British manufacturers face significant penalties after admitting they are unprepared for ESOS

• Despite the fact that 60% of manufacturers have  conducted their own energy efficiency assessments in the past, 49% of British manufacturers say they aren’t aware of the Energy Saving Opportunity Scheme (ESOS) and 69%  feel uninformed about the requirements for carrying out an ESOS assessment
• As a result they face fines of up to £50,000 for non-compliance with the mandatory Government policy, which is designed to help businesses achieve greater savings on their energy bills
• npower Business Solutions is calling on the Government and energy suppliers to make a stronger business case for manufacturers to do more on energy efficiency

Despite the recent implementation of the Government’s ESOS legislation, new research from npower Business Solutions shows that British manufacturers are both unaware of and underprepared for the ESOS assessments scheduled to take place this year. The findings demonstrate that although the policy is designed to help large organisations cut their energy use, 49% of manufacturing businesses stated they were unaware of the scheme, while 45% reported being unprepared for the first of the Government’s assessments which are due by December 2015.

npower spoke to over 100 decision makers at manufacturing businesses across the UK about how they manage their energy use and the extent to which they are prepared for ESOS. The overwhelming majority (62%) are already investing in energy efficiency, and a similar proportion (60%) said they have already conducted their own assessment of their company’s energy use in the past three years. Despite this, and with less than a year until the first assessments, 69% of respondents do not feel well informed about the requirements for carrying out an ESOS assessment.

Wayne Mitchell, head of npower Business Solutions, said: “ESOS may seem like another policy that just brings more costs for manufacturers, but we see it as a significant opportunity to reduce the pressure on your bottom line. Energy is one of the least optimised costs in a business and yet through implementing simple efficiency measures, the average business could reduce consumption by 20%, with a big impact on what you pay for your gas and electricity.

“Nevertheless there are significant shortcomings in the way the policy has been communicated and will be implemented. I strongly believe that if we want to encourage the business community to embrace energy efficiency then we must do a better job of making the case for it to do so.

“I’m disappointed that the ESOS legislation includes a financial penalty for those that do not comply with its requirements, and yet doesn’t make it mandatory for businesses to implement any of the energy saving recommendations that these assessments will produce. As a result I fear the policy could prove to be something of a white-elephant, its potency significantly weakened by the fact manufacturers will see it more as a paper exercise rather than an opportunity to change their relationship with energy consumption.”

Gareth Stace, head of climate and environment at EEF, the manufacturers’ organisation:  “For many manufacturers that have been concentrating on energy efficiency for some time, the scheme will function as a regular ‘stock taking exercise’ ensuring that momentum is retained and new energy efficient measures are highlighted and taken when possible. For others, the ESOS requirements provide the impetus to map out an energy efficiency strategy from scratch, highlighting the most cost effective measures to be taken and where considerable savings can be made. With energy prices, most notably electricity, set to rise significantly in the coming years, energy efficiency measures remain the most effective and proactive way manufacturers can manage and minimise these increasing costs.”

To read the unedited version of this news item visit npower’s website here.