THE NQA ESOS COUNTDOWN WEBINAR 5 DEC 2014 – 1 YEAR TO COMPLIANCE

Agenda

ESOS Qualifying Criteria, Compliance Requirements and Timelines - Jo Scully, ESOS Project Manager at Environment Agency

Compliance through ISO 50001: Northern Rail Case Study - Richard Walsh, ISO 50001 Assessor, NQA

Can ISO 50001 be achieved within a year? - Kit Oung, Board Member of Energy Managers Association

Q&A

Jo Scully, ESOS Project Manager, EA

Jo will provide a summary of the ESOS scheme and go into further detail on elements of the qualification criteria and compliance requirements that the Environment Agency have had queries about via the ESOS helpdesk.

Energy Savings Opportunity Scheme Jo Scully – Environment Agency ESOS Project Manager

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What is ESOS? Energy Savings Opportunity Scheme (ESOS)

New UK regulation to comply with Article 8 (4) of the European Energy Efficiency Directive. Requires all large undertakings in the UK to do energy efficiency audits by 5 December 2015 and thereafter at least once every four years.

It is likely to cover over ~10,000 UK

organisations

Key Dates Qualification Date 31/12/14

Don’t need to register or tell us you qualify Compliance Date 05/12/2015

Tell us you have complied online via webpage And every 4 years thereafter

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What are ‘large undertakings’? Large undertaking is UK organisation that has: at least 250 employees; or an annual turnover in excess of €50 million

(~£39.2 million) and an annual balance sheet total €43m (~£33.7 million)

Is part of a corporate group which includes a UK undertaking which meets the above criteria

Phase 1: Based on status on 31 Dec’ 2014

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Requirements 1. Conduct ESOS assessment Where not fully covered by ISO50001 certification

2. Conduct energy audits Where not covered by ISO50001 certification, Green Deal

coverage or Display Energy Certificates (partial or full coverage)

3. Identify energy savings opportunities

4. Use a lead assessor to either do or sign off points 1 to 3 above (unless fully covered by ISO50001)

5. Get a director to sign off that they have seen the recommendations of the work

6. Notify the scheme administrator of ESOS compliance

1. Conduct an ESOS assessment

Identify total energy consumption (buildings, installations, transport)

Common units (either cost or energy measurement unit) 90% of your total energy consumption = ‘Areas of Significant Energy Consumption’

Determine coverage by ISO50001, Green Deal, DECs, existing audits which meet the ESOS criteria Determine additional ESOS audits that need to be undertaken prior to 5/12/2015

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2. Conduct ESOS audit(s)

Compliant audits:

Use12 months’ verifiable data Analyse your energy consumption and energy efficiency Identify practicable ways in which you can improve its energy efficiency Recommend cost effective ‘energy saving opportunities’ Identify the estimated costs and benefits of the ‘energy saving opportunities’ recommended

Where 12 months data is not used or consumption profiling is not undertaken justification must be provided.

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3. Identifying savings opportunities from ESOS audits

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Use life cycle cost analysis to determine cost effectiveness rather than simple pay back period where possible Identify recommendations within your control No requirement in the regulations to implement the identified savings

4. ESOS Lead assessors

Individuals that belong to an ‘approved register’ = ‘lead assessors’

Approved bodies/registers on ESOS webpage Lead assessors can be internal or external Lead assessor signs off the work but can use analysis from others.

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5. Director Sign off

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Show recommendations of the assessment to a board level director

2 directors if lead assessor is internal

No specific format required Director confirms they have reviewed the findings

6. Notifying the EA

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Online notification form accessed from ESOS page on .gov.uk

Provide basic organisation details – not energy data or improvements identified

Needs to be submitted by 5 Dec 2015 to be compliant.

