ESOS compliance rate slows as deadline looms

EXCLUSIVE: The Environment Agency has received less than 250 new notifications of compliance from organisations that qualify for the Government's Energy Savings Opportunity Scheme (ESOS) in the space of a month, with just two weeks now remaining before the extended deadline.

Responding to a Freedom of Information request submitted by edie earlier this month, the Environment Agency’s ESOS project manager Jo Scully revealed that 4,242 out of the circa 10,000 eligible companies were fully compliant with the scheme as of last Friday (8 January), ahead of the revised deadline of 29 January.

This compares to approximately 4,000 companies that the Agency previously announced were ESOS-compliant by the initial submission deadline of 5 December.

In her Freedom of Information request response, Scully also revealed that the Environment Agency had received 2575 notifications of ‘intent to comply’ with ESOS as of 8 January. However, 232 of these organisations have now submitted their notification of compliance so, in effect, 2,343 are outstanding and should submit their notification of compliance in due course.

According to those figures, the total compliance rate for ESOS by the 29 January deadline would stand at 6,585 – around two thirds of all qualifying companies – pending any additional submissions from organisations that haven’t yet notified the Environment Agency of their intent to do so.

Enforcement action

The Agency will therefore be hoping for a flurry of late submissions, similar to that seen for the original deadline last month. At that point, Scully said she was pleased with the compliance rate and had received “some good feedback on the benefits that compliance can bring”.

Scully has previously confirmed that any organisation covered by the scheme that submits a notification of compliance after 29 January risks ‘enforcement action’. When asked for information on exactly what this enforcement action would be, Scully responded: “Each non-compliance will be considered on a case-by-case basis, in accordance with our published enforcement approach.”

The Agency’s official document on enforcement and sanctions details that the maximum penalty for failing to undertake an energy audit ahead of the compliance deadline is up to £50,000 and up to £500 for each working day the responsible undertaking remains in breach of the mandatory scheme, for a maximum of 80 working days.

But the document also states that civil penalties will normally be used only in the most serious cases and that, for the first compliance period and new entrants in subsequent compliance periods, the Agency would normally allow up to three months to remedy the failure before issuing any fines, meaning that the ultimate deadline would be 29 April.

Business benefits

ESOS requires all ‘large undertakings’ with more than 250 employees or a turnover of more than €50m to produce detailed reports on their energy use and efficiency every four years. Lead assessors will carry out an energy audit, paid for by the business, but there is no obligation to implement any of the efficiency measures identified. Read our full explanation of the scheme here

The 10,000+ businesses affected by ESOS are facing total assessment costs estimated at £165m, but the resulting financial benefits of implementing energy efficiency improvements could massively outweigh the costs of administrating the scheme. 

The Environment Agency’s response to this Freedom of Information request comes as the Government has published a new guide to support businesses in implementing the energy saving opportunities identified from ESOS assessments. Read the guide here

ESOS at edie’s 2016 Energy Management Forum

The potential energy-saving opportunities that the ESOS scheme could bring is to be discussed in depth at edie’s fifth annual Energy Management Forum in Birmingham on 20 April.

The CPD-certified event offers energy managers the chance to discover innovative ways to reduce energy consumption, learn how to make the business case for energy efficiency more attractive, and explore the benefits of specific on-site solutions.

Find out more and register to attend the Energy Management Forum here.

This article contains Environment Agency information © Environment Agency and database right.

Luke Nicholls

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