Talking Point: What does the Energy Saving Opportunity Scheme mean for hotels?

Premier Inn's The Hub

Premier Inn's The Hub

To unpick how hotels should respond to the UK government's requirement that all 'large undertakings' carry out energy audits before Dec 2015, we spoke to Lesley Treacy Associate Partner at Greengage Environmental LLP

The government’s Energy Saving Opportunity Scheme (ESOS) is one that requires all “large undertakings” to carry out a programme of energy audits before December 2015.  Hotel groups qualify for the Scheme if they employ over 250 people or have an annual turnover of £38.9m (€50m).

The scheme is the UK response to the EU Energy Efficiency Directive and the government have estimated that the Scheme will lead to £1.6bn net benefits to the UK.  It is anticipated that the majority of these benefits will be directly felt by businesses through energy savings.  As well as the benefit to the bottom line, implementation of the scheme will contribute to meeting the EU’s 20% energy reduction by 2020.

Qualifying hotel groups must carry out energy audits of their property portfolio, business process and business transport operations.  The energy audits will identify efficiency measures within these three areas.  Although not a mandatory requirement (at this stage) to execute any of the efficiency recommendations, the government believe that once organisations see the potential savings, implementation will follow.  Hotel groups also must appoint a Lead Assessor to review the energy audit information and ensure compliance with the ESOS requirements.  The results from the energy audits will also need be reported to and signed off by the Board.

Hotel groups will need to confirm compliance 5 December 2015.  Participation is re-assessed for the second and subsequent compliance periods every four years.

Companies that fail to comply could face up to £100,000 fines - £50,000 for not undertaking the ESOS assessment and around £50,000 additional fines for not using an accredited ESOS assessor, maintaining records and daily fines until compliance is achieved. Criminal proceedings could also be taken for non-compliance.

Room for improvement

ESOS is an opportunity for hotel operators to improve operational efficiencies.  The scheme will help operators to identify waste energy across their property portfolio and the energy audit programme can support the business case for optimisation improvements.

As Board level sign off is required, ESOS will help ensure that energy consumption is placed firmly on the agenda of senior management and so emphasise the need for energy improvements.  ESOS should be used to complement existing improvement campaigns and such focus can lead to improvements in team engagement and collaborative working environments.

In addition, the resultant efficient heating, cooling and lighting in hotel rooms and lobbies may result in an improved visitor experience.  Energy savings will ultimately translate to cost and carbon savings.  Such measures should form part of a suite of responsible behaviours that can help drive wider sustainability efforts and build resilience into hotel portfolios.

ESOS Compliance Tips for Hotel Operators

  • Research whether your operations need to comply with the scheme. Consider the corporate legal structure for the hotel group and determine if you fall under the definition of a ‘large undertaking’ in the UK.
  • Carry out a gap analysis. Determine if group energy management information can be reused for ESOS compliance and identify what actions still need to be carried out.
  • Appoint a Lead Assessor. A Lead Assessor can work with your facilities maintenance team to determine the scope of work and most expedient route to compliance.
  • Ensure that the energy audit analyses energy consumption across all areas of operations, processes and business transport. Cost-effective and practical energy efficiency recommendations should result from the energy audits.
  • Produce an ESOS Energy Audit Report. Use the recommendations from the ESOS to drive an energy efficiency campaign across the hotel group.  Incorporate into portfolio or estate strategy for maximum returns.
  • Develop an ESOS compliant Evidence Pack. The Evidence Pack should provide a clear audit trail of compliance for your hotel group.
  • Involve the entire team. The facilities maintenance team should play a large role in ESOS.  However, senior management need to be involved.  The financial director will need to understand the costs associated with Energy Audit recommendations, while your ESOS documentation will need to be signed off by a board level director.

If you are caught by the new regulations then you need to understand what is required to meet these obligations. The EA‘s new guidance Complying with the ESOS Scheme clarifies some points around who will be affected and how ESOS will be run.

Greengage have worked with a number of hotel operators/ owners such as Accor, Whitbread Group PLC, & Hoxton Hotels (Ennismore Capital) on their sustainability and energy requirements.  The Energy Audit carried out for the Kingsway Hall Hotel in Holborn helped the owners (Cola Holdings) identify opportunities to improve, not only the energy efficiency of the hotel, but also the customer experience and operational effectiveness.  In total the energy efficiency recommendations made by Greengage were estimated to reduce carbon dioxide emissions by 15 tonnes CO2/year which was augmented by the installation of photovoltaic panels to generate renewable power for the hotel, saving a further 14 tonnes CO2/year.

Greengage are a sustainability consultancy that works in partnership with clients to deliver truly sustainable solutions, through a holistic, innovative and no nonsense approach.They recently acted as Sustainability Consultants on the UK’s first BREEAM Outstanding Hotel: the Hub Hotel (Whitbread Group PLC). Greengage are also working with a number of organisations on their ESOS requirements and have produced a that provides the essential information you need to know to help your hotel meet their obligations under ESOS.  For more information please contact Lesley Treacy,( ) or Iain Fraser, who is a qualified ESOS Lead Assessor (

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