Keep an evidence pack Cost Effective Energy Savings Opportunities Identified Details of your ESOS assessment and audits (where applicable) Certifications for alternative compliance routes Details of any areas where you are not fully compliant with the rules Record of your directors & lead assessors sign off

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There is no prescribed

format for this

Further Detail on ESOS

Qualification

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Employees = anyone with a contract of employment regardless of hours Trade/business of organisation are irrelevant if you meet the criteria of an undertaking (as per Section 1161(1) of the Companies Act 2006) and you qualify you are in ESOS If you are subject (mandatorily) to the Public Contracting Regulations you are excluded from ESOS. Use last accounts prior to 31/12/2014 submitted to Companies House to determine qualification (or may need to go further back if you are near the threshold).

Changes after qualification

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Changes to organisation size/structure etc after the qualification date do not effect qualification. Any organisation sold by a qualifying organisation between 31 Dec 2014 and 5 Dec 2015 needs to comply with ESOS (either with old owner, new owner or on own) Assets (not organisations) sold or acquired during period 31 Dec 2014 and 5 Dec 2015 do not need to included in total energy consumption calculation or be audited.

Unconsumed supplies Unconsumed supply rule can apply if

Energy is supplied by a participant to another organisation The energy can be measured or reasonably estimated.

Doesn’t matter who does the audit as long as it covers all ESOS supplies

– (i.e. 2 or more qualifying participants could be compliant using the same audit. They just reference the energy saving opportunities relevant to them in their evidence pack)

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Data time periods

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Total energy consumption data 12 months data covering 31/12/14 Supplies for all assets covering a specified 12 month period Can use £ or common energy unit Purpose: To determine which assets will need to be covered by compliant audits or alternative routes to compliance

Data for audits 12 months data starting from as far back as 6 Dec 2010 Audits can have been undertaken between 6 Dec 2011 and 5 Dec 2015 Assets don’t need to have been audited at the same time Use energy units for analysis Purpose: To determine energy savings opportunities

Areas of significant energy consumption and audits

Flexibility about which energy is in the 90%

Could exclude all of one fuel type; or Certain assets/activities; or A combination

Don’t need to do a site visit to all assets, if they are very similar then findings can be applied to group of assets and consequent cost effective opportunities calculated on this basis. Lead assessor determines necessary site visits with the participant.

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EA ESOS WEBPAGE:

https://www.gov.uk/energy-savings-opportunity-scheme-esos

ESOS Guidance: https://www.gov.uk/government/uploads/system/uploads/attachm

ent_data/file/323307/ESOS_Guide_FINAL.pdf

ESOS Regulations: http://www.legislation.gov.uk/uksi/2014/1643/contents/made

ESOS Helpdesk esos@environment-agency.gov.uk

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Richard Walsh, ISO 50001 Assessor, NQA

Richard will explain Northern Rails route to ESOS compliance through ISO 50001 and what this means for them.

Sustainability Live – 02/04/14

Presented by: Richard Walsh - ISO50001 assessor - NQA Prepared by: Gareth Williams - Energy Solutions Manager - Northern Rail

NQA certification to ISO 50001 has enabled Northern Rail to meet ESOS scheme requirements why? And what

additional benefits does certification provide.

Northern Rail – What are we?

Northern Rail and ESOS

• Large enterprises are defined within DECC's consultation as enterprises employing more than 250 people and which have an annual turnover exceeding EUR 50 million (nearly £43 million), and/or an annual balance sheet total exceeding EUR 43 million (nearly £37 million).

In accordance with the EU Energy Efficiency Directive, ‘large enterprises’ will be required to conduct energy audits every four years, with the first occurring by 5 December 2015.

• The audits will cover transport, buildings and industrial operations.

Estimated cost

ESOS STEPS vs ISO 50001 STEPS

• ESOS Assessment

• Data collection

• ESOS Audits

• ESOS Assessment

• Data collection

• ESOS Audits

• ESOS Assessment

• Data collection

• ESOS Audits

• ESOS Assessment

• Data collection

• ESOS Audits

ESOS Assessment vs ISO 50001 Energy Planning Section 4.4

• A review is required of the total energy use and energy efficiency of the organisation covering key buildings, key industrial operations and key transport activities.

• This would include the organisation identifying and measuring an energy intensity ratio.

