UK government’s review of the Energy Savings Opportunity Scheme - how can your business help shape its future?

The UK government has published its 2025 post implementation review of the Energy Savings Opportunity Scheme (ESOS) Regulations 2014. ESOS is a mandatory energy assessment scheme for organisations that, on 31 December 2022:

• Employed 250 or more people, or
• Had an annual turnover in excess of £44 million, and an annual balance sheet total in excess of £38 million

As we reported last month, the Environment Agency (EA) has been issuing legal enforcement notices and warnings of proposed penalties to organisations who they believe qualify for ESOS but have not notified their compliance. Organisations qualifying for ESOS must achieve compliance or they could face a penalty of up to £50,000.

In this article, we outline the review's recommendations and highlight how businesses can shape ESOS.

The review’s recommendations and your opportunity to shape ESOS

The review recommends that no major changes be made to the ESOS regulations until the conclusion of a full evaluation of the scheme in May 2026. 

In particular, the evaluation will seek to assess:

• The costs to businesses of complying with ESOS, including the additional costs introduced in phase 3, such as the requirement to publicly disclose more data.
• The extent to which phase 3 has led to the introduction of energy saving measures that otherwise would not have occurred, and how this compares to the findings from the evaluation of phase 1. In particular, whether the added stringency and reporting requirements of phase 3 have led to more effective recommendations for businesses and greater impetus to implement such recommendations.
• The extent to which measures implemented due to phase 3 have actually led to reduced energy consumption and the extent to which this has reduced carbon emissions. For instance, has the implementation of behavioural measures actually reduced energy consumption?
• The extent to which measures taken in response to historic phases continue to yield energy savings.
• Any unintended consequences, such as reputational benefits for businesses in reporting additional data.

The forthcoming evaluation of ESOS is an opportunity for businesses to make representations to government, on their experience of the scheme. 

How can Ashfords help you make representations to the UK government?

We supported the Environmental Services Association on its response to the UK Emissions Trading Scheme Authority on proposals to expand the scheme to include energy from waste, including on what the potential implications of the expansion of the UK Emissions Trading Scheme might mean for the recycling and waste management sector.

Paul Collins is an environmental lawyer. He worked for the EA for over a decade until 2024, acting as the lead lawyer for the EA enforcing ESOS and other climate change regimes. He represented the EA in more than 150 appeals against civil penalties, in the First-tier Tribunal and the Upper Tribunal. Therefore he's uniquely well placed to advise clients in relation to regime compliance, steps to take in response to enforcement action, and prospects of success when making representations/bringing appeals. 

If you would like to discuss this, please contact Paul Collins.