Will Brexit be the death of ESOS?
With the UK government currently negotiating our Brexit withdrawal, many people are asking how it may affect ESOS. Although it is currently preserved in UK law, there is no concrete evidence to say it will remain should we leave the EU, so if it’s set to become superfluous should we even bother complying?
ESOS introduced in 2015, is the Energy Saving Opportunities Scheme (ESOS) part of the Energy Efficiency Directive from the European Union. It is the UK element of the Environment Agency’s plan and was brought in to encourage large businesses to become more sustainable by recognising and reducing carbon based fuel. To qualify you must have -
- Over 250 employees or more
- A turnover greater than £42.5m
- Or a balance sheet greater than £36.5m
If you fall into this bracket you are required to undertake assessments every 4 years to identify cost-effective energy saving measures on supplies to buildings, industrial processes and transport.
Simon Smith CEO of BrightSourced Energy says:
“Well first and foremost the Brexit transition period goes beyond the ESOS deadline for Phase 2, so qualifying businesses will still need to adhere to compliance prior to December 2019. Failure to do so can result in hefty fines anywhere between £5,000 to an eye watering £90,000. Coupled with the embarrassment of your business being named and shamed, now is not the time to stall. We will have to see what happens after Phase 2, but we will have another 4 years to work that out anyway.”
Another problem organisations have in achieving compliance for the 2019 deadline, is since Phase 1 in 2015, many qualified ESOS assessors have not kept up their accreditation, mainly due to the cost of it and the fact their services are redundant between the 4 year phases, as well as the uncertainty as to whether the scheme will continue post Brexit. Therefore for Phase 2, there are now only around 250 registered and qualified lead assessors to choose from that are registered with the approved professional bodies.
“For Phase One, there were circa 350 qualified assessors, to manage over 7,000 UK businesses who qualified for the scheme. This led to too much work for the resource available and as it got closer to deadline, some businesses were having to pay ridiculous day rates to get their reports completed on time. For Phase 2, there are more businesses that need to qualify and less assessors available, my advice is get your report done sooner than later, as there is just over 12 month left to achieve compliance”
So it would seem whether the death of ESOS will happen post Brexit is unclear. However what is certain, is that it has already had an impact on the number of qualified people available to help businesses comply with Phase 2; so it’s inevitable that costs will go up and there may be a problem with organisations being able to complete their reports on time, due to lack of resource. So acting early is the key, whether you are waiting to see the what the impact of Brexit on ESOS has or not.
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ABOUT BRIGHTSOURCED ENERGY
BrightSourced was founded in 2012 by leading procurement veterans, with the aim of helping businesses and organisations maximise the benefits of integrating procurement strategies, technology, market intelligence and purchasing expertise into their existing operations.
Since that time we have worked with some of the largest businesses in the world, including many FORTUNE 500 & FTSE 250 companies, managing a spend portfolio worth over £2 billion.
In 2017 BrightSourced acquired The Utility Forum ltd to add energy to our portfolio of services and in 2018 we merged with Bank Brokers, an international business head quartered in Oslo, Norway, to help our customers reduce their commercial banking costs.
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