Overview
Introduced: 2014
Effective from: Ongoing
Region(s): United Kingdom
About
The Energy Savings Opportunity Scheme (ESOS) is a mandatory energy assessment scheme for large UK organizations. It requires qualifying businesses to carry out energy audits of their buildings, industrial processes, and transportation to identify cost-effective energy-saving measures. ESOS aims to help organizations reduce energy consumption, cut costs, and lower carbon emissions, supporting the UK’s commitment to net-zero emissions.
Criteria for compliance
Entities covered
- UK-based large undertakings meeting one or both of the following criteria:
- Employs 250 or more people
- Has an annual turnover exceeding £44 million and an annual balance sheet total exceeding £38 million
- Corporate groups qualify if at least one UK group member meets the criteria for a large undertaking
Compliance timelines
ESOS operates on four-year compliance cycles:
- Phase 3 compliance deadline: 5 June 2024
- Phase 4 qualification date: 31 December 2026
Routes to compliance
Participants can comply by:
- Conducting energy audits
- Gaining ISO 50001 certification
- Using Display Energy Certificates (DECs) or Green Deal Assessments
- Organizations using ISO 50001 to cover 100% of their energy use are exempt from the need for a full ESOS audit
Disclosure requirements
- Organizations must calculate their total energy consumption for buildings, transport, and processes.
- They must identify areas of significant energy consumption and ensure energy audits cover at least 95% of total energy use.
- Energy audits must assess energy use over a 12-month period and provide recommendations for improvements.
Third-party auditing
A certified ESOS Lead Assessor must oversee the energy audits. The lead assessor’s findings, along with energy-saving opportunities, must be presented to the board and signed off by at least one company director before submission to the Environment Agency.
Penalties for non-compliance
Failure to comply with ESOS regulations can result in financial penalties ranging from £5,000 to £50,000. Organizations in breach may also be publicly named, leading to reputational damage.
