New compliance requirements introduced by the European Union (Energy Efficiency) Regulations 2014 (the “2014 Regulations”), which came into force on 4 December 2014, are now beginning to come into focus for companies falling within the remit of the legislation.  The purpose of the 2014 Regulations is to give effect to the EU Energy Efficiency Directive (2012/27/EU) which identifies measures that must be introduced by EU Member States in order for the EU to meet its binding energy efficiency and emissions targets.

The most significant aspect of the 2014 Regulations for companies in Ireland is the establishment of the “energy audit scheme”.  Any company that has: (i) more than 250 employees; and (ii) an annual turnover exceeding €50 million or an annual balance sheet total exceeding €43 million, is required to carry out energy audits.  The first energy audit must be carried out prior to 5 December 2015.  The next audit and subsequent audits must take place within four years of the previous energy audit.  The audits must be carried out by either: (i) independent registered energy auditors; or (ii) in-house energy auditors registered under the energy audit scheme and who are obliged to provide audit details to the Sustainable Energy Authority of Ireland (the “SEAI”) upon request. The SEAI has established a national registration scheme for energy auditors.  A person shall not be considered for registration as an energy auditor unless they meet certain minimum criteria.  

There is currently a discrepancy between the 2014 Regulations and SEAI guidance in relation to what companies are required to carry out an energy audit.  The SEAI guidance states that the energy audit scheme may apply to any company that has: (i) 250 employees or over; or (ii) an annual turnover in excess of €50 million and an annual balance sheet total in exceeding €43 million.  Given the need to confirm the applicable criteria to allow clients determine whether the obligation to carry out an energy audit applies, we expect that additional guidance will be published by SEAI shortly to clarify this point.

A company may, in certain circumstances, be exempted from these energy audit requirements if it is implementing an energy or environmental management system certified by an independent body according to the relevant European or international standards (ie, ISO 50001 or ISO 14001), provided that the SEAI ensures that the management system concerned includes an energy audit on the basis of specified minimum criteria.

The SEAI is required to publish minimum criteria for energy audits on its website.  Among other requirements, energy audits must be proportionate and sufficiently representative to permit the drawing of a reliable picture of overall energy performance and the reliable identification of the most significant opportunities for improvement.

In addition to the above, the 2014 Regulations: (i) impose obligations on public bodies relating to the efficient use of energy so that the public sector will demonstrate an exemplar role, including in the areas of energy audits, energy efficient public procurement and purchase or lease of energy efficient buildings; (ii) set out specific requirements around metering and billing for energy users; (iii) set out requirements in relation to the promotion of energy in the combined heat and power (CHP) sector; and (iv) set out a range of obligations regarding the co-ordination, supervision and issuance of guarantees of origin.  

Follow this link to the 2014 Regulations.