WHAT IS ESOS?
The Energy Saving Opportunity Scheme (ESOS) is a mandatory UK government scheme requiring large organisations to measure their total energy consumption—covering buildings, transport and industrial activities—and complete an energy audit every four years. Its purpose is to identify cost-effective energy-saving opportunities that help reduce energy use, cut costs and lower carbon emissions.
Energy Saving Opportunity Scheme reports help identify potential cost savings for your building.
The Energy Saving Opportunity Scheme demonstrates your organisation’s commitment to sustainability.
Government Regulations
ESOS was established by the Department of Energy and Climate Change (DECC) in response to the requirement for all Member States of the European Union to implement Article 8 of the Energy Efficiency Directive 2012. The regulations were implemented in the UK by The Energy Savings Opportunity Scheme Regulations 2014. It is consistently updated and managed by the Environment Agency.
Eligibility for ESOS
An organisation qualifies for ESOS if, as of 31 December 2014, it is considered a ‘Large Enterprise’, i.e.:
- You have more than 250 employees in the UK; or
If you have fewer than 250 employees in the UK, your business must meet the following criteria:
- An annual turnover exceeding £44m; and
- A balance sheet exceeding £38m; or
- You are part of a corporate group containing a large enterprise
This definition includes not-for-profit bodies outside the public sector, so long as they are large enough to meet the qualifying criteria. Currently Public bodies are not subject to the ESOS directive.
Timeframes for ESOS deadlines
The Energy Savings Opportunity Scheme runs in four year compliance phases. Each phase requires a new energy audit to be carried out. The phases are as follows:
- Phase 1 was from 6 Dec 2011 – 5 Dec 2015
- Phase 2 was from 6 Dec 2015 – 5 Dec 2019
- Phase 3 was from 6 Dec 2019 – 5 Dec 2023 (with some extensions allowed)
- Phase 4 is from 6 Dec 2023 – 5 Dec 2027
Organisations that qualify at the qualification date (usually 31 December before the phase starts) must submit a notification of compliance by the phase deadline (usually the 5th December).
Conducting an ESOS Assessment
To comply with regulations large enterprises will need to undertake an ESOS Assessment, including the following elements:
Assessment of total energy use across property, industrial operations and transport activities.
Determining which parts of your organisation contribute the majority (95% or more) of total energy consumption.
The assessment must be overseen by a Lead Energy Assessor registered on an approved list, appointed either internally or externally.
Establishing which energy efficiency improvements are most cost-effective across high-consumption activities.
Initial audits must be completed and submitted to the Environment Agency by the compliance date (typically 5th December in the phase-end year), with subsequent audits and notifications required at four-year intervals.
Our Professional Support
Our qualified assessors will carry out a full energy audit on your behalf. They will first evaluate your organisation’s total building energy consumption and then focus the audit on the most energy intensive areas identified through their initial analysis.
ESOS reports require review and sign-off by an accredited Lead Assessor. Our qualified team includes Lead Assessors which are fully equipped to perform these tasks.
After completing the first two steps, our assessors will submit your compliance notification to the Environment Agency by the required deadline. Notifications are filed through the Environment Agency’s online portal, MESOS (Manage your ESOS).
The final report is prepared and ready for your sign-off.
does your building require an action plan?
The action plan outlines what energy-saving measures a business will implement after conducting an energy audit. The considerations for an action plan are as follows:
- If you were required to submit a notification of compliance for the third compliance period (with the deadline extended from 5 December 2023 to 5 June 2024), you must also provide an action plan and progress updates during the following relevant compliance period.
- If you did not qualify for ESOS in the third compliance period, you are not required to complete an action plan or any progress updates in the subsequent compliance period.
- The action plan must be signed off by a board level director (or equivalent), and submitted via the Manage your ESOS (MESOS) reporting system by the action plan deadline. The deadline for the third compliance period (or phase) was 5th December 2024, which was extended with no remedial action if submitted by 5th March 2025.
Scheduled Requirements for Progress Reports
After submitting your ESOS Action Plan, you must provide an annual progress update for the following two years. Each update is due 12 months after the Action Plan deadline, and then 12 months after the first progress update submission. For ESOS Phase 4, the qualification deadline is 5 December 2026 and the compliance deadline is 5 December 2027. Each progress update must be approved by a board-level director (or equivalent) and submitted through the MESOS portal.
failure to comply
Fixed Penalties: Up to £5,00 for failing to maintain records.
Energy Audit Penalties: Up to £50,000 fines for failure to conduct an energy audit.
Daily penalty of £500 for each day of non-compliance, capped at 80 days (totalling a maximum of £90,000).
Publication of non-compliant organisations’ names by the Environment Agency.