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Understanding ESOS
Thursday 16 April 2015
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Welcome and Introduction
Keelin McCone
Programme Manager
ARENA Network
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RSPB
Lisa McAnally
Visitor Experience Officer
Belfast WOW (Window on Wildlife)
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BITC -Business in the Community NI
RSPB’s WOW, Airport Road West, Belfast
Thursday 16th April2015
Understanding ESOS
the
Energy Savings Opportunity Scheme(ESOS)
Judith Wilson [NIEA ESOS Lead]
Hugh McGinn
What is ESOS?
• Energy Savings Opportunity Scheme (ESOS)
– New UK regulation to comply with Article 8 (4) of
the European Energy Efficiency Directive.
– Requires all large undertakings in the UK to do
energy efficiency audits and notify the
Environment Agency by 5 December 2015 that
they have complied.
– and thereafter to do the same at least once every
four years.
ESOS Vision
• The scheme is estimated to lead to £1.6bn net benefits to the
UK.
• The majority of these being directly felt by businesses as a
result of energy savings.
• Improved air quality in the UK.
• Stimulate the market for manufacturers and installers of
energy efficiency equipment.
• Reduction in traded CO2 allowances.
As an energy manager
what do I have to do?
Simple:
1. Determine if you are in the scheme
2. Measure your total energy consumption
3. Conduct energy audits to identify cost-effective energy
efficiency recommendations.
4. Report compliance to the Environment Agency (as the
scheme administrator).
Or, is it that easy?
Am I In?
What is a ‘large undertaking’?
• Large undertaking* in the UK is defined as:



at least 250 employees; or
an annual turnover in excess of €50 million (£38,937,777
million) and an annual balance sheet total €43m
(£33,486,489 million)
If your undertaking is part of a corporate group which
includes a large UK undertaking which meets the above
criteria you must participate in the scheme
• Phase 1: Based on your status on 31 December 2014
*An undertaking, as defined in the Companies Act 2006, is: a corporate body or partnership or an unincorporated
association carrying on a trade or business, with or without a view to profit
Qualification Criteria definitions
• An Employee : anyone with a contract of employment
regardless of hours [zero hour contracted staff are
included, as are F/T and P/T employees, manager, owner
or partner]
• Trade/Business type and amount of energy use is
irrelevant if the criteria of a large undertaking is met (as
per Section 1161(1) of the Companies Act 2006)- You are
in ESOS
• If you are subject (mandatorily) to the Public Contracting
Regulations 2006 you are excluded from ESOS.
Qualification Criteria definitions (cont)
•
•
•
To help determine if you are a large undertaking use last accounts submitted
to Companies House prior to 31/12/2014 to determine qualification as a Large
Undertaking
You may need to go further back if you are near / cross the threshold to get 2
consecutive years.
A is not required to participate, B is required to participate
UK Organisational structure and impact on
qualification for undertakings
For participation B and B1 would form one
participant (highest UK parent group), while C and
C1 would form another unless they agree to
aggregate.
A would not be required to participate because it is
not an undertaking in the UK.
Changes after qualification
• Changes to organisation size/structure etc after the
qualification date do not effect qualification. Once you are
in you are in.
• Any organisation / undertaking sold by a qualifying
organisation between 31 Dec 2014 and 5 Dec 2015 needs
to comply with ESOS (either with old owner, new owner or
on their own)
• Assets (not organisations) sold or acquired during period 31
Dec 2014 and 5 Dec 2015 do not need to be included in
total energy consumption calculation or be audited. But it
would be sensible to include them anyway.
I’m in - what am I required to do?
1.
Conduct ESOS assessment [Measure total energy consumption]
 Where not fully covered by ISO50001 certification
2.
Conduct energy audits
 Where not covered by ISO50001 certification, Green Deal coverage or
Display Energy Certificates (partial or full coverage)
3.
Identify energy savings opportunities
4.
Use a lead assessor to either do or sign off points 1 to 3 above (unless
fully covered by ISO50001)
5.
Get a director to sign off that they have seen the recommendations of
the work
6.
