Transposing EU directives into UK law

How the government plans to improve the Energy Savings Opportunity Scheme and regulate energy use, by Hywel Davies

When the UK was in the European Union (EU), EU directives had to be transposed into UK law. Sometimes, specific UK laws were used, as with energy performance certificates and calculation of carbon emissions from buildings – requirements of the Building Regulations.

More often, powers granted under section 2(2) of the (now repealed) European Communities Act 1972 were used to make regulations to transpose EU directives into UK law. That mechanism was employed for the Energy Savings Opportunity Scheme (ESOS) and the Energy Performance of Buildings Regulations, which implemented aspects of EU Energy Policy introduced more than a decade ago. 

The Energy Bill, just completing its passage through parliament, transfers arrangements for the ESOS and the energy performance regulations firmly into UK law. Part 10 enacts the ‘power to make energy performance regulations’. Paragraph (1) enables the Secretary of State to make regulations for either: 

(a) enabling or requiring energy usage or efficiency of premises to be assessed, certified and publicised 

(b) enabling or requiring possible improvements in the energy usage or efficiency of premises to be identified and recommended.

There are also powers to restrict or prohibit marketing and sale of property where energy performance has not been assessed, certified or publicised. 

This will enable the department responsible for energy policy to regulate energy efficiency and usage across the whole building stock. It provides a firm legal basis for extending the current coverage of energy certificates for public buildings in use to all buildings, whether using the same methodology or developing new ones. 

This is heady stuff and could give a future government significant powers to intervene in the activities of businesses

The powers also explicitly include regulating ‘the anticipated energy usage and energy efficiency of new premises’. This means that, as well as meeting the requirements of Part L of the Building Regulations, there may, for certain types of buildings, be additional requirements relating to energy use in operation – something that has never been done using the Building Regulations, although the legal basis for doing so has often been debated. That debate is now closed, as government has those powers and they do not sit with the Department for Levelling Up, Housing and Communities or the new Building Safety Regulator.

The bill also creates new sanctions for those who fail to comply, with fines of up to £15,000 and, in some cases, imprisonment for up to a year. This nails another long-standing debate over the previous regime under building and energy performance regulations, which has never knowingly been enforced.

Part 11 of the bill creates the enabling framework for future ESOS schemes (and is clear that there may be more than one scheme). The Secretary of State may regulate ‘for the establishment and operation of one or more energy savings opportunity schemes’. These may impose obligations as listed below:

Potential obligations in energy schemes

  • Enable or require energy consumption or consequential greenhouse gas emissions for which an undertaking is responsible to be assessed, audited, reported and published
  • Enable or require possible energy savings or emissions reductions to be identified and recommended; enable or require costs and benefits of those energy savings or emissions reductions to be assessed
  • Encourage or require plans or targets for achieving energy savings or emissions reductions
  • Encourage or require action to achieve energy savings or emissions reductions
  • Encourage or require the achievement of energy savings or emissions reductions. 

This is heady stuff and could give a future government significant powers to intervene with renewed energy in the activities of businesses. It will enable the plans, consulted on last year, to strengthen the ESOS regime for its next phase. Taken together, these two unheralded parts of the bill create a much more robust regime for regulating energy use of buildings in operation.

Anyone involved in the current ESOS is strongly advised to download the bill (or act) and read Part 11. It will constitute an hour’s CPD at least, and give a clear view of the direction in which this policy is likely to go.