Government consults on strengthening ESOS to meet net zero
The government has outlined proposals that would see major changes to the Energy Savings Opportunity Scheme (ESOS), including requirements for organisations to disclose their ESOS data publicly and carry out a net zero assessment.
The consultation is open until the end of September and changes are likely to come into force during the current phase (Phase 3), which runs until 2023.
Among the proposed changes, BEIS is looking at how the standard and quality of ESOS audits could be improved, with the goal of improving uptake of recommendations.
This includes plans to standardise auditing methods and information required, and tighten requirements around site sampling, use of de minimis exemptions, and use of energy data.
It wants reports to include metrics that allow participants to better judge their energy performance and include more focus on energy management and behaviour change.
The proposals also look to improve the quality of ESOS lead assessors – by reviewing the current processes through which they are certified by professional bodies, and the processes that ensure they are appropriately qualified.
Net zero assessments
The government is also considering how ESOS could be better designed to align with net zero targets.
Under the proposals, organisations would be required to carry out an assessment of which current energy-using processes and activities need to be addressed to become net zero by 2050.
They would need to outline current technologies used, and then identify what the low and/or zero carbon options are for each technology, the potential for investment and cost-effectiveness in the shorter or longer term, and when a suitable upgrade could take place.
Organisations may also be required to publicly disclose high level information from their ESOS report on a central website and set a target or action plan which they are required to report against. This would allow organisations to compare their performance with similar participants, allow third parties to compare ESOS data, improve the quality of audits and increase transparency.
The document stresses that there would be no penalty for not achieving the target/plan other than a reputational risk, neither would it be in a “league table” format.
Alignment with SECR
The proposals also seek to better align ESOS with Streamlined Energy and Carbon Reporting by changing the ESOS qualification thresholds to match SECR. Businesses would be in scope of ESOS if they meet at least two of the following criteria: at least 250 employees, a balance sheet of £18 million or turnover of £36 million. This may mean that some businesses will be under the scope of ESOS for the first time.
The proposals stress the need for both schemes to complement each other to reduce administrative burden, but outlines the distinct remit of each, and confirms there are no plans to merge both schemes.
Longer term plans – extending the scope to medium sized businesses?
The consultation is also seeking views on extending the scope of ESOS to medium sized businesses, and mandating action on energy efficiency recommendations. If these changes were to go ahead, they would come into play in Phase 4 of the scheme.
The consultation runs until 28th September 2021. You can respond on the gov.uk website.
At Concept we’ve helped many organisations achieve ESOS compliance and go further by implementing energy efficiency measures. If you’d like advice on the upcoming changes to ESOS Phase 3, or support with your ESOS audit, get in touch.