Notify the scheme administrator of ESOS compliance
1. Conduct an ESOS assessment
• Identify total energy consumption (buildings, installations,
transport)
– Total energy consumption data
•
•
•
•
12 months consecutive data covering 31/12/14 and end before compliance date 5/12/15
Supplies for all assets covering a specified 12 month period
Common units - can use £ or common energy unit (not CO2)
Purpose: To determine which assets will need to be covered by compliant audits or alternative
routes to compliance
• Identify 90% of your total energy consumption = ‘Areas of
Significant Energy Consumption
• Determine coverage by ISO50001, Green Deal, DECs, existing
audits which meet the ESOS criteria
• Determine additional ESOS audits that need to be undertaken
prior to 5/12/2015
Areas of significant energy consumption
• Flexibility about which energy is in the 90%
– Could exclude all of one fuel type; or
– Certain assets/activities; or
– A combination
In this example you could
Ignore A Service Ltd
Concentrate on Transport
Logistics
2. Conduct ESOS audit(s)
Compliant audits:
• Use 12 consecutive months’ verifiable data
–
12 months data starting from as far back as 6 Dec 2010
• Where 12 months data is not used or consumption profiling is not
undertaken justification must be provided
• Audits can have been undertaken between 6 Dec 2011 and 5 Dec
2015
• Assets don’t need to have been audited at the same time
• Analyse your energy consumption and energy efficiency
• Identify practicable ways in which you can improve your energy
efficiency
• Identify the estimated costs and benefits of the ‘energy saving
opportunities’ recommended
• Purpose - recommend cost effective ‘energy saving opportunities’
3. Identifying savings opportunities
from ESOS audits
• Use life cycle cost analysis [LCCA] to
determine cost effectiveness rather than
simple pay back period where possible
• Identify recommendations within your control
• No requirement in the regulations to
implement the identified savings
4. Lead assessor
• Your lead assessor can either:
– carry out your ESOS assessment and audits
themselves
– check that the assessment and audits done by people
who aren’t lead assessors meet the ESOS
requirements
• Lead assessor signs off the work but can use
analysis from others i.e. individuals can
undertake these activities and the lead assessor
can review them.
Lead assessors cont.
• Lead assessor is an individual that belongs to an approved
register
• Approved bodies and registers are on ESOS webpage
https://www.gov.uk/energy-savings-opportunity-schemeesos#approved-registers-of-lead-assessors (see last slide)
• Lead assessors can be internal or external
5. Director Sign off
• Show recommendations of the assessment to a board
level director
– 1 director if lead assessor is external
– 2 directors if lead assessor is internal
• Director confirms:
–
–
–
–
They have reviewed the findings
Organisation is within scope of the scheme
Organisation is compliant
Information provided in notification is correct
• No specific format required
6. Notifying the EA
• Online notification form accessed from ESOS
page on .gov.uk
• Notification questions are available in
Appendix B of the ESOS guidance
• Provide basic organisation details – not energy
data or improvements identified
• Needs to be submitted by 5 Dec 2015 to be
compliant.
Keeping an Evidence pack
• Cost Effective Energy Savings Opportunities Identified
• Details of your ESOS assessment and audits (where
applicable)
• Certifications for alternative compliance routes
• Details of any areas where you are not fully compliant
with the rules
• Record of your director(s) & lead assessors sign off
• Records to be kept for 12 years
Summary: Key Dates
• Qualification Date 31/12/14
– Do not need to register or tell the EA you qualify
• First Compliance Date 05/12/2015
– Tell the Environment Agency you have complied online
via .gov.uk webpage
https://www.gov.uk/energy-savings-opportunity-schemeesos#submit-your-esos-notification-of-compliance
• And every 4 years thereafter
Summary of Requirement for ESOS
Role of the NIEA
•
The Environment Agency
is the scheme administrator for the UK.
•
Northern Ireland Environment Agency
is the regulator for Northern Ireland based organisations.
We will check notifications for completeness, ie compliance criteria,
organisational structure, total emissions and 90% coverage calculations,
records, audits and recommendations, director sign off, lead assessor
registration.
Follow up organisations who have not notified EA that we believe should have
notified EA [We believe there are approximately 300 organisations in NI that
are potential participants out of about 9000 UK potential participants].
Issue information and enforcement notices
Issue Civil penalties
Non-compliance
Failure to notify
Civil penalties
ESOS Regulation
Regulation 43
Penalties
A fixed penalty of up to £5,000
An additional £500 for each working day starting on the day
after service of the penalty notice until the notification is
completed, subject to a maximum of 80 days
Publication
Failure to maintain records Regulation 44
A fixed penalty of up to £5,000
The cost to the compliance body for undertaking sufficient
auditing activity to confirm that an organisation has complied
with ESOS
Publication
The penalty notice may specify steps to remedy the breach
Failure to undertake an
energy audit
Regulation 45
A fixed penalty of up to £50,000
An additional £500 for each working day starting on the day
after service of the compliance notice, until the breach is
remedied, subject to a maximum of 80 days
Publication
The penalty notice may specify a requirement to undertake an ESOS
Assessment.
