What is the Energy Savings Opportunity Scheme (ESOS)?

The Energy Savings Opportunity Scheme (ESOS) was introduced by the UK Government to promote energy efficiency within real estate assets or buildings. The scheme is designed to ensure ‘large’ organisations are regularly assessing their energy use. ESOS compliance must be achieved every four years, with Phase 3 covering the period from 6 December 2019 to 5 December 2023. The final deadline for this phase is now 6 August 2024, however registration onto the IT system needs to take place by  5 June 2024. To achieve compliance with ESOS Phase 3, organisations must assess their energy usage across all their operations, including buildings, transportation, and industrial processes.

Organisations can achieve compliance by:

• Conducting energy audits on a regular basis
• ISO 50001 certification
• Display energy certificates
• Green deal assessments

How do you achieve Phase 3 compliance?

The first step is appointing a qualified Lead ESOS Assessor. The Lead Assessor plays an important role in the assessment process, deciding on the best route to take to achieve compliance and then overseeing the assessment process ensuring it is in accordance with regulation.

Changes in ESOS Phase 3:

ESOS Phase 3 has introduced several key enhancements. These changes are aimed to improve the effectiveness of the scheme in promoting energy efficiency and reducing carbon emissions. Some of the key changes and enhancements include:

1. Areas of significant energy consumption: In the first and second compliance period, ESOS participants were able to exclude up to 10% of their energy supplies and report on 90%. In the third compliance period this has been changed to an up to 5% exclusion and at least 95% of total energy consumption must be included.
2. Energy data intensity ratios: An energy intensity ratio must be calculated for building, transport, and process energy use. By analysing these ratios, participants can identify areas of high energy consumption relative to key performance indicators.
3. Energy consumption data: Participants must submit details of their energy data as part of the ESOS submission.
4. ESOS action plan: Set out an action plan for future energy saving measures. This should include what you intend to do to reduce energy consumption and when you intend to do it. Similar to the ESOS report, the action plan must be signed off by a board level director and submitted by the action plan deadline of December 2024.
5. Annual progress updates: A year on from submitting the action plan, participants must submit annual progress updates against the action plan.
6. Enhanced enforcement measures: To ensure greater accountability and compliance, ESOS Phase 3 introduces strengthened enforcement measures and penalties for non-compliance. Regulatory authorities have ramped up monitoring efforts and are empowered to impose significant fines and sanctions.

With the changes brought in for Phases 3, the ESOS scheme can potentially play a bigger role in decarbonising the built environment and meeting the UK’s climate goals, including the commitment to achieve net zero greenhouse gas emissions by 2050.  

Further information

Contact Harry Green or Osman Rashid

Energy Saving Opportunity Scheme: Phase 2 Compliance