What is ESOS and who qualifies?
The Energy Savings Opportunity Scheme requires large UK organisations to carry out energy audits of their buildings, transport, and industrial processes every four years. You qualify if your organisation employs 250 or more people, or has an annual turnover exceeding £44 million and a balance sheet exceeding £38 million.
Phase 4 covers the period from 6 December 2023 to 5 December 2027. The compliance deadline — the date by which your ESOS assessment must be complete and notified to the Environment Agency — is 5 December 2027.
What's changed in Phase 4
Phase 4 introduces several significant changes compared to previous cycles:
Mandatory Action Plans — organisations must now produce an Energy Saving Opportunity Report (ESOR) and an Action Plan identifying specific energy saving measures. Simply completing the audit and filing is no longer sufficient.
Annual Progress Reports (APRs) — from 2024 onwards, qualifying organisations must submit annual progress reports to the Environment Agency confirming progress against their Action Plan.
Energy intensity ratios — mandatory energy intensity metrics must be reported, allowing year-on-year performance tracking.
Board-level sign-off — a director or equivalent must sign off the ESOS assessment, confirming board-level awareness and accountability for energy performance.
The 95% coverage rule
ESOS requires that your assessment covers at least 95% of your organisation's total energy consumption across buildings, transport, and industrial processes. Getting the energy profile right — identifying which sites, vehicles, and processes fall within scope — is the first and most important step.
Organisations with complex property portfolios or multi-site transport fleets often underestimate the scoping exercise. A poorly scoped assessment risks non-compliance even if the audits themselves are technically sound.
Engaging a Lead Assessor
All ESOS assessments must be reviewed and signed off by an approved Lead Assessor — an individual accredited by a recognised professional body. The Lead Assessor takes responsibility for the technical quality of the assessment and signs the notification to the Environment Agency.
The lesson from Phase 3 is clear — Lead Assessors become fully booked in the months before the deadline. Organisations that left engagement until late 2027 in Phase 3 faced significant difficulties finding available assessors and risk non-compliance through no fault of their own.
Phase 4 deadline is 5 December 2027. We recommend beginning your scoping and Lead Assessor engagement no later than Q1 2027 — and ideally in 2026 if your estate is complex.
Building energy audits under BS EN 16247-1
Building energy audits carried out for ESOS must comply with BS EN 16247-1 (general requirements) and BS EN 16247-2 (buildings). This sets minimum requirements for the audit process, including site visits, data collection, identification of energy saving opportunities, and report format.
For large commercial property portfolios, building audits are typically the highest energy consumption category and therefore the most critical to get right.
What to do now
Start with an energy profile — a consolidated view of your organisation's energy consumption across all buildings, vehicles, and processes for the 12-month reference period. This tells you your total consumption, which sites are in scope, and where the 95% coverage boundary falls.
NZC Consultants provides ESOS Lead Assessor services including building energy audits, transport audits, energy profiles, Action Plans, APRs, and director sign-off packs. Get in touch to discuss your Phase 4 requirements.