Key points
Recent statistics have indicated that nearly three quarters of businesses (73%) have not started their mandatory energy audits to comply with the new ESOS legislation by the deadline of 5 December 2015.
The new rules apply to all ‘large organisations’ in the UK and will include many in the processing industry. So, does this apply to you? And, are you ready? I have put together a quick guide to all you need to know about ESOS compliance – see the boxed panel.
If you haven’t made a start, I strongly urge you not to delay a moment longer. With fewer than 500 lead assessors available for the 10,000 plus organisations which need to comply with ESOS, I have real concerns over the pressure on supply. Leave it too late, and you might not be able to find a lead assessor to work with you. And the holiday season is upon us.
The same survey, by Energy Live News, reported that 52% of organisations are citing lack of time and resources as the biggest barrier and 27% admitting identifying and collating data as the main challenge to complying with the scheme.
An easy guide to ESOS compliance
The Energy Savings Opportunity Scheme Regulations 2014 (ESOS Regulations) were introduced in 2014 to promote energy efficiency.
According to government figures, organisations could save £1.9 billion on energy bills a year. Enistic’s monitoring and targeting campaigns typically identify energy savings averaging 28% but in some cases of as much as 45% or more.
The scheme is being administered by the Environment Agency.
Does ESOS apply to you?
Large enterprises need to conduct mandatory energy audits every 4 years. This covers:
– All organisations with over 250 members of staff.
– Or turnover of over 50 million Euros (£38,937,777) and an annual balance sheet total in excess of 43 million euro (£33,486,489).
What do you have to do?
If your company falls within the scope of the Regulations, you need to:
– Monitor and report your energy use across 90% of your site by 5 December.
– Appoint a ‘Lead Energy Assessor’. You can find a list of registered Lead Assessors at www.gov.uk/energy-savings-opportunity-scheme-esos
– The Lead Assessor will conduct an ESOS Assessment to:
– Measure your total energy consumption for buildings, industrial processes and transport over at least a 12 month period.
This assessment period must include 31st December 2014.
– Identify areas of significant energy consumption, accounting for at least 90% of your total energy consumption.
– Identify practical, cost-effective energy efficiency recommendations for areas of significant energy consumption
(based on a life-cycle cost and effectiveness analysis)
– Have the ESOS Assessment reviewed and approved by a Board-level Director, or where no Directors exist and approved by a Lead Energy Assessor.
– Report compliance to the Environment Agency by 5 December 2015.
The ESOS evidence pack
You need to compile and keep an evidence pack for your report to the Environment Agency.
This should include details of:
– The structure of your organisation
– The Board level Director(s), or equivalent who have taken the lead on signing off compliance with ESOS
– Your Lead Assessor and registration of approval
– The calculation of total energy consumption
– Areas of significant energy consumption listed
– Compliance method(s) used to cover each area of significant energy consumption
– Cost-effective energy savings opportunities identified along with a Return on Investment and Life Cycle Cost Analysis
– Certifications for alternative compliance routes
– Details of any areas where you are not fully compliant with the rules
What is the best approach?
The two most common approaches to ESOS compliance are:
– Undertaking ESOS audits and producing an evidence pack to be signed off by a lead assessor or
– ISO 50001 certification for the whole of the organisation which will count as compliance.
Below I have outlined the pros and cons for each so you can decide which approach is likely to work best for your establishment.
| ESOS | ISO 5001 |
|---|---|
| Pros | Pros |
| Identifies energy saving opportunites | Internationally recognised standard |
| Involves board level Director sign off meaning opportunities to save energy discussed | Involves top management buy in |
| Forms basis for an effective energy management system | Forms part of effective energy management system |
| Less paperwork and admin time than ISO 50001 | Helps achieve energy efficiency |
| Only has to be carried out once every 4 years | ​ |
| Can be completely outsourced, as assessors can sign off the evidence pack | ​ |
| ​ | ​ |
| Cons | Cons |
| Not as internationally recognised | Generally costs more than ESOS |
| No requirement to implement energy savings | More time consuming as requires more admin and paperwork |
| ​ | Has to be renewed each year |
| ​ | Have to use a separate certification body for sign off so involves two external companies |
How long does it take?
On average compliance takes between 2 – 4 months from the first scoping meeting to submission.
The Benefits of ESOS compliance
The monitoring and targeting systems implemented for ESOS compliance will highlight key areas for saving energy. As a result, the benefit from energy efficiency and cost savings can be considerable.
The ESOS assessment will:
– Identify energy saving opportunities with a pay-back period
– Analyse life cycle costs to determine effectiveness
– Provide clear energy improvement project costs along with estimated energy
There is no obligation to implement these energy savings opportunities.
How much does ESOS cost?
Prices for compliance can range from £3,000 – £20,000+. Each organisation is different, which is why we take a tailored approach.
What happens if you miss the deadline?
You could be fined up to £50,000 plus extra charges of £500 per day (for up to 80 days)
There is more details guidance on the ESOS scheme and compliance at; www.gov.uk/energy-savings-opportunity-scheme-esos