Failure to comply with a
compliance notice, an
enforcement notice or a
penalty notice
Regulation 46
A fixed penalty of up to £5,000
An additional £500 for each working day starting on the day
after service of the penalty notice, until the breach is remedied,
subject to a maximum of 80 days
Publication
False or misleading
statement
Regulation 47
A fixed penalty of up to £50,000
Publication
Further info/guidance
• EA ESOS WEBPAGE:
https://www.gov.uk/energy-savings-opportunity-scheme-esos
ESOS Guidance:
https://www.gov.uk/government/publications/comply-with-theenergy-savings-opportunity-scheme-esos
ESOS Regulations:
http://www.legislation.gov.uk/uksi/2014/1643/contents/made
ESOS Helpdesk
[email protected]
Approved registers of lead assessors: organisation and name of register
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•
•
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•
•
•
•
•
Association of Energy Engineers – certified energy auditor international CEA-I
Association of Energy Engineers – certified energy manager international (CEM-I)
CIBSE (The Chartered Institution of Building Services Engineers) – CIBSE low carbon
consultant (LCC) register, ESOS lead assessor subset
ECMK Limited - ECMK ESOS lead assessor register
Elmhurst Energy Systems – Elmhurst approved ESOS lead assessor
Energy Institute (EI) – chartered energy manager
Energy Institute (EI) – register of professional energy consultants (RPEC)
Institution of Chemical Engineers – register of chartered chemical engineers
(MIChemE/FIChemE) ESOS LEA
Institution of Environmental Sciences – IES lead energy assessor
National Energy Services Limited - National Energy Services ESOS register
Quidos – ESOSRegister.com
Stroma Certification Ltd – ESOS lead energy assessor certification
The Energy Managers Association – EMA energy saving opportunity scheme lead
assessor register
The Institute of Environmental Management and Assessment – environmental
auditor and full membership of IEMA (ESOS lead assessor subset)
The Institute of Environmental Management and Assessment – principal
environmental auditor (ESOS lead assessor subset)
Thank you
for your attention.
We will answer any queries during the
question and answer session.
Alternatively you can e-mail us directly
on [email protected]
Making Sense of ESOS
Robin Davey
Energy Management Consultant & Lead Assessor
RDEEM
Robin Davey
Energy Management Consultant & Lead Assessor
RDEEM
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Routes to compliance
•
•
•
•
•
•
ESOS Energy Audit
ISO 50001
DEC
ISO 14001
GDA (domestic)
GDA (non-domestic)
Note -
The energy usage information provided
must be within the compliant period
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Examples of scope and
boundaries of the audit
A multiple retail or office based organisation
• How many sites/branches have you? (list)
• Are they owned or leased?
(specify)
• Do you sublet any premises?
(specify)
• Have you clear and continuous records of energy usage for
each site? If not, can you explain why not?
• Will you include energy usage from tenants in your figures?
• Have you any pro bono agreements with tenants? (specify)
• Do you intend to include owned transport in your audit?
• Do you intend to include energy consumed by company
cars and grey fleet travel in your audit?
• What will you include in deminimus energy usage?
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Examples of scope and
boundaries of the audit (contd)
A manufacturing organisation
•
•
•
•
•
What factories, offices and enterprises are included? (list)
What sites are excluded and why?
Are you including transport?
(specify vehicles)
Does the company sublet part of its premises? (specify)
Have you 12 consecutive months of energy usage, electricity,
natural gas, oil or LPG recorded for each factory in £ & kWh,
litres or tonnes in the case of woodchip/wood pellet?
• Have you a list of the products manufactured in each factory?
• Are you including company cars or grey fleet vehicles?
• What are you excluding under the deminimus clause?
