ESOS Phase 4: what to do now

The Energy Savings Opportunity Scheme (ESOS) is in Phase 4. Jon Cranefield, Head of Responsible Consumption at Sustainable Energy First, explains what businesses should be doing at this point.

The ESOS Phase 4 deadline is 5 December 2027, which may feel like a long way off. But there are actions you can take now to reduce the load on your business as deadline day approaches.

Look for a lead assessor

It’s a smart idea to get your lead assessor booked in now, especially if you’ll be requiring them to carry out the energy audits themselves. Even if their role is limited to checking the work of your in-house team, it makes sense to appoint them well ahead of the ESOS Phase 4 deadline. Lead assessors get busier in the run-up to an ESOS deadline and you don’t want to risk not getting your compliance work signed off in time.

Sustainable Energy First has a qualified team who can handle the ESOS lead assessor role for your organisation.

Keep gathering data

Data collection should be ongoing, rather than something you do in bursts ahead of compliance deadlines. The more detail the better, so use sub-metering data to break down energy consumption by sites and processes.

As well as energy use, you should also be measuring energy intensity ratios. These are now a staple of both SECR and ESOS reporting. They’re important because they put energy use in the context of other metrics like productivity, floorspace or footfall. If your energy consumption rises 10% in a year, that could look like a step backwards – but if this happens in line with a 20% rise in output, it’s clear that your business is successfully implementing efficiency measures.

Check out Phase 4 changes

Phase 4 has a few different requirements from Phase 3. For example, your ESOS report now needs to give the energy savings from each individual measure, rather than an overall total. These changes were finalised in August 2026, so many businesses haven’t yet had a chance to familiarise themselves with the updated Phase 4 guidance. Taking the time to understand the changes will give you the best chance of achieving compliance.

Keep tracking Phase 3 progress

Phase 3 introduced two new ESOS compliance requirements:

• An Action Plan
• Two subsequent progress reports

If your business was in scope for Phase 3, you will have already have completed the plan and the first progress report. You’ll need to submit the second progress report by 5 December 2026.

The guidance suggests that you don’t do the report itself too far ahead of this deadline, but you should be assessing progress on a regular basis anyway. This is a great opportunity for honest internal discussions and tough questions.

• If we didn’t achieve everything in the Action Plan, what didn’t get done?
• What were the barriers to carrying out all the measures in the Action Plan?
• If we achieved it all, how could the next plan be more ambitious?
• How much money has the business saved through energy-saving measures?
• What were the big wins?
• Where did we really mess up?

(Answering the first two questions is now a mandatory part of the reporting process since the new rules for ESOS Phase 4 came in.)

Not everything from your internal discussions has to make it into the official progress reports. But asking the hard questions sets you up to create a much more effective Action Plan in Phase 4.

When to start on ESOS Phase 4

The first step is the energy audit, whether you do that in-house or hire a lead assessor. This must be based on 12 months’ energy data. The 12-month reference period for your total energy consumption has to:

• Include the qualification date (31 December 2026)
• End before the final ESOS Phase 4 deadline (5 December 2027)

This means you have to start your 12-month reference period on or before 5 December 2026. 

The bigger your organisation is, the more resources and time the energy audit will take, especially if you’re doing the bulk of the work in-house. Even if you hire a lead assessor for the audit, you still need to work with them to provide the information they need. So it makes sense to start on your Phase 4 energy audit as soon as possible.

What is the qualification date?

The qualification date for ESOS Phase 4 is 31 December 2026. The Energy Savings Opportunity Scheme (ESOS) is mandatory for businesses big enough to count as a “large undertaking” on that date.

The vast majority of businesses that were in scope of Phase 3 will also be in scope of Phase 4, so there’s no need to wait until the qualification date to start working on compliance.

However, if your business has changed a lot in size recently or is close to the qualification threshold, it’s worth double-checking. The “large undertaking” status isn’t just about the size of the business on the qualification date – it’s also about how long the business has been that size.

If your business has recently shrunk below the ESOS qualification threshold but was “a large undertaking” for two consecutive accounting periods in the lead-up to 31 December, it will still count as large for the purposes of ESOS.

We explain more in our ESOS FAQs and we’re always on hand to offer expert advice.

Key dates

Getting expert help

At Sustainable Energy First, we have been supporting large organisations with their ESOS obligations since the scheme began over a decade ago. We’re seeing calls about ESOS Phase 4 compliance ramp up as the qualification date approaches, and we expect to get many more enquiries in the coming months.

We can take on the lead assessor role for you, or just advise your organisation on its methodology. For a no-obligation chat, get in touch today.