Government issues update on ESOS Phase 4 and 5

In its latest newsletter, the Environment Agency has outlined some important changes to ESOS Phase 4 (the current phase) and Phase 5 (2027 – 2031): 

1. Mandatory ESOS net zero requirements will be delayed to Phase 5…

The government had previously announced its intention to align ESOS Phase 4 audits with net zero.

Following delays to the introduction of Phase 3 legislation and guidance, and to give sufficient time for such a major change to ESOS, the new government has decided to postpone the introduction of net zero requirements until Phase 5 (2027-2031).

2. …but there will be a voluntary net zero reporting option in Phase 4

The Department of Energy Security and Net Zero (DESNZ) says it recognises that some ESOS participants may already be carrying out work that covers some of the elements of a net zero assessment.

DESNZ has worked with the British Standards Institution (BSI) to finalise PAS standards, which can be used on a voluntary basis for ESOS compliance in Phase 4. The following two standards will be published on 7 February 2025:

• PAS 51215-1:2025 Energy and decarbonization assessment – Part 1: Process – Specification. This standard describes the process for carrying out a combined energy and decarbonisation assessment in a single process to produce an implementation plan for achieving net zero across the scope and boundaries of the assessment; and

• PAS 51215-2:2025 Energy and decarbonization assessment – Part 2: Competencies of lead assessors and assessment teams – Specification. This standard updates the previous PAS 51215:2014 by strengthening the existing energy competencies that assessors need and incorporating new ones for GHG and net zero.

3. Qualification criteria remain unchanged for Phase 4

Proposed changes to qualification thresholds for ESOS to align with Streamlined Energy and Carbon Reporting (SECR) requirements will also not be taken forward in Phase 4. DESNZ says that any changes to qualification thresholds will be addressed as part of ongoing work to consider ESOS’s role within the wider business energy and emissions reporting landscape.

The Phase 4 qualification criteria and the qualification date (31 December 2026) will therefore remain unchanged.

4. Smaller Phase 4 changes

Some changes proposed for Phase 4 are still intended to go ahead, subject to parliamentary time and scrutiny. These are:

ESOS Phase 4 deadline

The Phase 4 deadline remains the same: 5^th December 2027. We can expect to see full Phase 4 government guidance in early 2027.

In the meantime, organisations in scope should be working on their Phase 3 ESOS Action Plan; the deadline is 5^th March 2025.

Advice and support

For advice on ESOS, including Phase 4 changes and the upcoming Action Plan deadline, get in touch with one of Sustainable Energy First’s ESOS Lead Assessors via the contact form below.