The news is in; ESOS benefits firms far more powerfully than previously believed
New Carbon Trust numbers show ESOS cuts energy costs beyond initial Government estimates.
Data released in April shows early estimates on how beneficial ESOS could be for UK business fell well short of the mark.
The new research, delivered by The Carbon Trust using a sample of ESOS assessments, shows the scheme has potential to run more powerfully and further than believed.
The Carbon Trust analysis on ESOS
Based on analysis of 86 full audits carried out by the organisation, the Trust found the average energy spend of ESOS qualifying organisations to be around £1.8m, meaning that a business with an average energy spend and average reductions identified through ESOS would be in line for savings of £360,000.
‘This is much higher than previous estimates made by the Department of Energy and Climate Change (DECC), which suggested that ESOS could collectively save businesses £250m if just 5% reductions in energy bills were achieved,’ wrote the Carbon Trust’s energy consultant David Tobin.
He told EDIE: “The real impact of the regulations could be far greater than expected if organisations make sure that their ESOS evidence packs become the basis for action.
“The next compliance deadline is almost four years away and it is inevitable that some ESOS evidence packs will sit on a shelf collecting dust until then. But for those businesses that do seize the opportunities highlighted by ESOS the average overall payback period for measures we identified was less than 3 years.”
At Concept Energy Solutions, we agree that seizing the moment is key. “As certified ESOS Lead Assessors, Concept carried out many ESOS audits in the lead up to the December 2015 deadline – and indeed beyond” says Peter Stockwell, Managing Director.
“In many cases our consultants identified energy saving opportunities which required very low, or no cost, such as rectifying building controls issues, or switching off equipment when not needed. The savings achieved through these simple measures can then help fund larger capex projects, such as lighting upgrades or replacement boilers.”
How should businesses react?
It is clear that ESOS participants should make the most of having to undergo a compliance process and pursue the significant cost savings on offer, that will have been identified in the ESOS audits.
Energy management, lighting, heating and sub metering were popular recommendations identified through ESOS audits, with organisations able to save around 25% on average.
Tobin’s bottom line argues the 10,000 businesses affected by ESOS are facing total assessment costs estimated at £165m. But, as identified by the Trust, the resulting financial benefits of implementing energy efficiency improvements could massively outweigh the costs of administrating the scheme.
The bottom line
Concept Energy Solutions’ own findings are consistent with the Carbon Trust’s research. As ESOS Lead Assessors and a firm that offers carbon reduction solutions, we are keenly aware of how big potential benefits are.
Now, it is for businesses UK wide to respond to these and embed ESOS recommendations in their Carbon Reduction Plans.