4.4.3 Energy review The organization shall develop, record, and maintain an energy review.

Based on the analysis of energy use and consumption, identify the areas of significant energy use, i.e. identify the facilities, equipment, systems, processes and personnel working for, or on behalf of, the organization that significantly affect energy use and consumption; 4.4.5 Energy performance indicators The organization shall identify EnPIs appropriate for monitoring and measuring its energy performance. The methodology for determining and updating the EnPIs shall be recorded and regularly reviewed.

ESOS Assessment vs ISO 50001 Energy Planning Section 4.4

• The review would need to be proportionate and sufficiently representative ‘to permit the drawing of a reliable picture of overall energy performance’ of the organisation and clear information on potential savings, which identify and quantify cost-effective energy savings opportunities.

4.4.4 Energy baseline The organization shall establish an energy baseline(s) using the information in the initial energy review, considering a data period suitable to the organization's energy use and consumption. Changes in energy performance shall be measured against the energy baseline(s).

ESOS Data Collection vs ISO 50001 Checking Section 4.6

• Organisations within the scheme’s scope will need to identify an approved ESOS assessor (either an in-house expert or an external consultant) to conduct the assessment, gather data on energy usage at an appropriate level of detail, and undertake the assessment by December 2015, renewing the assessment at least every four years thereafter.

4.2.2 Management representative Top management shall appoint a management representative(s) with appropriate skills and competence.

4.6 Checking The organization shall ensure that the

key characteristics of its operations that determine energy performance are monitored, measured and analysed at planned intervals.

ESOS Data Collection vs ISO 50001 Checking Section 4.6

• In practice, ESOS assessments are intended to recommend cost-effective measures to save organisations energy and money. These might include, for example, advice on updating lighting systems, taking steps to encourage staff to adopt more energy efficient behaviour, or (if cost-effective) replacing elements of a transport fleet.

4.6.3 Internal audit of the EnMS The organization shall conduct internal audits at planned intervals.

Northern’s ISO 50001 EnMS

Environmental and Energy Policy

Baseline data/energy review • Data quality poor

– Manual input errors – Invoice validation – Missing invoices

If you cant measure it you cant manage it!

If you cant measure it you cant manage it!

•300 Electric AMR’s installed

•30 Gas AMR’s installed

•Covering over 90% of our electricity and gas consumption

Energy Planning

1. Trains Traction Diesel Consumption (DMU) 2. Trains Traction Electricity Consumption (EMU) 3. Engineering TMD’s 4. Support Offices 5. Manned Stations 6. Unmanned Stations 7. Support Fleet 8. Bus Replacement

1. Trains Traction Diesel Consumption (DMU) 2. Trains Traction Electricity Consumption (EMU) 3. Engineering TMD’s 4. Support Offices 5. Manned Stations 6. Unmanned Stations 7. Support Fleet 8. Bus Replacement

Implementation and Operation

•Notch use

•Coasting

•Shutting off engines

3-4% savings

Traction fuel Responsible Driving Programme

Monitoring, Measurement and Analysis

Non Traction Energy Budgets

GIVE RESPONSIBILITY TO THE BUSINESS DIRECTORATES

WHICH USE THE SIGNIFICANT ENERGY CONSUMPTION

•Area West Director

•Area East Director

•Engineering Director

Make it Business as usual!

Monitoring, Measurement and Analysis

Company League Table

Implementation and Operation

Tenants impacts: • Piccadilly 12th floor, • Sowerby bridge • Urmston Pub • Hough Green taxi company

Implementation and Operation

Brand identity – LOCO2

Management support

Implementation and Operation

10,876 kWh

2,454 kWh

Internal Audits

Benefits

• Systematic approach to energy management

• Senior Management buy in (requirement)

• Company objective = focus on the agenda

• Continual improvement:

– 9% reduction in non traction energy per passenger km since 2009

– 0.5% reduction in traction (diesel) energy per passenger km since 2009

ESOS Compliance

To allow for ESOS compliance the system:

ISO 50001 : 2011 – Energy Management Systems – Requirements with guidance for use

Kit Oung, Energy Managers Association

Kit Oung, Board Member of Energy Managers Association, Author of Energy Management in Business and Energy Audits: The Key to Delivering Real Energy Reductions

Q&A