ESOS Phase 3 – Are you compliant and do you now qualify?

Introduced by the UK Government in 2014, ESOS – The Energy Savings Opportunity Scheme – is now in phase 3 of reporting. Its aim is to encourage businesses to implement energy-saving measures and reduce their carbon footprint.

This means that all businesses meeting the ESOS Phase 3 qualification criteria must submit their compliance to the Environment Agency by 5 June 2024. It is important that all businesses check their qualification status, even if they did not qualify for previous phases of ESOS.

As this is a legal requirement, failure to meet this deadline could lead to substantial fines, so it is important to ensure compliance.

Does your business meet the qualifying criteria?

The qualification date for Phase 3 of ESOS is 31 December 2022. If your organisation was classed as a “large undertaking” on that date, then it will fall under the scope of ESOS and will need to submit compliance.

For the purposes of ESOS Phase 3, a large undertaking is any UK company that:

  • employs 250 or more people
  • has an annual turnover in excess of £44 million, and an annual balance sheet total in excess of £38 million

The Government has also confirmed that there will not be any changes to these criteria before the qualification deadline. So, if your company met these criteria on the qualification date, it must carry out an ESOS audit, produce a subsequent report and submit a notice of compliance, even if it has subsequently changed in size and no longer meets the criteria.

If your organisation qualified for ESOS Phase 2 but no longer meets the criteria for Phase 3 on the qualification date, you are advised to submit a DNQ (Do Not Qualify) notification to the Environment Agency. Please note that subsidiaries of parent companies that qualify will also fall under the criteria.

ESOS is a ticking clock

If you have previously submitted an ESOS report you will already know that starting your preparations early is the best approach – not only to ensure you have the time to report accurately, but because the closer we get to the compliance deadline, the more demand there is for qualified lead ESOS assessors and many will get booked up early.

If you are unsure if you now qualify or need advice to understand what to do next to meet these legal obligations please get in touch.

The whole point of ESOS is to encourage businesses to carry out energy-saving measures that will ultimately benefit them by saving money as well as carbon.

FPA Consulting can manage the process for you – taking all of the effort and worry away from your business, leaving you to focus on what you do best while we use our expertise to ensure your ESOS obligations are followed.

We can also assist with helping you achieve ISO 50001 – a recognised management standard that helps identify significant areas of energy consumption and therefore spend so you can create an effective framework to target reductions in energy consumption. Full ISO 50001 accreditation also exempts businesses from undertaking an ESOS audit.

Post by:

Ian Coates

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