Energy Savings Opportunity Scheme (ESOS) is a UK Government scheme that intends to reduce the UK’s overall impact on the environment by helping large organisations identify opportunities to improve energy efficiency and reduce carbon emissions. This is a mandatory activity for all businesses that meet the requirements, including certain charities and other not-for profit organisations. In this blog, we discuss whether charities qualify for ESOS and the steps required to comply.
So, does ESOS apply to charities? Yes, and let us tell you why.
Having a charitable status does not automatically exempt and organisation from compliance and if they meet the schemes qualification criteria then they must comply.
For ESOS Phase 4, an organisation generally qualifies if;
– it employs 250 people or more
– or has an annual turnover exceeding £44 million and an annual balance sheet total exceeding £38 million.
Whether your charity needs to comply will depend on its legal status, size and any relevant group arrangements and additional rules apply to certain other organisations.
ESOS is an essential step in reducing energy waste, improving energy consumption efficiency and minimising carbon emissions across the UK. To reiterate, an organisation qualifies if it meets both criteria above.
Regarding the definition of people employed this can include employees, owners, managers and partners. Additionally, if your charity is part of a corporate group, the groups size and structure must be considered.
Charity organisations are included within the scope of ESOS and are specifically outlined as not automatically exempt from ESOS compliance, eligibility depends on the applicable legal and qualification criteria.
For more information, please look at the official ESOS qualifications and compliance guidance or have a look at our ESOS page.
Where charities meet the requirements, you should establish which compliance requirements apply and plan your assessment accordingly. The ESOS assessment process may involve an energy audit of energy data, along with an energy consumption profile of your site. This should provide an accurate representation of how, why and where your charity consumes energy. Some charities will of course have higher and/or more consumption levels depending on their size and scale.
This can help your charity to identify opportunities to reduce energy waste, improve efficiency and lower operating costs.
ESOS compliance requirements have developed over successive phases. For the current phase 4 (2026), organisations should review the latest guidance on assessment requirements and reporting obligations.
Streamlined Energy and Carbon Reporting (SECR) is another scheme created to minimise impact on the environment and reduce business’ energy bills. This scheme requires certain organisations to report energy consumption and greenhouse gas emissions through their annual reporting. Like ESOS, charities are required to complete SECR if they fall into the relevant criteria.
For Large companies and LLPs the qualifying criteria generally requires at least two of the following:
Different requirements apply to quoted companies.
The thresholds do not automatically make every charity subject to SECR. The organisation must also fall within the relevant legal reporting categories.
For your charity to be compliant with SECR, you should establish which disclosures are required and put processes in place to collect accurate energy and emissions data.
Depending on the reporting category, the requirements may include:
Generally being pro-active regarding emissions allows the charity to collect reliable energy and emissions data which helps to meet reporting obligations while identifying opportunities to reduce consumption, improve efficiency and lower operating costs.
For more information about SECR compliance, check out our dedicated page.
Understanding whether your charity needs to comply with ESOS, SECR or both can help you plan, manage reporting responsibilities and identify opportunities to reduce energy costs.
Our free, no obligation review of your charity will allow us to advise the best course of action to save you money on ESOS and SECR. As the input data is similar for both ESOS and SECR, if you do have to comply with both, Boxfish have developed significant cost efficiencies that can be unlocked if we contract for both at the same time.
Contact us today to start swimming against the tide!