Parliament approves ESOS legislation

Following the extension of the ESOS deadline to 5th June 2024 earlier this year, Parliament has now approved a number of changes which affect both ESOS Phase 3 and the incoming Phase 4 compliance. The legislation was passed on 7th November 2023 and will come into play on the 29th November.

What ESOS legislation has been passed?

The changes mainly stiffen up the commitments ESOS-qualifying organisations must do to ensure compliance. This shifts ESOS to be a much more proactive requirement. In total, there are five changes which have now been ratified by law:

Net Zero will become part of ESOS audits

ESOS reports will now provide organisations with much more guidance on how to work towards net zero, aligning ESOS directly with the Uk government's 2050 net zero target. This will be voluntary for ESOS Phase 3 but will become mandatory for ESOS Phase 4.

The de-minimis rules have changed

The previous ESOS stipulations allowed more leeway through the de minimis rules with 10% of an organisation's Total Energy Consumption (TEC) being exempted from the survey. This has now changed to 5%, meaning a larger percentage of your TEC must be analysed. Comparing the data collected to the equivalent from ESOS Phase 1 and 2 (if the organisation qualified) is now also required alongside several increased data requirements we outlined in our previous ESOS Phase 3 changes article.

Reporting and targeting will be required in ESOS Phase 4

From 5th December 2024, ESOS qualifying organisations will need to set targets on their reduction strategy or deliver a formal carbon reduction plan. There will need to be annual reporting on the progress of these targets.

ESOS data must be disclosed publically

Again from Phase 4 onwards and to promote greater transparency, ESOS data collected will need to be disclosed publically with performance measured against the above reduction targets. This can either be done through the Streamlined Energy and Carbon Reporting (SECR) standards or through the ESOS web portal. Although this may be daunting for organisations, increased transparency can deliver some advantages (something we have outlined in our previous article 7 advantages of carbon reporting software).

Audits will now feature more standardisation

There will be an increase in the standardisation of factors across reports, including the reason for ESOS qualification, TEC, ESOS lead assessor details and more.