ESOS Phase 3 vs Phase 4: What Actually Changed

The short answer. Phase 4 keeps the same qualification thresholds and the same four-year rhythm as Phase 3. What changed is how you comply: Display Energy Certificates and Green Deal Assessments have gone as routes, the ISO 50001 exemption is wider, and you now have to report what your last action plan actually achieved.

The Energy Savings Opportunity Scheme (Amendment) Regulations 2026 came into force on 22 July 2026, and the government published its updated Phase 4 guidance the same day. If you complied in Phase 3 and assumed Phase 4 would be a repeat exercise, three of the changes below will affect how you plan it.

This page sets out what is different, what is not, and what each change means in practice.

At a glance

	Phase 3	Phase 4
Compliance period	6 December 2019 to 5 December 2023	6 December 2023 to 5 December 2027
Qualification date	31 December 2022	31 December 2026
Compliance deadline	5 June 2024, after a six month extension	5 December 2027
Qualification thresholds	250 staff, or £44m turnover and £38m balance sheet	Unchanged
Significant energy consumption	At least 95% of the total	Unchanged
Compliance routes	Energy audits, ISO 50001, DECs, Green Deal Assessments	Energy audits and ISO 50001 only
ISO 50001 exemption	Only where certification covered total energy consumption	Total or significant energy consumption
Reporting past savings	Not required	Required, per measure and by category
Action plan review	Not required	Required, with reasons for anything not done
Lead Assessor duties	Review and sign-off	Review, sign-off, and notifying their professional body

What actually changed

Two compliance routes have gone

Display Energy Certificates and Green Deal Assessments are no longer accepted. From Phase 4, the only routes are energy audits, ISO 50001 certification, or a combination of the two. The government's reasoning is that the removed routes no longer meet best practice.

If a DEC covered part of your Phase 3 compliance, that portion of your energy consumption now needs auditing or bringing inside an ISO 50001 scope. This is the change most likely to add work, and it is worth identifying early rather than during the assessment.

The ISO 50001 exemption is wider

This is the change most likely to save work, and it is the one being missed.

In Phase 3, ISO 50001 only released you from appointing a Lead Assessor if the certified system covered the whole of your total energy consumption. For Phase 4, certification covering either your total energy consumption or your significant energy consumption exempts you from appointing a Lead Assessor and from producing an ESOS report.

Significant energy consumption is 95% of the total, so this is a materially lower bar. Certifying the last 5%, which is often a scatter of small sites, transport or minor assets, was frequently what made whole-scope certification impractical. That obstacle has gone.

If you looked at ISO 50001 in Phase 3 and concluded the scope was unworkable, the arithmetic has changed. Our ISO 50001 guide covers what certification involves.

One caveat that catches people out: the exemption covers the Lead Assessor and the ESOS report. It does not cover the notification of compliance. Participants with ISO 50001 certification, and zero energy users, still have to notify.

Certification must come from a UKAS accredited certification body, a body accredited by an EU member state's national accreditation body, or a body accredited by a member of the International Accreditation Forum.

You have to report what your last action plan achieved

Phase 3 required an action plan and annual progress updates. Phase 4 pulls that history into the assessment itself.

Your ESOS report and notification of compliance must now set out the energy savings achieved during the compliance period, and for each measure you implemented:

• a description of the measure
• the energy saving it delivered
• its category, such as behaviour change, training or capital investment

You must also review the previous action plan, list any measures you proposed but did not implement, and explain why.

This detail is not published. The requirement is an honest account, not a perfect one, and "we did not proceed because the payback did not stand up" is a legitimate answer. The practical risk is not having the records to write it, which is an argument for gathering them before 2027 rather than reconstructing them afterwards.

Lead Assessors have a new notification duty

Lead Assessors must now notify their professional body of each assessment they complete or review, along with the participant's contact details. The professional body may then approach you for consent to see the ESOS report so it can carry out a quality check.

Nothing is required of you beyond responding, but it is easier to handle when you know it is coming. See our Lead Assessor guide for what the role covers.

The notification of compliance asks for more

Three additions, two of which were voluntary in Phase 3:

• the total number of sites covered by your energy audits
• your ISO 50001 certification details
• UK SIC codes, replacing the international codes used in Phase 3

What has not changed

Worth stating plainly, because a fair amount of commentary implies otherwise.

The qualification thresholds are the same: 250 or more employees, or an annual turnover in excess of £44 million together with a balance sheet total in excess of £38 million. Both financial tests must be met, not either. The government considered aligning them with Streamlined Energy and Carbon Reporting and decided against it.

Significant energy consumption remains at least 95% of the total, with the remaining 5% available as a de minimis exclusion. Board-level sign-off is still required, and it still has to be a director or equivalent. The evidence pack requirement remains, with some improvements to how methods and data are recorded.

Full detail is on our qualification criteria page.

What this means for you

If you complied in Phase 3 using energy audits. The structure is familiar. Budget for the savings and action plan reporting, and make sure whoever holds the Phase 3 action plan can produce it. That is the new work.

If you used a DEC or a Green Deal Assessment. That route has closed. Decide now whether the affected consumption goes into an audit or into an ISO 50001 scope, because it changes the shape of the project.

If you hold ISO 50001, or considered it. Check what your certificate actually covers. If it covers your significant energy consumption, you may be exempt from the Lead Assessor and the report. If you ruled certification out on scope grounds in Phase 3, it is worth looking again.

If you are newly in scope for Phase 4. None of the above is a change for you, and the ESOS assessment guide is the better starting point.

Where to go next

For the full timetable, see the ESOS key dates. To check whether you are in scope, read Do you qualify for ESOS Phase 4?. For background on the scheme, see our ESOS guide.

If you want the Phase 4 assessment handled, or a review of what the changes mean for your organisation, see our ESOS compliance services.