What is ESOS Phase 3?
The Energy Savings Opportunity Scheme (ESOS) was introduced to incentivise large UK based organisations to implement energy savings measures. The scheme requires companies to carry out audits every 4 years on the energy usage of their buildings, processes and transport accompanied by cost-effective recommendations to help businesses reduce energy demand and improve energy efficiency.
We are currently in Phase 3 of the ESOS scheme, with audits required to be completed and reported to the Environment Agency by 5 December 2023. The long-awaited outcome of the ESOS consultation was published in July 2022 and has brought some changes into Phase 3 that organisations will need to comply with, including the announcement of a Phase 4.
To ensure you meet the Phase 3 compliance deadline, we recommend starting the site sample building audit now. Our team of CIBSE Accredited Low Carbon Assessors, are fully up to date and knowledgeable on the changes to the scheme and can help you make the most of the ESOS energy scheme.
Who needs to comply with ESOS?
Companies need to comply if they are:
- Registered or based in the UK or a UK establishment
- Employ 250 people or more or
- Have an annual turnover greater than £44m, and an annual balance sheet greater than £38m
SMEs and public-sector bodies are generally exempt from the ESOS scheme. It is expected that with the introduction of Phase 4 to the ESOS scheme, the Government will change the ESOS balance sheet and turnover thresholds to align with SECR, requiring more organisations to report on their ESOS.
How TEAM can help you comply with ESOS Phase 3
Throughout your review we will help you collate data for your building, transport, and process energy use, analysing the data and reviewing your portfolio.
We will carry out your building’s energy surveys, produce the ESOS survey reports and ensure you can maximise the benefits of the scheme through conducting the ESOS review, verification and sign off. Our team of lead assessors will include any necessary changes to your audit and report introduced to the scheme by the Environment Agency once the outcome of the consultation is published.
The UK Government published the ESOS Phase 3 consultation outcome in July 2022. Some of the key additions to Phase 3 for organisations to be aware of include:
- Introduction of standardised reporting to improve the audit quality. Assessors will be required to use a new template that will be designed with stakeholders and made available in time for participants to make the necessary changes to reporting.
- With this, proposals for a standardised ESOS recommendations template will also be taken forward.
- Where available, an analysis of half-hourly energy data to be included in reporting.
- ESOS reports will need to include an overall energy intensity metric within the overview section of the report in terms of kWh/m2 for buildings, kWh/unit output for industry and kWh/miles travelled for transport.
- The requirement to set a target or action plan to be submitted after Phase 3, which organisations will be required to report on during Phase 4.
BEIS has said they will delay the changes that will significantly impact the number of site visits needed to be carried out, but in the interest of ensuring parity across participants, they are implementing changes that ‘may require some additional site visits…or alter the requirements for the ESOS report…or information reported to the Environment Agency’. It is most likely that when the details of this are published, for anyone who has already completed their Phase 3 audits, changes will need to be made to the reports to include additional information and to standardise the report format.
The compliance phase for Phase 3 is from 6 December 2019 to 5 December 2023. Despite the ongoing consultation it is never too early to get started with your ESOS compliance. Many organisations are completing their site sample building audits now ahead of the data audit phase of the scheme to ensure they can meet the compliance deadline.
If a qualifying organisation misses the deadline, they can expect to receive a basic fine of £50,000, plus an additional fine of £800 per day up to a maximum of 80 days.
For more information, you can speak to a member of the team on 01908 690018 or contact us online and we will get in touch with a quote.
Speak to an ESOS consultant
Call 01908 690018 and find out how our consultants can help you make the most of the ESOS energy scheme