Net Zero Consultants - implementation

Is your business ready for ESOS Phase 3?

What is ESOS Phase 3?

ESOS stands for the Energy Savings Opportunity Scheme (ESOS) and 2023 marks the deadline of the third phase of the regulation, which takes place every four years.

The ESOS scheme assesses energy use in a business’s premises, industrial processes, and transportation method. This review process allows the UK government to understand how much energy is being used by business, as well as providing opportunities to business owners to identify cost-effective energy saving measures.

ESOS is a mandatory energy assessment scheme for specific organisations based in the UK. Not all businesses need to undertake the assessment, but those with either of the following criteria must do so before the deadline date of the 5th December 2023.

  • Businesses who have 250 or more employees based in the UK
  • Businesses with an annual turnover in excess of £44 million and an annual balance sheet total in excess of £38 million

It is estimated that the businesses who meet the above criteria are just under 1% of the registered businesses in the UK, meaning the UK’s 35,600 medium-sized businesses and 5.82 million small businesses will not have to undertake ESOS Phase 3.

What does the ESOS process include?

We’ve outlined 4 key stages which your business should consider during the ESOS assessment:

Appoint a Lead Assessor

The first thing you’ll need to do is confirm your qualified lead assessor, who is typically responsible for carrying out the energy audit and submitting the relevant paperwork (however you don’t need to be a lead assessor to carry out the energy audits). Lead assessors include those with relevant qualifications from one of the 11 organisations, which include IEMA, the Energy Institute and Quidos.

Lead Assessors can be internal employees or external consultants. If you don’t have anyone inhouse with the qualification or time to undertake ESOS, Groundwork can help.

Calculate Energy Consumption

Your Lead Assessor collates your total energy consumption and will determine what audits are required for ESOS; these audits could be anything from reviewing the energy use of machinery, lighting, or fleet.

From here, the Lead Assessor will undertake the agreed audits using information from the past 12-months.

Please note that audits are not the only route to ESOS compliance. If you are an ISO50001 accredited business you simply need to notify the Environment Agency that you’re already compliant. In addition, if you have Display Energy Certificates (DECs) and Green Deal Assessments (GDAs) these can be utilized.

Produce Energy Report

The Lead Assessor will then produce a report which summarises the total energy consumption, the energy data and audit outcomes.

This report should be peer reviewed and approved by the board of directors.

Submit Report

Finally, you’ll need to register your reports and evidence, which should include how you calculated your findings, with the Environment Agency on their web portal before the deadline of 5th December 2023.

Why is ESOS important?

National statistics from BEIS identified that in 2020, businesses accounted for 18% of all UK greenhouse gas emissions. Suggesting that action from business is needed in order to meet the UK’s 2050 net zero target. 

In addition to the fact the 2020 ESOS Post Implementation Review states that “businesses are unlikely to carry out an energy audit unless mandated”, the ESOS process is essential to changing the mindset of business owners, especially as 37% of organisations who comply with ESOS have previously reported net cost savings as a direct result of the review process.

How can Groundwork’s Sustainability Consultants help with ESOS?

Several of Groundwork’s Sustainability Consultants are qualified as ESOS Lead Assessors, so if are looking for someone to support you from start to finish, we can help.

In addition, our team are available to support your audit process, surveying sites or crunching your numbers remotely.

Finally, once you have collected the energy data, we would happily work with you to identify any cost-effective energy saving measures, undertake cost-benefit analysis and decide which actions you want to take forward on your journey to sustainability.