ESOS Phase 4 · Schedule 1
ESOS Phase 4 qualification: the large undertaking test
Whether an organisation is in ESOS Phase 4 is settled on a single day, 31 December 2026, by a test in Schedule 1 of the Regulations.
The test is short, but its wording, its group rule and its exclusions catch organisations out.
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Four questions, one answer
The tree follows the order the Regulations apply the test.
Insolvency is asked first because it removes an undertaking that would otherwise qualify.
The group question comes last because it can bring in an undertaking that is small on its own figures.
The wording
“At least” and “in excess of” are not the same
The employee limb is inclusive: 250 qualifies.
The money limbs are exclusive: a turnover of exactly £44 million does not.
And the money test needs both turnover and balance sheet over their limits at once.
The Environment Agency’s Phase 4 guidance restates the test; the wording that decides a borderline case is the Schedule’s.
| Figures on 31 Dec 2026 | Large? | Why |
|---|---|---|
| 250 employees | Yes | At least 250 |
| 249 employees, £45m turnover, £39m balance sheet | Yes | Both money limbs exceeded |
| 249 employees, £60m turnover, £30m balance sheet | No | Balance sheet not exceeded |
| 100 employees, £44m turnover, £50m balance sheet | No | £44m is not in excess of £44m |
Groups
One large company brings in the group
ESOS looks at UK groups, not single companies.
Where any UK undertaking in a group is large, every UK undertaking in that group participates, however small it is.
The group normally notifies as one participant through a responsible undertaking, usually the highest UK parent.
An overseas parent does not itself participate, but its UK subsidiaries are tested and grouped under the same rule.
Status on 31 December 2026 decides Phase 4, so an acquisition or disposal in 2027 does not change who must notify by 5 December 2027.
Exclusions and geography
Who is out, and who regulates who is in
SI 2026/701 widened the insolvency exclusion to proceedings at any point between the qualification date and the compliance date.
ESOS covers England, Wales, Scotland, Northern Ireland and offshore activities.
The regulator follows the registered office under regulation 6, and the Environment Agency administers the scheme for the whole UK.
Thresholds were not aligned with SECR in Phase 4; ESOS and SECR remain separate tests.
Once in, the next step is the lead assessor and sign-off, and the family’s ESOS Phase 4 compliance guide on uksrs.org.uk covers every duty that follows.
Frequently asked
Questions people ask
What is the ESOS Phase 4 qualification date?
31 December 2026.
Regulation 4(3)(b) makes the qualification date the 31 December immediately before the compliance date, which for Phase 4 is 5 December 2027.
What are the ESOS qualification criteria?
An undertaking is large if it employs at least 250 persons, or has an annual turnover in excess of £44 million and an annual balance sheet total in excess of £38 million.
Both money limbs must be exceeded together.
Does a whole group have to comply with ESOS?
Yes.
If any UK undertaking in a group is a large undertaking, the UK group participates as a whole, with one responsible undertaking notifying for it unless the group agrees to split.
What if our size changes after 31 December 2026?
It makes no difference to Phase 4.
Status on the qualification date governs, so an undertaking that qualified must comply by 5 December 2027 even if it shrinks, and one that grows afterwards waits for the next qualification date, 31 December 2030.
Are insolvent companies excluded from ESOS?
Yes.
SI 2026/701 widened the exclusion to undertakings subject to insolvency proceedings at any point between the qualification date and the compliance date, and to group undertakings of an insolvent large undertaking.
Does ESOS apply in Scotland and Northern Ireland?
Yes.
ESOS applies across the UK and to offshore activities.
The compliance body follows the registered office: the Environment Agency in England, Natural Resources Wales, SEPA in Scotland, the Northern Ireland regulator, and the Secretary of State for activities wholly or mainly offshore.
Sources
Primary sources
Every figure, date and status on this page traces to the instrument’s owner.
Secondary commentary is never the source for a number.
- legislation.gov.ukSI 2014/1643 Schedule 1 — the large undertaking test and amounts A and B
At least 250 employees, or turnover in excess of £44m and balance sheet in excess of £38m.
- legislation.gov.ukSI 2014/1643 regulation 4 — compliance periods, qualification and compliance dates
Generates 6 Dec 2023 – 5 Dec 2027, 31 Dec 2026 and 5 Dec 2027.
- legislation.gov.ukThe Energy Savings Opportunity Scheme Regulations 2014 (SI 2014/1643)
The scheme itself. The consolidated text does not yet show the 2026 amendments.
- legislation.gov.ukThe Energy Savings Opportunity Scheme (Amendment) Regulations 2026 (SI 2026/701), in force 22 July 2026
Every Phase 4 change: routes, savings reporting, the action plan review, the third progress update.
- legislation.gov.ukSI 2026/701 — Explanatory Note
The government’s own summary of what the 2026 amendments do.
- legislation.gov.ukSI 2014/1643 regulation 6 — the compliance bodies
Which regulator a participant answers to.
- Environment AgencyHow to comply with the Energy Savings Opportunity Scheme (ESOS) phase 4 (30 July 2026)
The regulator’s guidance; a restatement of the Regulations, never the master.
- Environment AgencyComply with the Energy Savings Opportunity Scheme (ESOS) phase 4 — publication page
Published 30 July 2026.
- Environment AgencyESOS phase 4 guidance, Appendix C — advice for complying with ESOS
Practical notes, including participants in other schemes.
- Environment Agency / GOV.UKEnergy savings opportunity scheme (ESOS): find out if you qualify and how to comply (updated 2 September 2026)
The GOV.UK hub, now a Phase 4 page, and the approved lead assessor register list.
- legislation.gov.ukThe Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018 (SI 2018/1155)
SECR — a separate, annual regime; ESOS thresholds were not aligned with it in Phase 4.