation has undertaken an energy audit, as notification is a crucial requirement.
- Failure to maintain adequate records: An initial penalty of up to £5,000 in addition to a ‘sum representing the cost to the compliance body of confirming that the responsible undertaking has complied with the scheme’. The organisation must meet the Environmental Agency’s requirements to remedy the breach.
- Failure to undertake an energy audit: An initial penalty of up to £5,000, plus a daily penalty of up to £500 for each working day the organisation remains in breach. In addition, the organisation or business must conduct and complete the ESOS assessment to remedy the breach.
- Failure to comply with a served notice: An initial penalty of up to £5,000, in addition to a daily penalty of up to £500 for each working day the organisation remains in breach.
- Providing a false or misleading statement: A penalty of up to £50,000.
You can find further detail in the Environment Agencies Annex 2 on civil penalties under section D.
When Are the Different Phases?
The implementation of ESOS has been carried out in four-year phases beginning in 2014. The Environmental Agency makes changes in each phase to increase efficiency and ensure compliance. You can find the changes made in Phase 3 in the UK Government’s Response to their ESOS consultation.
The ESOS Phase 1 deadline passed on the 5th of December, 2015.
The ESOS Phase 2 deadline passed on 5th December 2019.
The ESOS Phase 3 deadline is due on 5th December 2023. If you have met the definition of a ‘large undertaking’ by 31st December 2022, your business must comply with ESOS Phase 3.
The ESOS Phase 4 deadline is due on 5th December 2027.
What is an ESOS Assessor?
An ESOS Assessor is an employee or approved contractor who is a member of the UK Government’s professional body register. They oversee your energy audits and ESOS assessment and ensure you comply with ESOS regulations.
Explore Our EPC Services
EPC For You have a dedicated team of approved assessors ready and available to help you carry out your energy audit in compliance with ESOS regulations. Our assessors can visit your site to conduct surveys and gather data ready to be signed off by an ESOS lead assessor, which we will organise on your behalf. With our expertise, we guarantee that not only will you be government compliant, but we will save you time, money and energy by ensuring you meet every requirement of the ESOS scheme.
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