What is ESOS – will we need a mandatory energy audit?

ESOSThe Energy Savings opportunity Scheme (ESOS) is a mandatory energy assessment and energy saving identification scheme for large undertakings (and their corporate groups) applied throughout the UK. Organisations that qualify must carry out ESOS assessments every 4 years. These assessments are audits of the energy used by their buildings, industrial processes and transport to identify cost effective energy saving measures .

The potential net benefit of this policy to the UK is between £0.8 billion and £3 billion with a central estimate of £1.9 billion Net Present Value between 2015 and 2030 through the implementation of energy efficiency measures.

Who is included in the scope of ESOS?

ESOS applies to large UK undertakings and their corporate groups. It mainly effects businesses, but can also apply to non-profit and any other non-public sector undertakings that are large enough to meet the qualification criteria. Your organisation qualifies if on 31st December 2014, it meets the ESOS definition of a large undertaking. Corporate groups also qualify if at least one UK group member meets the ESOS definition of a large undertaking.

A large undertaking is an organisation that carries out a trade or business which:


  • Employs at least 250 people; or
  • Employs fewer than 250 people but has an annual turnover in excess of 50 million Euros and an annual balance sheet in excess of 43 million Euros.


  (For more information on how to assess if you qualify or how to calculate your average number of employees, please visit https://www.gov.uk/energy-savings-opportunity-scheme-esos).

Completing an ESOS assessment

If you qualify for ESOS and your organisation is fully covered by ISO 50001 you don’t need to carry out an ESOS assessment, you just need to notify the Environment Agency that this is the case (for more information about ISO 50001, please visit http://www.iso.org/iso/home/standards/management-standards/iso50001.htm). If you qualify for ESOS, but your organisation is not fully covered by ISO 50001 you will need to carry out an ESOS assessment to calculate what you need to do to comply with the ESOS regulations.

(The regulations can be found at http://www.legislation.gov.uk/uksi/2014/1643/contents/made). 

For this assessment, you will need to:

1) Calculate your total energy consumption.

This is the energy used by assets held or activities carried out by your organisation or group. This includes the energy consumed by buildings, industrial processes and transport.


2) Identify your areas of significant energy consumption.

This means the energy used by assets held, or activities carried out by your organisation that account for at least 90% of your energy consumption. You must then find out whether ISO 50001, DEC’s, or GDA’s cover any of your areas of significant energy consumption. If they do not, then you need to identify whether ESOS compliant energy audits have been, or need to be carried out for the areas of significant energy consumption.



3) Appoint a lead assessor.

You will need to appoint a lead assessor to carry out, oversee or review your energy audits and overall ESOS assessment. The assessor can be employees or external contractors as long as they are members of an approved professional body register.


4) Notify the environment agency.

  You must notify the environment agency that you have undertaken an ESOS assessment before the compliance date of 5th December 2015, and if applicable, every 4 years afterwards.

5) Keep records.

Keep records of how you have complied with ESOS in an evidence pack.