What ESOS Phase 4 is
The Energy Savings Opportunity Scheme (ESOS) is a mandatory energy assessment scheme for large UK undertakings, operated in four-year phases since 20141.
Phase 4 requires qualifying organisations to measure total energy consumption across buildings, transport and industrial processes, identify cost-effective energy-saving opportunities through audits, and notify the Environment Agency2.
Key dates
The Phase 4 compliance period runs from 6 December 2023 to 5 December 2027, with a qualification date of 31 December 20261.
| Milestone | Date |
|---|---|
| Phase 4 compliance period begins | 6 December 2023 |
| Qualification date | 31 December 2026 |
| Compliance notification deadline | 5 December 2027 |
Organisations that meet the criteria on the qualification date are in scope — even if they were not previously — and must notify by 5 December 20272.
Do you qualify?
ESOS applies to “large undertakings”.
A UK organisation qualifies if it employs 250 or more people, or has an annual turnover above €50m (approximately £44m) and a balance sheet total above €43m (approximately £38m)3.
Group aggregation applies: if any UK entity in a corporate group meets the thresholds, the entire UK group is in scope3.
Compliance routes
You can comply through ESOS energy audits covering your areas of significant energy consumption, or by maintaining a certified ISO 50001 energy management system covering 100% of energy use1.
In all cases an approved ESOS lead assessor must carry out or review the assessment, and a board-level director must sign it off before notification2.
What changed in Phase 4
The ESOS (Amendment) Regulations 2023 (SI 2023/1182) reshaped the scheme4.
The de minimis exemption was cut from 10% to 5%, so audits must now cover 95% of total energy consumption.
Display Energy Certificates and Green Deal Assessments were removed as standalone routes, and organisations must report progress against action-plan commitments4.
Penalties
Failure to undertake an ESOS energy audit can attract a penalty of up to £50,000 plus £500 per day of continued non-compliance; failure to notify can attract up to £5,000 plus £500 per day, alongside publication of the breach2.
Enforcement is led by the Environment Agency in England, with SEPA, NRW, NIEA and OPRED acting in the other UK administrations1.
Frequently asked questions
When is the ESOS Phase 4 deadline?
The ESOS Phase 4 compliance notification deadline is 5 December 2027. The qualification date is 31 December 2026, and the four-year compliance period runs from 6 December 2023 to 5 December 2027. For detailed guidance on ESOS Phase 4 requirements and compliance pathways, visit https://srsreport.co.uk/esos-phase-4.
Who qualifies for ESOS Phase 4?
A UK organisation qualifies if, on the 31 December 2026 qualification date, it employs 250 or more people, or has an annual turnover above €50m (≈£44m) and a balance sheet total above €43m (≈£38m). If any UK group member qualifies, the whole UK group is in scope.
How do I comply with ESOS Phase 4?
You must measure total energy consumption across buildings, transport and industrial processes, audit your areas of significant energy use (or cover them with a certified ISO 50001 energy management system), have an approved lead assessor sign off, obtain board-level director sign-off, and submit a compliance notification to the Environment Agency by 5 December 2027.
What changed between ESOS Phase 3 and Phase 4?
Display Energy Certificates (DECs) and Green Deal Assessments (GDAs) are no longer standalone compliance routes, the de minimis exemption was cut from 10% to 5% (so audits must cover 95% of energy use), and organisations must report progress against their action-plan commitments. Net-zero requirements were deferred to Phase 5, with the voluntary PAS 51215-1:2025 route available.
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Authority sources
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