ESOS Phase 4: What Businesses Need to Know

ESOS Phase 4 is approaching, and recent government changes mean businesses should start preparing now.

For organisations within scope, Phase 4 brings some important changes around compliance, reporting and demonstrating progress.

First, what is ESOS?

The Energy Savings Opportunity Scheme (ESOS) is a mandatory energy assessment scheme for qualifying large UK organisations.

It requires businesses to assess their energy use, identify opportunities to improve efficiency and report their compliance to the Environment Agency.

The aim is to help organisations understand where they can make meaningful improvements to energy performance and reduce consumption.

Who qualifies?

ESOS generally applies to UK organisations with:

• 250 or more employees, or
• Turnover above £44 million and a balance sheet total above £38 million

Corporate groups also need to be considered, as one qualifying UK undertaking can bring other UK entities into scope.

What’s changing for Phase 4?

The 2026 amendments introduce several changes businesses should be aware of.

DECs and Green Deal Assessments

From Phase 4, Display Energy Certificates (DECs) and Green Deal Assessments (GDAs) will no longer be available as compliance routes.

Businesses will therefore need to consider the remaining compliance options, including ESOS energy audits and ISO 50001 where applicable.

Reporting energy savings

Phase 4 will also put greater focus on what happens after opportunities have been identified.

Businesses will need to report the energy savings achieved from implemented measures, making accurate energy data and record keeping increasingly important.

It’s no longer just about identifying opportunities

Phase 4 also puts greater emphasis on what happens after energy-saving opportunities have been identified.

Businesses will need to report the energy savings achieved during the compliance period, including the measures implemented and the estimated savings delivered by each measure.

This makes accurate energy data and good record keeping increasingly important.

What about measures that weren’t implemented?

Where measures included in a previous ESOS action plan haven’t been taken forward, businesses will need to explain why.

This means ESOS is becoming more focused on demonstrating progress rather than simply identifying opportunities.

Key dates

5th December 2026 – Phase 3 second progress update

31st December 2026 – Phase 4 qualification date

5th December 2027 – Phase 4 compliance deadline

What should businesses be doing now?

There’s no need to wait until the compliance deadline. Businesses can start by:

• Checking whether they qualify
• Reviewing their group structure
• Gathering and validating energy data
• Reviewing their previous ESOS action plan
• Recording implemented measures and savings
• Considering their Phase 4 compliance route

How GLEG Can Help

At GLEG, we believe ESOS should be more than a compliance exercise.

We support businesses with qualification assessments, energy data, audits, progress updates and Phase 4 compliance, while helping identify practical opportunities to improve energy efficiency and reduce costs.

If you’re unsure what the latest ESOS changes mean for your organisation, now is a good time to start the conversation.

Contact the GLEG team at hello@gleg.co.uk to discuss your ESOS requirements.

If you’re unsure what the latest ESOS changes mean for your organisation, now is a good time to start the conversation.

📩 Contact the GLEG team at hello@gleg.co.uk to discuss your ESOS requirements.