Mandatory energy surveys for all large businesses

The Government has recently issued its response to last year's consultation on the Energy Savings Opportunity Scheme (ESOS), together with regulations to enact the scheme and guidance for participants.  ESOS is being introduced as a result of Article 8(4) of the EU Energy Efficiency Directive which requires all non-SMEs to conduct energy audits by 5 December 2015 and every four years thereafter.  The official estimate, based on affected businesses reducing their energy consumption by a modest 0.7%, is that the net benefit to the UK over 16 years will be £1.6 billion.

Who is affected

ESOS applies to the private sector only.  Your business will have to comply if it is an undertaking carrying out business activity in the UK and at least one of the following applies:

•       It has 250 or more staff;
•       It has fewer than 250 staff but has an annual turnover exceeding €50m and a balance sheet exceeding €43m; or
•       It is part of a corporate group which includes an undertaking that meets either of the above criteria.

The timetable

ESOS runs in four year phases - any business/group that meets the above criteria on the qualification date for each phase has to participate in that phase.  The qualification date for Phase 1 is 31 December this year and participants have until fulfil their obligations by 5 December 2015.   All private sector organisations should therefore consider their size and group structure as at the end of this year and then, if they fall within the scope of ESOS, take steps to comply with the new requirements by the deadline.

ESOS obligations

There are four main obligations.  In each phase ESOS participants must:

• ·         Measure all their energy use for a continuous twelve month period;
• ·         Conduct audits covering all their main areas of energy consumption;
• ·         Report the fact that they have complied with the above by the compliance date; and
• ·         Maintain an ESOS evidence pack providing a full record of their compliance.

So far as it is reasonably practicable, an energy audit report must provide recommendations for any cost-effective energy efficiency measures that can be undertaken, and quantify the estimated costs

  

and benefits. There is no compulsion on the business to implement the recommendations but a director or equivalent has to confirm that they have been considered.

ESOS audits have to be (at the least) reviewed by a lead assessor whose name appears on an approved register indicating that he/she is suitably qualified and experienced.  An in-house lead assessor can be used, if available.  The BSI has just published a Publicly Available Specification on the competence of lead energy assessors.

There are alternative routes to compliance which will be relevant, in some circumstances, for businesses that operate certified energy management systems, or have had Green Deal assessments carried out, or Display Energy Certificates issued.  Also, ESOS-compliant audits that have been conducted since 6 December 2011 will count towards the Phase 1 requirements, so it may not be necessary to audit all of a business's main areas of energy consumption between now and December 2015.

Similarities with CRC

Many of the rules of ESOS bear some similarity with the CRC Energy Efficiency Scheme, which also runs in phases with a qualification date for each phase, but there are important differences.  This is particularly the case in the detailed rules concerning joint ventures, trusts, foreign-owned companies and group disaggregation.  Two important differences that will affect many ESOS participants are that transport energy usage has to be included, but landlords will be pleased to hear that they are not responsible under ESOS for metered supplies to their tenants. 

What this means

The Government expects that 9,400 large enterprises will have to comply with ESOS.  Many of these will already be carrying out regular energy audits across the key areas of their business, recognising that improving energy efficiency makes financial sense even in sectors that are not energy-intensive.  For these companies, the burden of compliance should not be too great.  The remainder have until early December next year to do what is necessary.  A good first step is to determine the boundary of the ESOS participant organisation by examining its corporate structure and then gather energy data for a 12 month period, remembering that the rules are different from those applying to the CRC scheme.  A tool such as Sustainability Sure is invaluable for such a task, and it will facilitate sharing the data with the ESOS assessor when the time comes too. 

Find out more about Sustainability Sure by contacting 

+44 (0)844 245 9958 or email sustainabilitysure@landmark.co.uk.

Landmark shortlisted at the New Energy & Cleantech Awards 2014

We are delighted to confirm that Landmark Information Group has been shortlisted for ‘New Energy Champion’, at the New Energy & Cleantech Awards 2014. The event will be held in London on Wednesday 30th April 2014, where the winners will be announced.

Now in its seventh year, the New Energy & Cleantech Awards recognise those who play a pivotal role in the process and shaping of the future green energy and cleantech industries: companies, entrepreneurs, investors and specialist advisers. Landmark Information Group has been nominated as a result of the work it has done in creating and launching the new Sustainability Sure service, which is an all-in-one carbon, energy and sustainability solution for corporate organisations and public bodies.

This awards ceremony is renowned for attracting more than 300 CEOs, FDs, entrepreneurs, advisers, venture capitalists and financiers, and prides itself on bringing the City and business sectors together in a dynamic and exciting environment.

