Energy Savings Opportunity Scheme: Is your business ready?

Companies across the UK are being urged to 'prepare now and get ahead of the game' before a new EU directive comes into force which will require larger firms to undertake mandatory energy-efficiency assessments.

The Department for Energy and Climate Change (DECC) is putting the finishing touches on the Energy Savings Opportunity Scheme (ESOS), which will oblige companies to produce detailed reports on their energy use, including the energy efficiency of their organisation.

Any company with more than 250 employees, a turnover of more than £41.5m of an annual balance sheet total of more than £35m will be affected by the ESOS, which is set to come into force over the next few months; to help the EU meet its target of reducing energy consumption by 20% by 2020.

Global supply chain risk management firm Achilles is urging businesses to act now.

“The ESOS scheme is already being seen by businesses as a real double-edged sword,” said Achilles’ head of CSR and sustainability Jon Williams. “Many businesses don’t measure and record their energy use and face a big administrative burden unless they get external support.”

Saving money

Achilles runs the Certified Emissions Measurement and Reduction Scheme (CEMARS), which is used by hundreds of companies to measure their energy use and emissions and to help them meet ISO accreditations.

Williams added that the upcoming implementation of the ESOS is actually an ideal opportunity for businesses to cut their energy costs.

“For those not already focused on carbon reduction and energy efficiency, ESOS compliance represents short-term pain for long-term gain,” he said. “Ultimately, this is a fantastic opportunity for companies to save thousands of pounds on their energy bills while communicating positive messages on their achievements.”

Key requirements

Exact detail of the ESOS will be unveiled in June but at a minimum, UK businesses will be required to provide:

    • A review of the total energy use and energy efficiency of the organisation
    • The amount of energy use per employee, focusing on key buildings, industrial operations and transport activities
    • Clear information on potential savings, which identify and quantify cost-effective energy-savings opportunities. Wherever practical these should be based on life cycle assessment (LCA) instead of simple payback periods (SPP)
    • Identification of an approved ESOS assessor (either an in-house expert or an external consultant) to conduct the assessment

The European Union’s Energy Efficiency Directive came into force in December 2012. It was agreed that businesses affected would have to comply; and carry out energy audits within three years – with a deadline of December 2015.

Public sector organisations will be exempt because they will have to comply with separate government procurement rules that require them to ensure that at least 3% of their floor areas are renovated each year to meet minimum energy performance requirements.

Luke Nicholls

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