ESOS Compliance - Getting Started in 2015

For many large organisations, the task for ESOS compliance will be written into their work objectives and targets for the year. To be fair, there are more examples of badly developed and written energy policies, objectives, targets and action plans than there are good ones! These are some examples:

• “The company will comply with ESOS by 5 Dec 2015”.
• “My company will reduce our carbon emissions by 100% in 10 years”.
• “We will reduce our energy consumption by 15% in one year”.

Eight items to get ESOS underway

The following eight steps are key to ensuring businesses make the right considerations before setting ESOS compliance objectives. Addressing energy issues gives the business a cost effective way of meeting compliance and getting value from energy savings. Otherwise, the business may risk setting themselves up for failure.

Decide if you need to comply with ESOS. ESOS compliance is mandatory for large UK based private sector organisations. The term ‘Large’ includes companies with 250 or more employees or a turnover of annual turnover ≥ €50m, or balance sheet ≥ €43m. For businesses that are part of a group, each UK-based business has to assess if it too is classed as large, using the same definition. If any of the UK based business units are large, the whole group would need to comply with ESOS. An organogram for the business, employee numbers, and balance sheet and turnover figures are handy.

Determine the scope of your ESOS assessment. This should include energy consumption in buildings, processes and transport. A minimum of 90% of the total is to be covered by an energy assessment. An energy breakdown such as one shown in Figure 1 can help businesses to determine which 90% to pick.

Choose your compliance route. ESOS provides four means for businesses to comply with ESOS: ISO 50001 certified energy management system, Display Energy Certificate (DEC) with accompanying report, Green Deal Assessment, and energy audits. There are a few tips and hints that are crucial for ensuring everyone can achieve compliance in a timely manner and avoid penalty fees. (1) Each of the compliance routes require varied amounts of resources and offer varying returns on investment. (2) There are a limited number of competent persons to help with each of the approved routes for all businesses. As such, businesses will inevitably be using a mix of compliance routes and should book any external support required sooner rather than later to avoid disappointment.

Select an in-house or external lead energy assessor. There are many pros and cons of using in-house energy assessors. The same is also true for externally-sourced lead energy assessors. There may be elements within the business that internal personnel have a better knowledge and understanding of than external personnel, e.g. part of the operating conditions, information that has implications on energy but is also commercially sensitive. Internal personnel may understand the people and top management better. In these businesses, it is beneficial to use internal lead energy assessors and contract energy audits to external suppliers.

NQA can offer a range of energy management training courses to assist in-house assessors. They are also able to link companies up with a register of approved energy management consultants, on top of providing first class external assessors for certification to ISO 50001.

Gain the commitment of your senior management. Senior management need to know and buy in to what is expected from them. Few senior managers are aware of energy regulations and their fiduciary duties. Take a moment to explain to them what ESOS is, the energy assessment plan, timelines, and anticipate organisational and informational roadblocks, and general methods to disarm them. It is also an opportune time to book their time for reviews and final sign off. Getting commitment and buy in early helps to facilitate a smooth energy assessment process.

Set compliance targets that are realistic and achievable, with detailed action plans behind them. ESOS compliance actions needs to be backed up with real and defined tasks or action plans. What are the key steps in each task? How much does it cost? What is the schedule? Have the project risks been identified? Have they been agreed? Is there room for contingencies or slack in the plan? Make sure each task is essential and contributes toward achieving ESOS compliance.

Delegate the task to a group of employees. Although the lead assessor is responsible for the energy assessment, the business is responsible for ESOS compliance. Instead of the traditional one-person responsibility, using the detailed action plan, divide the tasks into smaller chunks and delegate them out to a team. Once you know who your key players are, get these items planned in. In a more “formal” organisation, this could be formalised during the performance appraisal. In other organisations, resources may have to be agreed in advance with plenty of notice.

Regularly monitor and provide feedback. Feedback should be provided to the business and also to senior management. Verbal updates on progress can be a good way of giving and gaining feedback. Feedback can also be a platform for prompting the need to talk to someone to organise specific things, or to gain specific advice from the business. Regular feedback makes senior managers feel involved in ESOS and can better facilitate the uptake of energy saving recommendations.

Following these simple steps, you’ll have a simple and effective plan, engaged with the right people, integrated into the organisation and measurable to the management of the company. Hopefully, it will help you avoid the “because ...” and “but ...” conversations at the end of 2015.

InTouch Readers can book free advisory visits with NQA energy management system assessors today to ensure they have all the required support to achieve ESOS compliance in advance of the first compliance deadline on the 5th December 2015. To secure your appointment simply call the team today on 0800 052 2424.

Kit Oung is an experienced energy manager at Energy Efficien:ology, board member of the Energy Managers’ Association, and Advisory member of 2degrees Network. He is the author of Energy Management in Business: The Manager’s Guide to Maximising and Sustaining Energy Reduction (Gower) and Energy Audits: The Key to Delivering Real Energy Reduction (BSI).