ESOS Phase 4: What Businesses Need to Know
ESOS Phase 4 Guide: Eligibility, Deadline & Key Changes for UK Business
The Energy Savings Opportunity Scheme (ESOS) Phase 4 officially began on 6 December 2023 and will conclude with the ESOS Phase 4 compliance deadline of 5 December 2027.
If you're wondering whether your organisation needs to comply, what has changed since Phase 3, or how to prepare before the deadline, this guide explains everything UK businesses need to know about ESOS Phase 4 eligibility, reporting requirements and compliance.
What is ESOS Phase 4?
The Energy Savings Opportunity Scheme (ESOS) is the UK government's mandatory energy assessment scheme for large organisations. It requires qualifying businesses to assess their energy use, identify opportunities to improve energy efficiency and report their findings to the Environment Agency.
ESOS Phase 4 builds on the changes introduced in Phase 3 by placing greater emphasis on demonstrating progress, implementing energy-saving opportunities and increasing transparency around energy management.
Organisations are required to submit their compliance notification by 5 December 2027.
Who is eligible for ESOS Phase 4?
The ESOS Phase 4 eligibility criteria remain largely unchanged from Phase 3.
Your organisation must participate if, on the qualification date of 31 December 2026, it qualifies as a large undertaking and meets all of the following criteria:
- Is based and registered in the UK.
- Employs 250 or more people.
- Has an annual turnover exceeding £44 million.
- Has an annual balance sheet total exceeding £38 million.
If your business crosses these thresholds by 31 December 2026, you will be required to comply with ESOS Phase 4, even if you were not previously required to participate.
If your organisation qualified during Phase 3 but no longer meets the eligibility criteria, you must submit a Do Not Qualify (DNQ) notification through the Environment Agency's MESOS portal.
If you're unsure whether your organisation qualifies, our team can help determine your ESOS Phase 4 eligibility and explain your compliance obligations.
What is the ESOS Phase 4 deadline?
The main ESOS Phase 4 deadline is 5 December 2027 – Compliance notification submission deadline.
However, there are several important dates businesses should be aware of throughout the compliance period.
ESOS Phase 4 key dates
- 5 December 2025 – Phase 3 Progress Report 1 deadline
- 5 December 2026 – Phase 3 Progress Report 2 deadline
- 31 December 2026 – ESOS Phase 4 qualification date
- 5 December 2027 – ESOS Phase 4 compliance notification deadline
What are the key changes in ESOS Phase 4?
Several important updates have been introduced for ESOS Phase 4, continuing the government's focus on delivering measurable energy savings rather than simply completing energy audits.
1. Action Plan progress reporting is now integrated
Organisations must now include progress against their Action Plan within their ESOS assessment.
If any planned energy-saving measures have not been completed, businesses will need to explain why they have not been implemented.
This provides greater accountability and demonstrates ongoing commitment to improving energy efficiency.
2. Display Energy Certificates (DECs) and Green Deal Assessments (GDAs) are no longer accepted
Previous compliance routes using Display Energy Certificates (DECs) and Green Deal Assessments (GDAs) have been removed.
Businesses must now use the remaining approved compliance routes when completing their ESOS assessment.
3. Voluntary net zero reporting
Although net zero reporting is not yet mandatory under ESOS Phase 4, organisations can voluntarily adopt PAS 51215 to report on energy performance and decarbonisation activities.
Doing so can help businesses prepare for likely future requirements in ESOS Phase 5, while supporting wider sustainability and ESG objectives.
Why should businesses prepare early for ESOS Phase 4?
Although the ESOS Phase 4 deadline is not until 5 December 2027, organisations should begin preparing well in advance.
Early preparation provides several benefits:
- Improve data quality by collecting accurate energy consumption data across all sites and operations.
- Identify energy-saving opportunities early, including lighting upgrades, heating optimisation and operational improvements.
- Allow time for board approval, which is required for your Action Plan.
- Spread implementation costs over a longer period rather than making last-minute investments.
- Reduce compliance risks by avoiding delays and ensuring all reporting requirements are met.
Starting early also gives organisations more time to implement recommended efficiency measures, potentially reducing energy costs before the reporting deadline.
What happens if you don't comply with ESOS Phase 4?
Failure to comply with ESOS can result in significant financial penalties.
Businesses may face fines of up to £50,000, with additional penalties of up to £800 per day for continued non-compliance.
Preparing well before the ESOS Phase 4 deadline helps minimise these risks while ensuring your organisation remains fully compliant.
How can SeeMore Energy help?
Navigating ESOS Phase 4 can be complex, particularly with the introduction of enhanced Action Plan reporting and updated compliance requirements.
Our experienced consultants can help your organisation to confirm your ESOS Phase 4 eligibility, complete compliant ESOS assessments, develop and review Action Plans, identify practical energy-saving opportunities, prepare compliance notifications, and meet every ESOS Phase 4 reporting requirement with confidence.
Whether you're preparing for your first ESOS assessment or continuing from Phase 3, our specialists can provide expert guidance throughout the compliance process.
Contact us today for a free consultation and discover how we can help your business achieve full ESOS Phase 4 compliance while identifying opportunities to reduce energy costs and support your long-term sustainability goals..
