Time to comply with ESOS?

Ian Guest urges companies to find out if they have an ESOS obligation and outlines steps that need to be taken to ensure compliance.

2018 has ended, meaning the qualification date for the Energy Savings Opportunity Scheme (ESOS) has passed and the compliance deadline is now only 11 months away!

You may be thinking you still have a while to get your ducks in a row, but if your business is obligated I would strongly encourage you to book in a Lead Assessor as soon as possible to avoid delays in completion of the ESOS Assessment.

Is my business obligated?

Before acting you need to find out if your business needs to comply.

If your company, or any one UK company within the corporate group, meets the definition of a large undertaking it has an ESOS obligation.

A large undertaking is a company which on 31 December 2018 had 250 or more employees, or a balance sheet exceeding 43 million Euros and a turnover of 50 million Euros. As the qualification date has now passed, Euros can now be converted to Pounds Stirling. So, based on the exchange rate of 31 December 2018, a balance sheet of approximately £38,566,700 and turnover of approximately £44,845,000.

Please note that figures still quoted on the government website and within ESOS guidance are much lower, as they refer to ESOS Phase 1, NOT Phase 2. Please make sure you’re not using these figures, otherwise your company may end up complying when it doesn’t need to. The Environment Agency has said that it expects to publish updated guidance within the next month.

For companies that have grown, the ‘two-year rule’ will need to be considered, meaning you need to look at the company size over a consecutive two-year accounting period. If the business meets the criteria for the first time in the accounting period ending on or before the 31 December 2018, it is likely it will not need to comply. Our ESOS document is a great reference point if you’re unsure if your business needs to comply, as it outlines some of the considerations for the thresholds.

I know my business is obligated. What are the next steps?

Now is the time to make sure energy monitoring is in place to capture an accurate 12 months’ data and calculate total energy usage. This needs to include the 31 December 2018 and all energy consumption and sources should be captured. There are NO exceptions! You may already have records for main consumption, such as electricity, but is monitoring in place for smaller or adhoc supplies? Some companies have needed to put new mechanisms in place to ensure they have adequate records. For example, staff expensed mileage.

You should also identify your energy auditor and, if different, your Lead Assessor (LA). In the previous phase, due to Lead Assessor demand, we saw fees increase as the compliance date got closer. It is therefore prudent to identify your LA sooner rather than later.

Valpak can help

Whether you’re new to ESOS or getting ready for phase 2, Valpak can offer a service to help you ensure compliance, contact us.

Alternatively, why not visit our events page and book a place at one of our free support sessions or energy webinars, or simply give one of our experts a call on 03450 682 572 to discuss your requirements or get your questions answered.