ESOS Phase 3

Energy Saving Opportunity Scheme (ESOS) Phase 3

What is esos phase 3?

The Energy Savings Opportunity Scheme (ESOS) is a mandatory energy assessment scheme for large organisations based in the UK. It was first implemented in 2014 in response to the EU Energy Efficiency Directive and has four phases. We are currently in Phase 3, with Phase 1 having run between 31 December 2014 and 5 December 2015 and Phase 2 being run from 31 December 2015 to 5 December 2019. ESOS requires organisations that meet the qualification criteria to audit and report on at least 90% of their energy usage to The Environment Agency every 4 years.

What is the purpose of ESOS? ESOS is designed to give organisations the opportunity to conduct an in-depth review of their energy use in order to identify ways to improve energy efficiency. This allows businesses to reduce their usage and costs whilst helping to tackle climate change and lead the UK towards a higher level of energy security.

ESOS Phase 3 Deadline: 5th December 2023

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ESOS Phase 3

ESOS Deadlines Phase Qualification date

Compliance date

Compliance period

1

31 December 2014

17 July 2014 - 5 December 2015

5 December 2015

2

31 December 2018

6 December 2015 - 5 December 2019

5 December 2019

3

31 December 2022

6 December 2019 - 5 December 2023

5 December 2023

4

31 December 2026

6 December 2023 - 5 December 2027

5 December 2027

Fines of up to £90k can be issued to businesses who fail to meet the ESOS deadlines, therefore it is sensible to get ahead and start preparing for ESOS Phase 3 early.

Due to the Coronavirus Pandemic, the Environment Agency did give extensions and delayed fines being issued for Phase 2, however it is very unlikely they will do this again for Phase 3.

How do I know if i qualify?

To qualify, you must meet one of the below criteria for two consecutive accounting periods working back from the qualification date. For ESOS Phase 3, this is 31 December 2023.

You have over 250 employees in the UK An annual turnover exceeding €50m (£44.1m) or An annual balance sheet exceeding €43m (£37.9m) You are an overseas organisation with over 250 employees in the UK. Your company is part of a larger organisation, which falls into any of the above.

ESOS applies to large UK enterprises and their corporate groups. It mainly affects private businesses but can also be applicable for not-for-profit organisations and any other nonpublic sector enterprises that are large enough to meet the qualification criteria.

Public sector organisations do not usually need to comply with ESOS.

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ESOS Phase 3

Completeing your assessment Organisations do not need to pre-register with the Environment Agency but must notify the Environment Agency by the set deadline that they have complied with their ESOS obligations.

The initial assessment include audits of the energy used by buildings, industrial processes and transport to identify cost-effective energy saving measures. Once the assessment is complete, it needs to be verified by a qualified Lead Assessor – Advantage Utilities can provide a Lead Assessor for you.

ESOS assessment process Stage 1: Assessing your total consumption and gathering the data required for the audit.

Action 1: Calculate your total consumption You need to measure all energy that your business consumes in its day to day activities. This includes for your buildings, industrial processes and transportation; including energy from combustible fuels, renewable energy, steam, heat and electricity from any other sources (including electricity generated on-site).

Action 2: Define your 'de minimis' ESOS mandates that you carry out energy audits for 90% of your total energy consumption.

That means that you have a decision to make about which 10% of your consumption you exclude. The energy you are choosing to exclude is referred to as your ‘de minimis energy consumption.’

Stage 2: Auditing your data and identifying where efficiency savings can be made.

Action 1: Find a lead assessor Lead Assessors will be responsible for verifying your calculations of your total energy consumption, reviewing your de minimis and checking that you are compliant via your audits. Advantage Utilities can provide an accredited Lead Assessor to carry out the task for you.

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Esos Phase 3

Action 2: Audit your energy use and identify cost-effective saving measures Once you have compiled your data you can now begin working closely with your Lead Assessor, who will take you through the process of auditing and reporting your energy consumption and help you identify where and how you can make efficiency savings.

Action 3: Get sign off on your energy saving recommendations from a director When you’ve finished your ESOS assessment, board level director(s) will have to sign off on your compliance and review the cost-effective energy savings that have been identified.

Action 4: Notify the Environment Agency of your compliance The last thing to do is to submit your ESOS assessment to the Environment Agency. The notification includes details about your organisation and how it has complied.

What next?

Get started early to meet the ESOS Phase 3 Deadline.

When it comes to preparing your ESOS assessment, aside from your Directors sign off, Advantage Utilities can deal with everything for you, from start to finish we aim to make compliance non-onerous and straight forward.

Collecting quality data is key in the success of your ESOS compliance. You need the right team and the right software to know exactly how much energy you are using at all your sites, what factors are affecting your energy usage and how much it’s costing you.

Luckily, Advantage Utilities have access to just the tool you need to collect ultra-precise data to meet your auditing requirements - Advantage Analytics, our premium data collection software for all meter types; from large electricity supplies to sub-metering of specific equipment, and even gas metering with added Automatic Meter Reading, Advantage Analytics gives you ultra-accurate data into your usage which you can turn into actionable insights.

Contact Us 0207 371 5360 info@advantageutilities.com www.advantageutilities.com The Coda Studios, 189 Munster Road, London, SW6 6AW

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