David Mole, Business Development Director at Landmark said: “To be nominated for an industry award for Sustainability Sure by our peers is a great achievement and we are pleased to have been shortlisted in the New Energy & Cleantech Awards. We look forward to hearing the outcome at the end of April at the planned ceremony.”

http://www.newenergyawards.com/

Climate change - meeting the compliance challenge

Despite the Government's well-publicised Red Tape Challenge, the volume of climate change-inspired legislation seems to keep on growing.  Businesses, and in some cases public sector organisations too, may already:

·      be subject to compulsory carbon trading schemes (the EU Emissions Trading System, the CRC Energy Efficiency Scheme)

·       be required to meet stringent energy targets in order to benefit from lower energy prices (Climate Change Agreements)

·       have to pay for Energy Performance Certificates and Display Energy Certificates for their buildings

·       be obliged to operate a formal energy management system as a condition of their environmental permit. 

 

Now, UK quoted companies must in addition report annually on their greenhouse gas emissions.  This new requirement extends to certain public bodies too, while others are strongly encouraged to report.  From next year, another new piece of legislation will make regular energy efficiency audits obligatory for all enterprises above SME level.

 
While such obligations may prove beneficial for some organisations through tighter control of energy consumption, high energy intensity businesses tend to manage their energy well in any case - when it is a large proportion of your overall costs, you have to or you become uncompetitive.  Whether large or small, the raft of carbon management legislative requirements presents a compliance headache, particularly for those operations that are subject to a number of the overlapping regimes.  The problem is magnified for companies that are part of an international group because the parent company may need to report worldwide emissions in several jurisdictions, based on differing legislation, emission factors and reporting guidelines.  Such groups will often wish to make voluntary reports as well, and engage in CSR, in a way that is appropriate in each country. 

How can an organisation keep track of all these requirements?  Better still, how can it go beyond mere compliance and make use of the data it is required to gather to increase efficiency and demonstrate its environmental credentials to its stakeholders?  Fortunately, the software tools are now available to meet these challenges and turn the burden of complying with multiple climate change regimes into an opportunity for performance improvements and reduced costs.

Landmark's Sustainability Sure package has been developed to help both large and small organisations to manage their energy and environmental data and facilitate reporting.  It is flexible and customisable, allowing the user to record, analyse and manage all energy/carbon compliance issues through a single application, no matter where the operations are in the world, and deal with other CSR and sustainability issues too.  It is supremely easy to use, with a web-based interface accessible through any browser.  The displays and outputs can be tailored to suit the organisation and the user's preferences, and alerts set to inform the appropriate people when particular events occur (or don’t occur). 

One of the key features of Sustainability Sure, and the main reason why many organisations use it, is CRC compliance.  It is well suited to the task of tracking energy usage across a large property portfolio.  Anomalies such as missing or inconsistent meter readings can easily be spotted, and supporting information such as bills or notes of organisational changes and property disposals can be uploaded to provide a full evidence pack.  A unique feature is Quick Connect which provides automatic receipt of data from energy suppliers and metering companies, reducing the chance of errors creeping in and ensuring the consumption figures are available quickly.

For those businesses that participate in multiple schemes, whether UK-only or worldwide, an important benefit of Sustainability Sure is that data only has to be entered once even if it is used in several ways.  For example, the consumption figures from a single meter can feed automatically into the CRC report, the UK greenhouse gas report, voluntary reporting under the Carbon Disclosure Project and any other outputs that may be required.  Emissions factors are automatically updated, a big advantage for those working across several jurisdictions with their different reporting obligations.  Users can be confident that their reporting will be compliant with both local legislative requirements and global standards.  The system can handle CSR data such as waste generation and workforce diversity as well as energy consumption and emissions, allowing everything to be managed and controlled through one tool.

 
Having gathered a substantial quantity of energy data, it would be a shame not to make proper use of it.  The Energy Dashboard within Sustainability Sure allows users to drill down through the data and analyse it in different ways (including graphically) to identify potential savings.  This process can be as simple or sophisticated as the users wishes.  For example, the energy manager of a large manufacturing group might start by ranking sites in descending order of energy intensity and then focus attention on the consumption of the top 10%.  Half-hourly meter data can be examined at whatever scale is required.  An unexpectedly high overnight gas consumption in single-shift production facility would merit investigation, as would a gradual increase in electricity demand over a period of months.  The impact of changes such as the installation of renewable electricity generation is readily identifiable, making it easier to justify similar investments in the future. 

Most of the schemes to which organisations are subject, whether mandatory or voluntary, have auditing requirements.  In the case of the CRC only about 20% of participants will be audited each year and, as a result, the need to maintain 'audit-ready' records is often forgotten.  This can lead to mild panic when a communication is received to warn of an impending audit.  Users of Sustainability Sure need have no fears because the system is designed to facilitate the audit process.  Remote or on-site auditor access can be provided easily, without compromising the security of other data, and all the supporting references will be available through the system.  This makes both internal and external auditing a simple procedure even across a large number of sites.

 

Using an effective management tool such as Sustainability Sure allows an organisation to reap the benefits of climate change legislation as well as ensuring that compliance is achieved and can be demonstrated. 

 

Victoria Joy