The Energy Savings Opportunities Scheme, known as ESOS, is a mandatory energy assessment for large and mid-sized UK companies. ESOS was introduced in 2014 to create an opportunity for businesses to identify cost-effective actions to save energy and thereby reduce carbon emissions with the help of a qualified ESOS Lead Assessor. The Department for Energy Security and Net Zero estimate ESOS will save businesses £1.12 billion on their energy bills.
Our qualified ESOS Lead Assessor, Eleanor Akers, worked with independent pharmacy wholesaler Sigma Pharmaceuticals (Sigma) to understand how energy was being used across their business and identify energy saving opportunities. The resulting ESOS Audit report was submitted to the Environment Agency, ensuring Sigma complied with the requirements of ESOS Phase 3.
The first step in an ESOS Audit is to build energy profiles across the business over a 12 month period, called the “reference period”. We built these for Sigma using data from utility and fuel bills and half-hourly electricity meter data where available. We worked closely with Sigma’s Sustainability Lead, Kirit Shah to ensure that we captured all of the energy used by Sigma’s warehouses, offices and retail facilities.
Gas and electricity used by Sigma’s offices and warehouses showed expected seasonal variations. More gas was used in the winter months than the summer months as Sigma predominantly uses gas for heating. Buildings fitted with air conditioning units showed lowest usage in the spring and autumn months where neither heating nor cooling was needed.
ESOS requires businesses to create energy intensity metrics to allow energy usage to be compared across buildings and operations. In Sigma’s case, energy consumed by each building was compared using kWh/m3. This metric was chosen as many of Sigma’s buildings are warehouses with high ceilings.
Initially, it was believed that the majority of energy usage at Sigma was in buildings. However, the creation of the energy profile revealed that diesel used by Sigma’s delivery fleet accounted for almost three quarters of the total energy used by Sigma.
For many businesses, the energy used by vehicles is less intuitively understood than energy used by processes or buildings. This is because gas and electricity bills generally show consumption in kWh whereas fuel is typically billed volumetrically.
Once energy profiles had been created, Eleanor combined an analysis of these with observations from site visits to identify opportunities to save energy at Sigma. It was estimated that Sigma could reduce their energy consumption by almost 4%, saving £35,500/year by combating phantom power.
Phantom power is energy consumed by items not in use. For example, heating an unoccupied building over the weekend or leaving computer equipment on all night. The potential savings were estimated by comparing the energy consumption profiles over the course of the average week to reported shift patterns. This comparison revealed that equipment was being left on when buildings were not in use.
It was recommended that Sigma eliminate phantom power by documenting and sharing best energy management practices across the organisation. It was also recommended that they consider installing building energy management systems to centrally control heating and cooling.
Sigma operates a mixture of diesel and electric forklift trucks, all of which are leased. The ESOS Audit estimated that the monthly operating costs of the electric forklift trucks were over £100 cheaper than the diesel forklift trucks. This saving is driven by the increased efficiency of forklift truck motors.
Today, Sigma’s existing electric forklift trucks are powered by grid electricity which is generated miles away from the point of use. As electricity is moved across the country, up to 10% is lost as it passes through cables and transformers. These losses could be eliminated by charging forklift trucks with electricity generated from rooftop solar. As well as reducing energy usage and emissions, solar powered forklift trucks would have zero operating costs.
These recommendations were presented in the ESOS Audit report and reviewed by Sigma’s leadership team. The true value in an ESOS Audit is starting conversations about the actions that can be taken to save energy, to reduce both costs and emissions.
ESOS Phase 3 ended in 2024 and we’re already in Phase 4! If you missed the Phase 3 deadline, you’ve likely been served an Enforcement Notice by the Environment Agency. To minimise the chance of being fined, it is vital that you appoint an ESOS Lead Assessor as quickly as possible.
To comply with Phase 4, companies must submit an ESOS Phase 4 Assessment by December 5th, 2027. Just as in Phase 3, you will need to create energy profiles over a 12 month reference period, submit energy intensity metrics and estimate the impact of energy saving measures implemented in the previous four years. IEC can help you prepare for ESOS Phase 4 by putting an energy monitoring strategy in place and helping you implement energy saving measures.
If you would like to work with our qualified ESOS Lead Assessors to respond to an Enforcement Notice or prepare for Phase 4, e-mail info@innovative-energy.org, with the subject line “ESOS” and we’ll get back to you within two business days.
If your organisation does not need to comply with ESOS, but you’d still like to understand what opportunities you have to reduce your energy consumption and increase your sustainability, we offer Energy and Sustainability Audits. To find out more about how these can create value for your business e-mail info@innovative-energy.org with the subject line “Energy and Sustainability Audit”.
Find out how we helped Sigma Pharmaceuticals uncover hidden energy savings opportunities and comply with ESOS Phase 3.
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