Efficient Energy Management Starts With Quality Data
Tom Anderton explains why his company puts quality data at the heart of their digital energy management solutions - and so should you. Anderton writes, utility costs...
Read Full ArticleWhen it comes to energy and emissions reporting, there are ways to streamline both the work and cost involved in being compliant.
TEAM Energy, who helps organisations achieve their net-zero ambitions and deliver compliance, explains how combining The Energy Savings Opportunity Scheme (ESOS) and Streamlined Energy and Carbon Reporting Scheme (SECR) can help businesses save money.
The ESOS and SECR have become part of the regulatory landscape since coming into force in 2014 and 2019, respectively. These separate schemes are both mandatory for large businesses that meet the scope, but many may not realise that some parts of the compliance overlap. This means that companies who split out their ESOS and SECR are missing the opportunity to streamline both the work and cost involved in meeting the compliance.
ESOS is a mandatory piece of EU legislation requiring large companies to submit an energy report to the Environment Agency every four years. An ESOS report analyses a company's energy data over a 12-month consecutive period. As of yet, there is no requirement to record emissions.
SECR is a mandatory UK government framework that, in part, replaced the Carbon Reduction Commitment (CRC) Energy Efficiency Scheme in April 2019. Its aim was to simplify the reporting process for companies and reduce emissions by requiring businesses to calculate and report on their energy usage and greenhouse gas emissions.
"Because ESOS spans a four-year cycle, it can often be left to the last minute. In our experience, companies who do this run the risk of missing the compliance deadline and gaining a financial penalty. We encourage companies to start their ESOS as much as they can, as soon as they can."
At the most basic level, the difference between ESOS and SECR is what they measure; ESOS examines energy use, while SECR focuses on a company's emissions.
ESOS requires businesses in scope to identify opportunities for improving their energy efficiency and list these in their report. However, SECR requires businesses to report on what actions they have taken during the reporting year to cut energy use and emissions but does not expect them to mention any planned or possible future actions.
There are roughly 11,000 businesses considered "large undertakings", that fall into scope for ESOS, in the UK. This means companies that either employ 250 or more people or have an annual turnover above £44 million and a balance over £38 million. This is larger than the size threshold for SECR, which has roughly 14,000 businesses in scope. SECR affects three types of UK organisations: Companies listed on a stock exchange; Companies that qualify as Large (using the definition in the Companies Act) and Limited liability partnerships (LLPs) that qualify as large.
ESOS does apply to overseas companies if they have a UK-registered establishment with 250 or more employees, however, SECR does not apply to organisations that are not registered in the UK.
Both schemes have been designed to help businesses. ESOS helps raise awareness of energy consumption issues, and ensures that your company is running as energy efficiently as possible. This has two significant benefits; helping to reduce your carbon emissions and lower your energy bills.
SECR aims to bring the benefits of carbon and energy reporting to more businesses. The reporting framework is intended to encourage the implementation of energy efficiency measures, with both economic and environmental benefits, supporting companies in cutting costs and improving productivity at the same time as reducing carbon emissions.
It is easy to assume that with all the differences between ESOS and SECR that each should be undertaken separately, however, the principles of collecting, processing and understanding the data is the same.
So, if your business is in scope to comply with both, here are a few reasons why it is smart to combine them:
Picture: a graphic showing a laptop with graphs on the screen. Image Credit: PX Fuel
Article written by TEAM Energy | Published 05 May 2022
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