ESOS Advice

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ESOS (Energy Savings Opportunity Scheme) is a mandatory energy assessment and energy saving identification scheme for large undertakings (and their corporate groups).

ESOS is the Department of Energy and Climate Change (DECC) response to the requirement for all Member States of the European Union to implement Article 8 of the Energy Efficiency Directive.

It’s aim is to increase business profitability and competitiveness by encouraging better monitoring of energy consumption and identifying cost-effective savings.

The scheme is estimated to lead to £1.6bn net benefits to the UK, with the majority of these being directly felt by businesses as a result of energy savings

The scheme applies throughout the UK.

ESOS Assessment requires participants to do three things:

1. Measure your total energy consumption across your buildings, transport and industrial activities.

2. Conduct energy audits to identify cost-effective energy efficiency recommendations. You must ensure that at least 90% of your total energy consumption is subject to at least one of the following audit methods:

ESOS energy audit

Display Energy Certificate

Green Deal Assessment or a certified

ISO 50001 Energy Management System

3. Report compliance to the Environment Agency By 5 December 2015, You must ensure that your ESOS Assessment has been reviewed by a Board-level Director and approved by a Lead Assessor.

ESOS will operate in four-yearly compliance phases. The qualification date for the first phase 1 is the 31st December 2014.

The scheme compliance bodies will have the authority to apply civil penalties against an organisation/group found to be required to participate in ESOS and found to be non-compliant with its requirements.

Penalties that may be issued are as follows:

For all non-compliances, the compliance bodies will have the power to publishinformation on non-compliance on their website such that this information is available tothe public.

Failure to notify the Scheme Administrator– there will be a fixed penalty and an additional penalty for each day of non-compliance.

· A fixed penalty of up to £5,000; and/or

·An additional £500 for each day starting on the day after the date of compliance until the notification is completed, subject to a maximum of 80 days; and/or publication of details of non-compliance by the compliance bodies.

Failure to maintain adequate records to demonstrate compliance with ESOS– the penalty which can be applied is:

·A fixed penalty of up to £5,000; and/or

·The cost to the compliance body for undertaking sufficient auditing activity to confirm that an organisation has complied with ESOS; and/or publication of details of non-compliance.

Failure to undertake an ESOS Assessment -there will be a discretionary penalty allowing the compliance body to require the participant to take a number of steps toward compliance and a fixed monetary penalty. Failure to comply with any aspect of an ESOS Assessment (not using sufficient data, not using a Lead Assessor etc.) would be considered failure to comply. Where non-compliance is explained under ‘comply or explain’ provisions then the compliance body will consider whether the justification given is reasonable before determining whether to impose a penalty.

The penalty is:

·A requirement to conduct an ESOS Assessment by a date specified by the compliance body; and/or

·A penalty of up to £50,000; and/or

·An additional £500 per day penalty for each day starting on the day after the compliance date that the organisation remains non-compliant, subject to a maximum of 80 days; and/or publication of details of non-compliance.

Failure to comply with an enforcement, compliance or penalty notice will incur a fixed penalty and an additional penalty for each day of non-compliance. This in order to encourage compliance as soon as possible. The penalties are:

· A fixed penalty of up to £5,000; and/or

·An additional £500 for each day starting on the day after the date of compliance until the notification is completed, subject to a maximum of 80 days; and/or publication of details of non-compliance.

For making a statement which is false and misleadingthere will be a monetary penalty that is flexible enough to take account of the nature of the misdemeanour and large enough that it can act as a deterrent to this offence. The penalty is:

·A monetary penalty of up to £50,000; and

· Publication of details of non-compliance.

The compliance bodies will be able to pursue corrective action and will also have the power to reduce and waive penalties after issuing them to participants.

Source: DECC ‘Guide to ESOS, 2014′

You must ensure that at least 90% of your total energy consumption is subject to at least one the approvedaudit methods. Unless your total energy consumption is covered by a certified ISO 50001 Energy Management System, you must ensure that your ESOS Assessment is conducted or reviewed by a qualified Lead Assessor.

At first you need to measure your ‘total energy consumption’ over a 12 month period (it must overlap with 31st December 2014 – Phase 1).

This must be accross all aspects of your business:

  • Buildings
  • Transport
  • Industrial Processes

It is important to start to consider the problems that may arise from this. For example, if within your company your employees travelsignificantbusiness miles, how are these recorded and how will you access this information? The legislation requiresLead Assessors to convert business miles to energy used, but the assessor needs to be able to access the raw data.

Once you have measured your total energy consumption, ESOS requires that you identify areas of significant energy use. The areas of significant energy use must account for at least 90% of your total energy consumption. These areas must then be subject to a ESOS energy audit.

Our assessors will happily talk you through the detail of what information is required. We recommend that you contact us to talk through your options. We offer a free, no obligation, company review, pleaseclick hereto find out more.

If you fall within the regulation, you must submit your ESOS reportby the 5th December 2015, this is known as phase one’s ‘compliance date’. There are 3 phases identified by DECC (Seetablebelow). The 12 month energy measurement period for phase one must overlap 31st December 2014. For example, if your selected 12 month period runs 01/04/2014to 31/03/2015, your 12 month period overlaps 31/12/2014. The ESOS audit, detailing energy efficiency recommendations for your significant energy uses, can be conducted up to four years before the compliance date. ESOS phase dates

It is hard to accurately gauge what the total cost of an ESOS report due to variations in complexity and type of companies that fall within the regulation.

We can state that our Display Energy Certificates business (an approved ESOS audit method) currently offers what we believe as one of the best rates on the market.

To discuss further and to obtain a more accurate quote, we recommend that you contact one our experts for afree reviewof you companies ESOS requirements.