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ESOS could cut energy costs by fifth

Research into the Government’s Energy Savings Opportunity Scheme (ESOS) for large organisations shows that participating companies could save an average of 20 per cent through energy efficiency measures.

Research into the Government’s Energy Savings Opportunity Scheme (ESOS) for large organisations shows that participating companies could save an average of 20 per cent through energy efficiency measures.

Under the ESOS initiative, all large organisations in the UK must conduct a full energy efficiency audit of their operations every four years, with the first deadline having officially passed in January 2016

The Government hopes the scheme will help cut average energy use in large businesses by 5 per cent by identifying energy efficiency opportunities. This would be equivalent to collective annual cost savings of around £250 million across nearly 10,000 organisations. 

Estimated savings

However, the Carbon Trust has suggested that the actual savings achieved on the back of the scheme could be far higher.

Using an analysis of 86 ESOS audits it carried out ahead of the first deadline, the Carbon Trust estimates that the average cost reduction that could be made per business is 20 per cent.

With the average annual energy bill of participating organisations estimated to be £1.8 million, this means that the average cost reduction per business could be as much as £360,000.

Opportunity breakdown

According to the Carbon Trust, the most common recommendations for manufacturers were energy efficient lighting, energy metering and heating, ventilation and air conditioning (HVAC). Other common opportunities included improvements to steam systems, compressed air, motor efficiency and motor control.

In office-based organisations, HVAC improvements were the main recommendation.

Meanwhile, companies in the construction sector, which had the highest average level of energy spend, were typically recommended energy management, lighting, heating and metering measures. 

Transport costs

One interesting observation made by the Carbon Trust was that most businesses outside the transport and logistics sector were not closely monitoring vehicle energy consumption, even though on average it accounted for nearly a third of overall energy costs.  

Typical recommendations for reducing transport costs included improvements to vehicle procurement and replacement and training programmes to help monitor and reduce vehicle mileage and fuel consumption. 

First-timers

David Tobin, energy consultant at the Carbon Trust, said the scheme had encouraged many companies to investigate energy management deeply for the first time.

“It has cast a wider net than some other schemes and required real action in businesses to understand their energy use”, he said.

“But the real proof of success will be in the rates of actual implementation. We would encourage all ESOS participants to make the most of having to undergo a compliance process and realise the significant cost savings on offer.”

A practical guide to help ESOS participants act on the opportunities identified during their audits can be found here. The Government has also produced a separate energy efficiency guide to help smaller companies that are not subject to ESOS requirements.