Energy Savings Opportunity Scheme (ESOS)
Friday, 5 September 2014
We think it will be useful for your members who may be affected by ESOS to know about it now. There are actions they can already start to better understand their energy use, identify possible savings, and help ensure they can meet the first compliance deadline of 5 December 2015.
The suggested key messages to convey to your members at this stage are:
• The need to determine whether they are likely to be a large undertaking covered by the scheme; and if so
• The need to start (if they aren't already) collecting data on all energy used in buildings, installations and transport which are the responsibility of UK-registered organisations in their corporate group.
Energy Savings Opportunity Scheme (ESOS)
Aim of ESOS
ESOS is a new UK scheme to encourage large organisations to save energy and money. It does this by requiring that organisations undertake regular assessments to identify cost-effective energy saving measures on supplies to buildings, industrial processes and transport. ESOS is implemented by the Energy Savings Opportunity Scheme Regulations 2014 (1).
Who ESOS applies to
Organisations must take part in ESOS if they, or at least one of their UK group members, are a 'large undertaking'.
A 'large undertaking' is an organisation engaged in a trade or business which:
• employs at least 250 persons; or
• has an annual turnover above €50 million (approximately £42.5 million) and an annual balance sheet above €43 million (approximately £36.5 million).
ESOS does not apply to the public sector or organisations subject to an insolvency procedure.
ESOS key dates
ESOS works on the basis of 'compliance periods' as shown in the table. An organisation is included in the first compliance period if it meets the definition of a large undertaking on the 'qualification date', 31 December 2014. It will need to confirm its compliance for that period by 5 December 2015.
Participation is re-assessed for the second and subsequent compliance periods every four years.
Compliance period Qualification date Compliance deadline
First period: 6 Dec 2011 – 5 Dec 2015 31 Dec 2014 5 Dec 2015
Second period 6 Dec 2015 – Dec 2019 31 Dec 2018 5 Dec 2019
Subsequent periods: every following four-years 31 Dec 2022, 2026, etc. 5 Dec 2023, 2027, etc.
Summary of requirements
Organisations that are fully covered by the ISO 50001 energy management standard will not need to complete any additional assessments or audits for the purposes of ESOS. They will just need to notify the Environment Agency that they comply with ESOS by this route.
Other organisations covered by ESOS that are not fully certified to ISO 50001 will need to conduct an ESOS assessment. This will include:
• measuring their total energy consumption
• identifying their areas of significant energy consumption (at least 90% of the total)
• selecting a route to compliance in respect of each area of significant energy consumption and undertaking the activity to comply via this route - these include ESOS-compliant energy audits, certified ISO 50001 coverage, a Green Deal Assessment or a Display Energy Certificate
• appointing a 'lead assessor' to undertake, oversee or review their audits and overall assessment.
How to notify compliance
When organisations have done their assessments they will need to notify the Environment Agency. There is no administrative fee for this. Notification will use a simple, survey-based tool, which will be accessed from the ESOS webpage https://www.gov.uk/energy-savings-opportunity-scheme-esos.
ESOS-compliant audits
Where audits are required they can take place any time during a compliance period, so organisations who know they will qualify for ESOS in each period can plan a rolling audit programme. Audits already carried out before ESOS was introduced can contribute to its implementation as long as they meet the scheme's requirements. An ESOS-compliant energy audit is one that:
1. is based on 12 months’ verifiable data for a continuous period, beginning no earlier than 6 December 2010 for the first compliance period and no more than 24 months before the start of the audit (the data also may not have been used for an energy audit in a previous compliance period)
2. analyses the organisation’s energy consumption and energy efficiency
3. identifies practicable ways to improve their energy efficiency
4. recommends cost-effective energy saving opportunities
5. identifies the estimated costs and benefits of the energy saving opportunities recommended.
It will be for each organisation to determine what it wants to do on the basis of the assessment. ESOS is intended to identify cost-effective energy saving opportunities which will be in organisations' own interests to apply. There is no regulatory requirement to implement the recommended measures.
ESOS lead assessors
Organisations that are not fully covered by ISO 50001 will need a lead assessor to undertake, oversee or sign-off their ESOS assessment.
Lead assessors can be employees of the organisation or external contractors, as long as they are on an approved register.
Professional bodies can apply to have a register of energy experts approved to act as ESOS lead assessors for any organisation. The application process for professional bodies can be found here https://www.gov.uk/energy-savings-opportunity-scheme-esos. We expect the first approved registers to be published September 2014; these will be referenced on our webpage when available.
Responsible authorities
ESOS has been developed by the Department of Energy and Climate Change (DECC) and is administered by the Environment Agency for the whole of the UK. Compliance functions are divided among the Environment Agency, Natural Resources Wales, the Northern Ireland Environment Agency and the Scottish Environment Protection Agency, with DECC responsible for offshore compliance.
Further Information
If you need additional information please visit our webpage https://www.gov.uk/energy-savings-opportunity-scheme-esos and access the ESOS guidance.
If you can't find the information you need on our webpage or in the guidance you can contact the Environment Agency as the UK scheme administrator at [email protected], regardless of whether your business is in England, Scotland, Wales or Northern Ireland.
For all offshore related queries please contact DECC's Offshore Oil & Gas Environment and Decommissioning Team at [email protected].
August 2014
(1) The Energy Savings Opportunity Scheme Regulations 2014, SI 2014 No. 1643, in force from 17 July 2014
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