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Requirement/action
Participant
Lead
Assessor
Overall responsibility for compliance with ESOS
Yes
Appoint Lead Assessor
Yes
Highlight any audit work already undertaken
Yes
Agree audit methodology for new audits
Yes
Yes
Define scope of audits
Yes
Yes
Yes
Yes
Yes
Yes
Agree number of site visits required
Yes
Yes
Make data available for audit
Yes
Identify energy saving opportunities
Yes
Agree audit timetable
Agree sampling approach
Yes
Calculate energy/cost savings of measures identified (LCCA or another method, e.g. SPP)
Yes
Determine energy use profiles
Yes
Present audit(s) recommendations
Review overall ESOS Assessment
Yes
Obtain director(s)/senior managers sign off of audit(s) findings and recommendations
Yes
Notify the Scheme Administrator of compliance by the compliance date
Yes
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Maintain an ESOS Evidence Pack to substantiate the audit(s)
Yes
Yes
Yes
Yes
Key Points
Requirement/action
Company
Overall responsibility for compliance with ESOS
Yes
Appoint Lead Assessor
Yes
Agree number of site visits required
Yes
Review overall ESOS assessment
Yes
Yes
Obtain directors/senior managers sign of audits, findings and
recommendations
Yes
Notify the scheme administrator of compliance by the
compliance date
Yes
Maintain an ESOS evidence pack to substantiate the audit (s)
Yes
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Lead
assessor
Yes
Yes
Key Points
Requirement/action
Company
Overall responsibility for compliance with ESOS
Yes
Appoint Lead Assessor
Yes
Agree audit timetable
Yes
Agree number of site visits required
Lead
assessor
Yes
Yes
Make data available for audit
Yes
Review overall ESOS assessment
Yes
Yes
Obtain directors/senior managers sign off audit’s findings and
recommendations
Yes
Yes
Notify the scheme administrator of compliance by the
compliance date
Yes
Maintain an ESOS evidence pack to substantiate the audit (s)
Yes
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Yes
Timing
• Completion by November 2015
• It is now 16 April 2015
• The time taken for a completion from a well organised
company with no hitches is three months
• Only a handful of companies have submitted their
application for compliance to date
• The later you leave it, the more it will cost
• Start now! Appoint your lead assessor, start
compiling your energy records, and preparing your
evidence pack
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Cost (guidelines)
The cost will depend on the size, complexity and how well
prepared your company is.
Company led audits - Example 1
A medium sized company with one factory or office
complex, no subsidiaries or sizeable tenants, it is able to
provide:
• Clearly presented energy data for 12 consecutive
months preferably is spreadsheet format
• A basic planned energy improvement programme
A ball park cost £3,000 - £4,500
If the company has two similar factories or dual site
office complexes, this could increase by 15 % - 70%
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Company led audits (guidelines)
- Example 2
• A medium – large company with multiple offices or similar
subsidiary operations. It can provide:
• Clearly presented energy data for 12 consecutive months for
each site/operation. If applicable it will include transport and
travel energy usage/cost
• A good understanding of energy improvement initiatives with a
documented evidence of previous and planned improvements
A ball park cost £3,500 - £5,500
Approximately £900 - £1,250 for each additional site/operation
requiring a visit (all sites may not require visits)
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Bespoke audit (guidelines) Example 1
• A medium – large company with multiple offices or similar subsidiary
operations
• It has not collated energy information, when pressed for this it is
provided as incomplete copies of invoices which have to be checked
to see that they are relevant and complete by the lead assessors
organisation
• There is a minimal understanding of energy usage and costs
throughout the company
• There may be complexities and lack of knowledge in the ownership
and tenancy of the office or sites in use
A ball park estimate of £5,500 - £6,500 for the main site(s) and
£1,000 - £1,500 per additional site or operation analysed and
audited
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What you get for your money
An evidence* pack containing
• Verifiable energy data presented in hard copy and digital form (some
companies may refuse to accept third party data storage devices)
• A list of the sites/operations and evidence of those audited
• An action plan agreed for energy savings for the next 4 years
• Where applicable the energy saving initiatives will be costed using either
the simple payback method or life cycle cost analysis
*BITCNI will retain a digital copy of the information in
the evidence pack
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What you get for your money
(continued)
The evidence will be presented in board friendly report * that
includes:
• A summary of the audits and assessments carried out
• An action plan with a programme of energy saving initiatives
agreed between the company contact and lead assessor
• The projected potential total cost and annual savings in £,
energy in kWh and CO2 in tonnes
• A proposed programme for checking and recording progress of
energy saving initiatives over the next four years
* BITCNI will retain a digital copy of this report
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Key points
• The report must be signed by one company director
(If it is compiled by an internal lead assessor 2 directors)
• It is the company (not the lead assessor) who is responsible for
submitting the report for compliance
• The submission will be done on line, ideally this should be done
jointly by the company contact and lead assessor
• The chosen route(s) to compliance will be clearly identified
• It would be advisable to allow 1 month for checking and notification
by the environment agency after submission of the ESOS report
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Questions
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Thank You
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