ESOS Phase 3 – What’s on the horizon?

ESOS energy saving

It’s that time again when large companies should be thinking about ESOS – the Energy Saving Opportunities Scheme. We’re well into Phase 3 of ESOS, with the final compliance deadline in December 2023.


The results of the government’s consultation on improving ESOS last year have only recently published so they’ve left it too late to make any significant changes during Phase 3. It’s in Phase 4 (2024-2027) that companies will need to amend approaches to energy efficiency and carbon management… however it’s always best business practice to start sooner rather than later.


There are a few changes for Phase 3, the main ones being:

  • Reducing the de minimis energy (that can be excluded from audit) from 10% to 5%.
  • Tracking performance or efficiency with an energy metric (e.g kWh per £m turnover, kWh per mile travelled or kWh per unit of production).
  • Reporting on actions taken since the last ESOS report and more detailed plans for next steps.
  • Additional data will be included in the compliance notification.


It’s in Phase 4 (2024-2027) that more significant changes will come in, including:

  • ESOS recommendations are likely to be aligned with Net Zero ambitions – a new standard on Net Zero reporting will be created to help. This may also need to consider climate change adaptation and resilience.
  • ESOS targets or action plans should be published. There may be a requirement to report annually on progress against targets.
  • The financial qualification thresholds will be reduced slightly – the criteria are one of the following 250 staff, £36m turnover or £18m balance sheet.
  • Low energy users (under 40,000 kWh) are likely to be excluded.
  • The use of DECs (Display Energy Certificates) will no longer be valid.
  • The qualification date will be brought forward to reduce the rush for compliance in the year up to the deadline.


ESOS – What you need to do now

  • Gather all your energy data – electricity, gas, fuels and business travel by road.
  • Appoint your Lead ESOS Assessor
  • Get started soon on your energy audits – the sooner you do these the better, particularly with the soaring price of energy at the moment.

As a registered Lead ESOS Assessor, my systems approach to ESOS makes sure you meet the requirements of Phase 3 and prepare well for Phase 4 … all the time giving you recommendations that are useful to your business.

It’s best to get started as soon as possible – please do get in touch so we can plan your next steps or download the factsheet below.


Eshcon Factsheet - ESOS - Energy Savings Opportunity Scheme


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