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Are we ready for ESOS Phase 2?

Category: Business

Date: 14.09.2017

Time: 09.29

The charity PECT is currently leading delivery of a three year long energy efficiency project with the acronym BEECP, a project part-funded by the European Regional Development Fund (ERDF), completing in June 2019.

The Business Energy Efficiency Cambridge & Peterborough programme (BEECP) aims to provide support and grants to small businesses to help catalyse investment in energy efficiency initiatives, to reduce carbon emissions and realise the associated business benefits including; reduced operating costs, increased competitiveness, business growth and resilience, in some respects a small scale Energy Savings Opportunity Scheme (ESOS) for small and medium sized enterprises (SMEs).

Why do I say possibly not ready for ESOS Phase two? As a Lead Assessor who took part in Phase one, a lot of participants did not feel that the process added value to the business, most likely due to the additional cost of paying for the survey, however the odd few companies saw the cost savings that could be made.

In its first few months alone, the BEECP project has worked with nearly 50 different companies, and the company size has ranged from micro SMEs with three members of staff to companies employing up to 240 staff, and from office based to car engine manufacturers. To date the total potential savings identified have been 3,085,152 kWh of energy, 939 tonnes of CO2e with potential cost savings of over £274,000.

So far the project has found that just under a third of companies have significant energy consumption on the night tariff, mostly when the business is closed for the night, and the amount of consumption has varied from 16% to as high as 33%.

The stats so far indicate that the SME market best practice has the night consumption or “vampire load” of around 8% so far, the next best consumption is on or around 16% which has been average except for the extreme that spans between 20% to 33%.

The main thought that springs to my mind is that a large number of ESOS qualifying companies will have individual sites operating as independent entities, much the same as the SME companies that we have worked with so far. Assuming that a large entity has 10 separate sites, that is a potential for £59K of savings based on simple changes.

That being said, a lot of large entities do have excellent energy control, however an equal amount do not. A comment to the ESOS qualifying companies however, do they monitor all external site energy consumption, do they report on energy spend, do they measure or monitor their energy use?

I believe energy prices are set to rise significantly, and the continuity of energy supply should most certainly be considered questionable, with the Hinckley C reactor now £1.5 Billion over budget and reported to be 15 months late with expectations to be ready for 2027, with the last coal fired power stations planned to be closed by 2025, and a delay in the build programme for gas power stations. Energy prices are not going to fall anytime soon.

Considering all of this the BEECP project on the other hand is offering a free service to businesses in the Greater Cambridge & Greater Peterborough Local Enterprise Partnership area to improve resource efficiency. The really big difference between BEECP and qualifying for ESOS is that the BEECP project can offer Capital Grants to qualifying businesses.

The main thing to consider from this piece is difficult times are coming, it’s time to tighten the belt, simple checks and changes with a reasonable investment can result in significant reductions in normal operations for big or small companies.

As a company will you grab the opportunity and push change forward? Are you ready to make a change? To register your interest in BEECP and to find out more, visit www.beecp.co.uk.

Warren Pope is a Senior Business Advisor at PECT.

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