ESOS: Phase 2 Compliance

The Energy Savings Opportunity Scheme (ESOS) was created to implement Article 8 of the EU Energy Efficiency Directive in the UK. ESOS requires organisations who qualify to conduct a mandatory energy assessment every 4 years - we are now in Phase 2 of the scheme.

The assessments are to include energy used by:
- Buildings
- Industrial processes
- Transport

From the energy assessment, savings opportunities are identified. It is not mandatory that organisations implement any of the identified opportunities, this is voluntary and an area which has been heavily criticised, as for many organisations it becomes a tick box exercise. As a result, significant energy saving opportunities are missed. For example, the Carbon Trust reported that on average a business can reduce its annual energy costs by 20% through improving on energy efficiency.

Timeline for Phase 2

Qualification Criteria
To understand if your organisation qualifies under ESOS, you should assess your organisation against the following criteria on the qualification date. If you meet one or more of the following criteria, you are required to comply:
- 250 or more employees
- Have an annual turnover in excess of €50 million and a balance sheet total in excess of €43 million

How to comply with ESOS
1. Measure total energy consumption
Total energy consumption across buildings, industrial processes and transport must be measured 

2. Identify energy efficiency opportunities
There are various routes to compliance, if at least 90% of an organisations total energy consumption is covered by any of the following, they are exempt from conducting an audit:
- A Certified ISO 50001 Energy Management System (EMS) 
The EMS must have been certified during the compliance period and must also be valid on the compliance date.
- A Display Energy Certificate (DEC) 
It must have been issued in the compliance period and be valid on the compliance date.
- A Non-Domestic Green Deal Assessment
It must have been conducted in the compliance period and be valid on the compliance date.

If your organisation is not covered by any of the above, you must appoint an ESOS Lead Assessor to conduct an audit as your route to compliance.

3. Notify scheme administrator of compliance
Notification must be made to the scheme administrator on or before the compliance date for each phase, for phase 2 this is 5th December 2019. In Northern Ireland the scheme administrator is the Northern Ireland Environment Agency (NIEA).

The Environment Agency (EA) sent out a Newsletter in 2017, encouraging companies to start preparing for Phase 2. If you act now and start planning, this will ensure sufficient time to iron out any issues such as missing/inaccurate data or lack of available ESOS assessors close to the deadline. It will also enable your organisation to fully understand the benefits of the scheme.

It is also likely the administrative authorities will be less lenient in this phase, as the introductory phase is now behind us and the guidelines are clear. Hefty fines can be issued to those companies who do not comply, these fines range up to £50,000 depending on the area of non-compliance. It is therefore within your organisation’s best interest to ensure you are fully compliant.  

For further information on how to comply with ESOS and how we can assist you, please contact us on 028 9072 7760.