At the end of last month, the Department of Energy and Climate Change (DECC) published a new ‘practical guide’ for ESOS compliance. This arrived shortly after the release of the Environment Agency’s (EA) mandatory guidance. We are now nine months post-ESOS launch and with less than one percent of affected companies compliant, what does this imply?
More ESOS guidance, sir?
At a glance, the guide looks suspiciously familiar to the mandatory guidance but closer examination reveals some significant differences centred on formal (EA) versus practical (DECC) guidance. The mandatory EA document outlines who is applicable and what they need to do, whereas the new DECC guide gives supplementary advice on how to actually do it – to become compliant within the ESOS framework. The latter is not mandatory and was developed in response to feedback from organisations finding it difficult to comply.
In assuming that the reader is already clued up on ESOS, the guide tackles potential practical stumbling blocks (identified through ESOS workshops and engagement with businesses) on the road to compliance, including handling missing consumption data, choosing the right data sources and sample size to use as well as dealing with senior management and stakeholders. Many of the issues brought up are ones that we at Sustain have been urging businesses to consider. We applaud the regulators in identifying the ‘teething’ problems with ESOS and this document shows their intention to further simplify the scheme.
On the whole, it is clear that the relevance and efficacy of the guide is commendable and is indeed a step in the right direction for ESOS.
SOS for ESOS
ESOS is halfway through its lifecycle. The number of compliant companies is scarce (less than fifteen*) and time is beginning to run out for the vast amount of companies left to take action. If it’s not a matter of awareness – and a recent EDIE survey has outlined that businesses are well aware of the scheme, (82 percent of respondents, in comparison to 38 percent who have taken action) – then why are businesses so slow on the uptake?
Well, one of the reasons is perhaps the scope of information provided. DECC have already stated that the preceding information has been insufficient and so companies needing to get compliant have, arguably, been left stranded in the regulatory waters. Additionally, ESOS has perhaps not been showcased as the opportunity it can be, leaving many companies hesitant to take action. Accompanied with the run up to the general election and the end of the financial year, these could contribute to the low numbers of ESOS compliant notifications.
In order to combat this, the regulators need to continue to provide concise information and cohesive guidance to allow businesses and organisations to comply, but it is a two way process. In order for ESOS to be effective, businesses must take the necessary steps towards compliance – either by taking the reins themselves or through working with an established energy compliance partner.
Although seemingly disconcerting at first, the publication of this extra guidance is a good development for ESOS. It shows measured steps by the regulators to dissolve the confusion that exists around the scheme and is no reason to panic for those affected by ESOS.
The bottom line
ESOS won’t go away – it is part of a large scale EU Efficiency Directive (2012/27/EU) and needs to be upheld and enforced by the UK regulators. Admittedly, ensuring ESOS compliance is not easy and requires both excellent project management and co-operation throughout the businesses it affects. But it is still possible to get compliant in time for the fast approaching 5th December deadline.
Well, get compliant. It needn’t be an arduous task and can actually provide significant cost reductions (as well as avoiding the hefty fines). Those organisations who are pro-active in embracing ESOS compliance, are using it either to mandate their intentions to improve their energy performance or as a platform to start positive change towards sustainable business practices. Focus on the O of ESOS and your business will benefit.
*Source: Environment Agency, 20th April
Department of Energy & Climate Change, 2015. Approaches to ESOS Audits, s.l.: Department of Energy & Climate Change.