What is ESOS?
The Energy Savings Opportunity Scheme, ESOS, is a mandatory energy assessment scheme for large UK organisations. It requires qualifying organisations to carry out a comprehensive audit of their energy use every four years and identify opportunities for energy savings.
Does ESOS apply to my organisation?
ESOS applies to large UK undertakings, broadly defined as organisations with 250 or more employees, or with an annual turnover exceeding £44 million and a balance sheet total exceeding £38 million. Subsidiary companies and corporate groups may also be included if the group as a whole meets the threshold. Small and medium enterprises are exempt.
What does an ESOS audit cover?
An ESOS audit covers all significant areas of energy consumption within the organisation, buildings, industrial and commercial processes, and transport. The audit must be led by a qualified Lead Energy Assessor and must identify areas of significant energy consumption and opportunities for cost-effective improvement. An energy audit of your buildings is a common starting point and can count as evidence toward ESOS compliance.
What is Phase 3?
ESOS operates in four-year phases. Phase 3 compliance is now required. Organisations that have not yet completed their Phase 3 audit are in breach of the scheme and should act immediately.
What are the penalties?
The Environment Agency can impose civil penalties of up to £50,000 for non-compliance, plus £500 per day for continuing non-compliance. Enforcement notices have been issued to well-known organisations including major retailers and online platforms.
What happens after the audit?
Unlike some compliance schemes, ESOS does not require you to implement the recommendations, only to carry out the audit and notify the Environment Agency. However, the audit typically identifies significant energy saving opportunities, and many organisations use ESOS as the starting point for a broader net zero assessment and reduction programme.