Energy Savings Opportunity Scheme (ESOS)
What is ESOS?
The Department of Energy and Climate Change (DECC) has recently implemented the UK Energy Saving Opportunity Scheme (ESOS) in response to the EU directive. This came into effect in December 2015 and is designed to lead to greater energy efficiency, cost savings and carbon reduction in the business sector.
ESOS is a mandatory energy assessment scheme for organisations in the UK that meet the qualification criteria. The Environment Agency is the UK scheme administrator.
Organisations that qualify for ESOS must carry out an ESOS assessment every four years. These assessments are audits of the energy used by their buildings, industrial processes and transport to identify cost-effective energy saving measures. Businesses must notify the Environment Agency by a set deadline that they have complied with their ESOS obligations. The deadline for the first compliance period, 5th December 2015, has now passed.
Is your business affected?
All large UK businesses (250+ employees or a turnover of £42m+ with an annual balance sheet of £36.5m) are affected by ESOS regulations and must undertake an energy audit every four years.
The government has predicted that 7,300 UK businesses are affected by ESOS, which covers more than 200,000 buildings, 10,000 industrial plants and accounts for 35% of total UK energy consumption (edie.net).
How to become ESOS compliant?
Businesses are being urged to go beyond compliancy and to take advantage of the real opportunities and savings that are possible with ESOS. Long term, the Carbon Trust estimates that businesses could save up to £1.9bn from 2015 to 2030 through the implementation of ESOS. ESOS compliancy can be achieved in the following ways:
- Gaining ISO 50001 accreditation (Energy Management System) ensures that you are fully ESOS compliant.
- An ISO 14001 (Environmental Management System) certification does not guarantee compliancy; however, evaluating energy usage as an environmental impact provides a good foundation for organisations to become compliant.
- If a business is part of the Green Deal scheme it will have met the requirements of the ESOS scheme. The Green Deal scheme is a government initiative designed to help businesses to employ more green technologies in their properties.
- Using BS EN 16247-1 (Energy audits) will ensure that energy audits undertaken are of a good standard to produce results with progressive actions that can be implemented at a company’s own individual pace, helping them to achieve ESOS compliancy.
Five steps to completing an ESOS assessment
1. Calculate your total energy consumption
This is the energy used by assets held or activities carried out by your organisation or group. This includes the energy consumed by buildings, industrial processes and transport.
2. Identify areas within your business of significant energy consumption
This is the energy used by assets held, or activities carried out, by your organisation that account for at least 90% of your total energy consumption. You will then need to:
a) Find out whether ISO 50001, Display Energy Certificates (DECs) or Green Deal Assessments (GDAs) cover any of your areas of significant energy consumption.
b) Identify whether ESOS compliant energy audits have been, or need to be, carried out for the areas of significant energy consumption not covered by ISO 50001, DECs or GDAs.
As long as 90% of your total energy consumption is covered, you can use a mix of approaches with some of your energy consumption covered by ISO 50001; some by DECs or GDAs and some by ESOS energy audits.
3. Appoint a lead assessor
You need to appoint a lead assessor to carry out, oversee and review your energy audits and overall ESOS assessment. Lead assessors can be employees or external contractors, but must be members of an approved professional body register.
If you want to become a lead assessor, you have to be (or become) a member of an approved professional body register. Individuals can’t apply directly to the Environment Agency to be approved. Professional bodies can submit registers of their members for approval for them to act as ESOS lead assessors.
4. Notify the environment agency
You need to submit your ESOS notification of compliance to the Environment Agency when you have undertaken an ESOS assessment and are compliant with your obligations. The notification deadline was 5th December 2015 for the first cycle and every 4 years afterwards. If you missed the deadline, then submit your notification as soon as possible.
5. Keep records
You need to keep records of how you have complied with ESOS in an evidence pack. There is no set format for this.