The Energy Savings Opportunity Scheme (ESOS) is a mandatory energy assessment scheme for large UK organisations. If your business meets the criteria, you must audit your energy use and report on opportunities to improve efficiency, every four years.
Here’s what you need to know…
What is Energy Savings Opportunity Scheme (ESOS)?
ESOS is a UK government scheme that requires qualifying businesses to:
- Measure total energy consumption across buildings, transport, and processes
- Conduct energy audits to identify cost-effective savings
- Report compliance to the Environment Agency
- Keep an evidence pack for audit purposes
It runs in phases. Phase 3 compliance closed on 5 June 2024. The next reporting cycle, Phase 4, is now on the horizon – so preparation should start now.
Who needs to comply?
You must take part in ESOS if your organisation, or any part of your corporate group, met any of the following on the qualification date:
- 250 or more employees
- Annual turnover of more than £44 million and a balance sheet total over £38 million
- UK operations that fall within a qualifying group structure
Even if your energy use is relatively low, you still need to comply if you meet the size threshold.
What happens during an ESOS audit?
A qualified lead assessor must carry out or review your audit. The process typically involves:
- Reviewing energy use across your sites, fleet, and operations
- Identifying areas of inefficiency or avoidable waste
- Making recommendations for improvements (implementation is not mandatory)
- Ensuring findings are backed by accurate, up-to-date energy data
Also read: What does an energy consultant do?
What’s required for Phase 4?
While the official deadline for Phase 4 has not yet been announced, it will likely follow the same four-year cycle – meaning qualification will be based on 2026 data, with submission expected in 2027/28. To prepare:
- Start collecting energy consumption data now
- Identify which assets and sites need to be included
- Use tools like EMMA AI to centralise and clean data
- Engage a lead assessor early to reduce last-minute risk
Related post: How to manage your energy data
What are the risks of non-compliance?
Failure to comply with ESOS requirements can result in:
- Fines of up to £50,000
- Daily penalties for continued non-compliance
- Reputational damage and increased audit scrutiny
Avoiding this is simple – plan early and keep your data in order.
Beyond compliance: unlocking savings
While ESOS doesn’t require you to act on the audit findings, most organisations uncover opportunities for low-cost or no-cost savings. That means ESOS isn’t just a compliance task, it can be a cost-cutting opportunity.
Plan ahead, save more
Optimal Monitoring helps businesses simplify ESOS compliance and turn audit data into actionable savings. With EMMA AI and expert consultancy, we make it easy to stay compliant and cut energy waste. Let’s talk about how we can support your Phase 4 strategy.
Useful links …
How the UK hospitality sector can seriously reduce its energy bills.
How AI Is Transforming Energy Management for Commercial Buildings
Why Energy Monitoring Matters in Commercial Buildings
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