ESOS Phase 2: what do you need to know?

As ESOS Phase 2 is officially being initiated, it’s important to understand what ESOS is and how it helps the environment. As this scheme is mandatory for all organisations outside the public sector in the UK that meet the qualification criteria, it’s crucial that these organisations are aware of what this scheme entails - and what is required of them to comply with its regulations.

What is ESOS?

ESOS stands for Energy Savings Opportunity Scheme, and is a government established scheme. Designed to implement Article 8 of the EU Energy Efficiency Directive (2012/27/EU), ESOS is an energy scheme for organisations. The ESOS regulation was designed to lead to better energy efficiency, cost savings and carbon reduction for organisations that meet the qualification criteria.

ESOS takes into account a business’ entire energy usage, as well as individual energy uses by employees, transport, buildings and industrial/commercial processes. At the time of introducing ESOS, the regulation was relevant to more than 10,000 big UK companies. It was required for all applicable organisations to notify the Environmental Agency, the scheme’s administrator, of their chosen course of action by 5th December 2015.

Due to the low figures announced by the Environment Agency, the deadline was then extended to 30th June 2016. By the deadline, organisations that qualified were required to have carried out their energy assessments. These energy assessments must be repeated at least once every 4 years. Failure to comply for any phase can result in fines of up to £50,000.

ESOS compliance

The criteria for ESOS to be mandatory included the following:

- A minimum of 250 members of staff

- An annual turnover exceeding £43M, and an annual balance sheet exceeding £37M

- An overseas company with a UK registered establishment which has 250 or more UK employees (paying income tax in the UK)

If an organisation had one or more of the qualifications, it was compulsory for them to comply to ESOS regulations. Organisations in the public sector were excluded from this. To comply with ESOS, organisations needed to carry out an ESOS assessment - unless they were fully covered by ISO 50001. According to GOV.UK, these assessments took into account “energy directly covered by Display Energy Certificates (DECs), Green Deal Assessments (GDAs), or ISO 50001”, and helped to work out what actions were required to ensure ESOS compliance. It is worth remembering that some of these options for ESOS Phase 1 may not be applicable for ESOS Phase 2 - so it’s vital to stay up-to-date on rules and regulations.

What is ESOS Phase 2?

As the energy assessment must be renewed every four years, this means that a new compliance period starts shortly. The qualification date for Phase 2 is 31st December 2018; this means qualifying organisations must submit proof of compliance that covers the period from 6th December 2015 to 5th December 2019. Depending on the route that organisations chose originally, there are existing documents and audits that can be used as proof of compliance for Phase 2 of ESOS.

How Utilitas can help

Starting now, Utilitas can help your organisation to be better prepared for Phase 2 thanks to our online automatic monitoring and targeting platform. Utilitas has maintained a 100% compliance rate, unlike many organisations which only reach 90% due to difficulty  accounting for all areas. More importantly than this, however, our energy assessments have frequently identified areas of savings so significant that it ultimately more than pays for the assessment.

With automatic monitoring and targeting, the access to data makes it much easier to conduct the assessment - and raises the potential for savings substantially. Utilising both approaches also improves the chance of better efficiencies in the future. For more information about the work we do, or how we can help you to comply with ESOS Phase 2, take a look at the industries we work with, or contact us today.