Everything you need to know about ESOS reporting
ESOS is a government scheme designed to promote energy saving and improve the efficiency of large UK businesses. Submitting ESOS reports is an obligation for certain UK businesses. Depending on the size of your business, you could be required to regularly audit almost all your operations for energy usage.
Find out if you qualify for ESOS, how to comply with regulations and pass an audit, as well as the benefits of the scheme.
What is ESOS reporting?
ESOS (Energy Savings Opportunity Scheme) is a mandatory energy assessment scheme in the UK, administrated by The Environment Agency. It automatically applies to large businesses i.e., those that employ more than 250 staff or have an annual turnover of over €50 million. It requires the company undertake energy audits every four years and identify energy-saving opportunities.
ESOS regulations were implemented in 2014 as part of the EU Energy Efficiency Directive, which aims to improve energy efficiency and reduce greenhouse gas emissions. As such, an ESOS assessment must include an analysis of the business’s energy consumption across buildings, transportation, and industrial/manufacturing processes. The report should account for at least 90% of the business’s total energy consumption.
Businesses that aren’t compliant with ESOS will be publicly disclosed and could face fines north of £50,000. Public sector organisations typically don’t have to comply with ESOS. See the official guidance.
Benefits of ESOS
- Cost savings: ESOS helps companies identify and implement energy-saving measures, which can lead to significant cost reductions in the long run. For example, efforts to reduce factory waste gases could result in certain processes becoming more efficient. This would lead to a saving on energy costs. According to a Science Direct study, upgrading windows, flooring insulation and heating systems are the most cost-effective energy efficiency measures.
- Environmental impact: By reducing energy consumption, businesses can lower their carbon footprint and contribute to a more sustainable future. The ESOS scheme helps make businesses aware of how they can become more efficient, while also incentivising them to implement environmentally friendly measures. For instance, a business might have considered how to improve efficiency in their production processes but not in their transport activities.
– Fact: Between 2013 and 2021, UK households have made provisional estimated lifetime carbon savings of 59 mega tons of CO2. This was a direct result of energy efficiency initiatives, such as installing cavity wall insulation.
- Employee wellbeing: Of the multiple benefits of energy efficiency outlined by The Energy Saving Trust, one is the improvement of individual health. Measures that improve airflow and allow more natural light in buildings for example, can help boost people’s mood too. For businesses, this can increase employee retention and productivity levels.
- Compliance: ESOS ensures that companies comply with the regulatory requirements and avoid penalties for non-compliance. Proof of ESOS compliance is also a way for businesses to demonstrate their commitment towards environmentally sustainable practices. Compliance can therefore attract custom by creating a more positive brand image. On the other hand, businesses listed as ‘non-compliant’ could find their reputation tarnished.
How to Comply with ESOS
To comply with the scheme, companies must complete an ESOS assessment. It involves the following steps:
- Calculate total energy consumption – encompasses the combined energy use of all assets across the group or organisation. This analysis can be difficult alongside the usual day-to-day operations of the business. As such, many companies can benefit from the help of professional factory consultants when complying with ESOS.
- Identify areas of significant energy use – these are activities or assets that make up at least 90% of the business’ total energy consumption. You can then get these assets covered by DECs, GDAs, ISO 50001, ESOS energy audits, or a combination of these.
- Appoint a lead assessor – this individual will carry out and oversee the ESOS assessment, as well as energy audits. A lead assessor can come from within your organisation so long as they’re a member of an approved professional body register.
- Submit notification of compliance – shows you’ve undertaken an ESOS assessment, and the business is fulfilling its obligations. This can be done online via the notification system.
- Keep records – businesses should record how they have compiled ESOS data and what was found. There isn’t a set format for keeping ESOS records, however, the more detailed the better.
If your organisation is fully covered by ISO50001 you don’t need to worry about completing an ESOS assessment.
Expert Food Factory Design Consultants
The final deadline for phase 3 ESOS reporting is December 5th 2023. By using experienced factory consultants like FESS, you’ll be able to get your report ready in advance. We offer bespoke project management and consulting services to make sure your business is well positioned to benefit from schemes like ESOS.