Will your business be affected by the Energy Savings Opportunity Scheme (ESOS)? - Maxwell Grant, Reduce Business Costs | Procurement Specialists, Salisbury
Maximising profits by minimising costs 01722 712943 Request a callback Enquiry
July 10, 2014

Will your business be affected by the Energy Savings Opportunity Scheme (ESOS)?

Will your business be affected by the Energy Savings Opportunity Scheme (ESOS)?  If your business has 250 or more employees or has less than 250 employees but has an annual turnover exceeding €50m AND a balance sheet exceeding €43m, then you are likely to be in scope of ESOS.

DECC estimates that ESOS could realise £1.6bn net present value of benefits to the UK, with the vast majority of these being directly felt by businesses in the form of reduced energy bills.  This benefit would be realised if participants in ESOS reduced their energy consumption by an average of 0.7%.  This would lead to energy savings of around 3TWh per year – enough energy to power nearly 160,000 households for a year.

A brief overview of ESOS can be found below.  Further information can be found at https://www.gov.uk/government/consultations/energy-savings-opportunity-scheme

What do you have to do to comply with ESOS?

  1. Measure your total energy consumption:  you must measure your total energy consumption across your buildings, transport and industrial activities
  2. Conduct energy audits to identify cost-effective energy efficiency recommendations:  you must ensure that at least 90% of your total energy consumption is subject to an ESOS compliant energy audit, a Display Energy Certificate, a Green Deal Assessment or a certified ISO 50001 Energy Management System during each phase of the scheme.
  3. Report Compliance to the Environment Agency: by December 2015, you must notify the Environment Agency (as the scheme administrator) that you have complied with this scheme.  Prior to notifying the Environment Agency, you must ensure that your ESOS Assessment has been reviewed by a Board-level Director and approved by a Lead Assessor.

Do I have to implement the changes identified?
There is no requirement to implement the changes however they will only achieve the financial benefits that arise from avoiding energy waste if they do implement the cost-effective recommendations.

What if I am a SME or public body?
Although SMEs or public sector bodies are not required to participate in ESOS, they could still benefit from voluntarily meeting ESOS requirements.

I already have an ISO 50001 Energy Management System
If you already have an ISO 50001 Energy Management System that has been certified and covers all of your energy use, this should be sufficient to constitute an ESOS Assessment.  However, you will still need to notify the Environment Agency of your compliance.

What happens if the ISO 50001 only covers part of my business?
If you have for example four areas of significant energy use that accounted for 90% of your total energy consumption and an ISO 50001 only covered three of these four areas, then you would need to choose another route to address the fourth area of significant energy use.

What type of energy saving opportunities will be recommended by ESOS Energy Audits?
ESOS Energy Audits are required to include recommendations for cost-effective energy efficiency improvements, where opportunities for such improvement exist.  Recommendations should directly save energy or lead to an indirect energy saving through improved energy management.  These might include:

  • installing smart meters and improved energy monitoring tools
  • improvements to service and maintenance strategy to ensure vehicles or machinery are operating efficiently
  • replacing enterprise travel with video-conferencing
  • capital investment projects
  • behaviour change projects

How will an ESOS Energy Audit help to reduce energy usage?
By examining your energy patterns to identify minimum usage levels, maximum usage levels and fluctuations will assist in identifying any priority areas for energy efficiency action.

You may find that energy use is affected by behaviour or processes in your organisation.  In identifying energy saving measures, you first need to understand the drivers of energy consumption.  Therefore, you should engage with energy consumers across your organisation to understand where they think savings could be made.

Is there any financial support for implementing energy saving measures?
The implementation of energy saving measures will be case and organisation specific.  However, there are many sources of information and financial support available to organisations looking to implement energy saving measures including:

Enhanced Capital Allowances (ECA) – https://www.gov.uk/government/policies/reducing-demand-for-energy-from-industry-businesses-and-the-public-sector–2/supporting-pages/enhanced-capital-allowances-ecas

Quality Assurance for Combined Heat and Power – https://www.chpqa.decc.gov.uk

What happens if I don’t comply with the ESOS requirements?
The Scheme Compliance bodies will have the authority to apply civil penalties against an organisation/group found to be required to participate in ESOS and found to be non-compliant with its requirements/

Where can I find a list of approved lead assessors?
The Government will provide a list of approved lead assessors by the end of July 2014, which will be found at:  https://www.gov.uk/energy-savings-opportunity-scheme-esos

More News