Energy Savings Opportunity Scheme

ESOS stands for the Energy Savings Opportunity Scheme, the UK scheme created by the Energy Savings Opportunity Scheme Regulations 2014.

The word “opportunity” is literal: the audit at its heart must identify the energy saving opportunities that are cost-effective to carry out.

From Article 8 of Directive 2012/27/EU, which required Member States to ensure that enterprises that are not SMEs are audited by 5 December 2015 and at least every four years.

The UK implemented it through SI 2014/1643, in force on 17 July 2014, and kept the scheme after leaving the EU, amending it in 2023 and 2026.

The EU recast the Directive as Directive (EU) 2023/1791, whose Article 11 replaced Article 8 and moved from an SME test to energy consumption: a certified management system above 85 TJ a year and an audit above 10 TJ.

ESOS did not follow.

Its size test remains Schedule 1 of SI 2014/1643, and SI 2026/701 left the thresholds unchanged.

ESOS is a four-yearly audit and notification to the Environment Agency, followed by an action plan; SECR is an annual disclosure of energy use and emissions in the directors’ report.

Their size tests differ too: ESOS tests at least 250 persons or £44m turnover with £38m balance sheet, while SECR tests whether a company exceeds at least two of £36m, £18m and 250.

Neither discharges the other.

Yes.

The government consulted on strengthening the scheme, took powers to make changes in the Energy Act 2023, and made SI 2026/701 under it.

The Modernising corporate reporting consultation says DESNZ intends to consult on SECR and ESOS later in 2026, and DESNZ’s 26 May 2026 SECR review recommends keeping SECR with amendments.

A mandatory UK energy assessment scheme for large undertakings and their groups, created by the Energy Savings Opportunity Scheme Regulations 2014 and administered by the Environment Agency.

Every four years a qualifying group assesses its energy use, identifies savings opportunities and notifies the regulator; since Phase 3 it also publishes an action plan and progress updates.

The government’s consultation on strengthening ESOS opened on 6 July 2021 and closed on 28 September 2021, and the government response was published on 28 July 2022.

It asked about standardising audit reporting, putting net zero into audits and publicly disclosing high-level recommendations, and drew 89 responses.

SI 2023/1182 and SI 2026/701 followed.

Two: an energy audit, and ISO 50001.

SI 2026/701 removed Display Energy Certificates and Green Deal Assessments as routes from 22 July 2026, and widened ISO 50001 so that a certificate over all of total or all of significant consumption stands in for the lead assessor, the audit and the ESOS report.

The Environment Agency is the UK scheme administrator: it publishes the guidance, runs the helpdesk and collects notifications for the whole UK.

Enforcement sits with the regulator for the registered office: the Environment Agency in England, Natural Resources Wales, the Scottish Environment Protection Agency, the Northern Ireland Environment Agency, and the Secretary of State for DESNZ where activities are wholly or mainly offshore.

DESNZ is responsible for ESOS policy.

The Energy Savings Opportunity Scheme Regulations 2014 (SI 2014/1643), first made to implement Article 8 of the EU Energy Efficiency Directive.

They have been amended by SI 2023/1182 for Phase 3 and SI 2026/701 for Phase 4; the 2026 amendments were made under the Energy Act 2023, sections 254 to 260 and 263.

Every four years.

Regulation 4 sets compliance periods running from 6 December to 5 December four years later, with the qualification date on the 31 December before the compliance date.

Phase 4 runs from 6 December 2023 to 5 December 2027 and Phase 5 from 6 December 2027 to 5 December 2031.

Yes.

Regulation 10 requires the scheme administrator to publish specified notification information, every action plan and every progress update, each within six months of the relevant deadline or of the filing, whichever is later.

The Phase 3 action plans, first progress updates and notifications are published as open data on data.gov.uk.

Of 7,062 published action plans, 5,609 were followed by a first progress update, so 1,453 organisations, 20.6%, filed a plan and then no update.

Of 5,549 updates with a readable submission date, 80.6% were filed in the final 30 days and 11.2% after the 5 December 2025 deadline.

Across 30,481 measure rows, 24.0% were marked implemented.

