• Lee Calver
  • 19 August 2014

Does ESOS make any sense to you yet?

Are you still struggling to understand the Energy Savings Opportunity Scheme (ESOS) and scratching your head as to whether your organisation should be doing anything in regards to this new regulation?

ESOS is the UK Government’s response to implementing Article 8 of the EU Energy Efficiency Directive, which mandates energy assessments for large organisations. ESOS will affect thousands of organisations and as a result, it is crucial you keep on top of the changes and remain fully aware of what is required of you.

Brief outline of who it applies to and what you need to do

ESOS will apply to all organisations with 250+ employees, or with an annual turnover and balance sheet of €50m and €43m respectively. Any business that qualifies for the scheme must identify and audit their significant energy consumption and submit a formal notification to the Environment Agency. It is important to remember that penalties will be issued for non-compliance and firms could end up with fines of up to £50,000, so it is vital that you are in a position to understand precisely what you need to do.

New guidance

Recently, the Energy Institute has published a free guide to help organisations understand ESOS and realise what actions they must take.

The comprehensive guide, which can be found here, outlines the main routes to compliance and explains the data collection and reporting process.

Looking at the positives of implementing energy efficiency, the Energy Institute states that it is a win-win combination for organisations as it saves both energy and money, while contributing to lowering carbon emissions.

It is anticipated that ESOS will promote the benefits of energy efficiency in the minds of senior management and kick-start a step change in the implementation of energy efficient measures in business.

Following the release of its guide, Skills and Capability Director at the Energy Institute, Sarah Beacock, said:

“As the leading professional membership body for the energy sector, the EI’s role is to keep energy professionals up-to-date on new developments, particularly in energy policy. EI members have contributed to the development of ESOS both through the policy consultation process and directly via the DECC’s Expert Advisory Panel.”

She continued:

“The real value of an ESOS audit to UK business lies in the implementation of the identified energy saving measures. To do that, they will need to call upon experts with a broad range of skills, knowledge and experience that focus on delivering savings to clients.”

Tips for going forward

Independent energy consultancy, Utilyx, has advised businesses not to panic and rush to complete audits, explaining that they may have already done a lot of the work required for ESOS through voluntary initiatives or to comply with other existing regulation.

Head of Consulting and Strategy at Utilyx, Caroline Pitt, said:

“Whilst businesses can feel overwhelmed by regulation and red tape, energy managers must not view this as yet another burden. “ESOS is a chance to raise the case for saving energy up the corporate agenda. By building on the best practice that a business already employs and going beyond the minimum requirements - actually implementing energy savings, not just identifying them - organisations could make significant savings on their energy bills and reduce their carbon emissions.”

Offering his tips for organisations currently worried about ESOS or starting to look at ESOS, Workplace Law’s Environmental Consultant, Matt Watkins, said:

“Organisations covered by ESOS need to approach compliance in a logical and structured way. I would suggest taking the following steps:

  • A first step should be to carry out a gap analysis to determine what further actions are required to comply with the regulations.
  • Remember to include transport energy use.
  • Find and appoint a registered ESOS Lead Assessor who is on a register of energy professionals approved by the Environment Agency.
  • Agree a sign-off route as energy use reduction recommendations must be seen and considered by top management.
  • Put a plan in place to ensure that all work is complete by the December 2015 deadline and avoid the stress of rushing to submit in time.
  • Realise the opportunity of participating as a way to get great energy savings ideas presented to board level in your organisation.”

Workplace Law’s next Facilities Management Legal Update, taking place on Thursday 16 October 2014, will look in further detail at ESOS and explain everything you need to know. Click here to book your place.