The statutory maxima are £45,000 for failing to notify and £90,000 for failing to carry out an assessment, each counting the full daily penalty of £500 for 80 working days.

The £67,500 figure often quoted is the top of a calculation range in the Environment Agency’s published worked example, not a penalty anyone was ordered to pay.

The Agency does not publish an ESOS-specific penalty total.

Yes.

In one reported case the Environment Agency imposed £57,375 for failure to undertake an ESOS assessment, and the First-tier Tribunal found the Agency unreasonable, allowed the appeal and substituted £28,688.

If any UK undertaking in a corporate group qualifies, the whole UK group takes part, by default as one participant led by its highest UK parent.

Undertakings may disaggregate, or separate highest UK parent groups may aggregate, by written agreement kept in the evidence pack.

The Environment Agency’s guidance says a joint venture that no investor controls assesses its own qualification, and franchisors are not grouped with franchisees unless they are also their parent.

Transport, industrial processes, buildings, and any other purpose not within those three.

Regulation 25C requires at least one energy intensity ratio for each purpose that uses energy, expressed in kWh per unit of an activity indicator such as floor area for buildings or tonne miles for freight.

Seven: the Association of Energy Engineers, CIBSE, Elmhurst Energy Systems, the Energy Institute, the Energy Managers Association, the Institute of Sustainability and Environmental Professionals, and Quidos.

The Institution of Chemical Engineers was removed on 16 February 2026 and Stroma Certification on 20 February 2025.

PAS 51215:2014 is the BSI specification for the competence of a lead energy assessor, and regulation 12 of the ESOS Regulations names it as the standard approved registers apply.

BSI lists the 2014 PAS as withdrawn since 7 February 2025, but the regulation still governs for ESOS.

PAS 51215-1 and -2:2025 cover a combined energy and decarbonisation assessment and are voluntary.

Regulation 10(2) requires publication within six months of the compliance date or of the filing, whichever is later.

The Environment Agency’s Phase 4 guidance gives 10 June 2028 as the publication date for the fourth compliance period.

Phase 4 publishes the combined kWh saving achieved, but not per-measure savings or the action plan review.

The second post-implementation review, dated 18 July 2025, recommended “Keep” and no major changes, citing an incomplete evidence base, with a commissioned evaluation to report in 2026.

It recorded provisional Phase 3 data: 9,871 groups believed to qualify, 8,581 notifications and 5,403 action plans.

The regulator for the participant’s registered office: the Environment Agency in England, Natural Resources Wales, SEPA, the Northern Ireland Environment Agency, or the Secretary of State for offshore activities.

After the compliance date a regulator may select a participant for a compliance check and ask for evidence of how it complied, which is why the evidence pack must be kept.

Usually not.

The Environment Agency’s Phase 4 guidance counts employees, owners or managers and partners, defines an employee as someone on a contract of service whatever their hours, and says agency workers usually do not count, while advising that their contracts be checked.

Yes.

The Environment Agency’s Phase 4 guidance says that if you later discover the information you submitted was inaccurate, you must email esos@environment-agency.gov.uk for advice on how to correct it.

Revised submissions are published within six months of receipt.

Yes.

ESOS applies across England, Wales, Scotland and Northern Ireland, and SI 2026/701 extends to all four.

The regulator follows the registered office: SEPA in Scotland and the Northern Ireland Environment Agency in Northern Ireland, while the Environment Agency administers the scheme UK-wide.

It can carry out an assessment on ESOS lines, but MESOS does not accept submissions from voluntary participants.

The Environment Agency’s guidance suggests publishing the results in the organisation’s own reports or website instead.

ESOS began as the UK’s implementation of Article 8 of the EU Energy Efficiency Directive, which is why its first financial thresholds were in euros.

The thresholds were restated in sterling for qualification dates from 31 December 2020, and the 2026 amendments were made under the Energy Act 2023, which is the current power.

Nothing has been legislated.

The Phase 5 dates are published: qualification on 31 December 2030 and compliance by 5 December 2031.

The government says DESNZ intends to consult on SECR and ESOS later in 2026.

Participants may already include net zero considerations voluntarily using PAS 51215-1 and -2:2025, though MESOS cannot accept a voluntary decarbonisation assessment.