ESOS Phase 3 second progress update: what must be submitted by 5 December 2026

Executive summary

Organisations that qualified for ESOS in the third compliance period and submitted an action plan must notify a second annual progress update by 5 December 2026. GOV.UK is explicit on the point: an annual progress update is due by that date in relation to the action plan submitted, it must be signed off by a board-level director (or equivalent), and it must be submitted through MESOS, the online reporting service. See the Environment Agency and DESNZ guidance page on ESOS.

The obligation is a reporting obligation, not a delivery obligation. Nothing in the guidance requires that every measure in an action plan has been implemented. What it requires is an accurate, evidenced account of what has been implemented, what has not been implemented by the date set for it, and a defensible estimate of the energy savings attributable to the relevant 12-month reporting period. Because the Environment Agency publishes each progress update, the submission is a public statement made under director sign-off, and it should be prepared to that standard.

Key points for compliance and reporting leads

• Deadline: 5 December 2026, for participants that notified compliance in ESOS Phase 3 and submitted an action plan.
• Reporting period for savings estimates: the 12 months preceding the deadline, running 6 December 2025 to 5 December 2026.
• Route: MESOS, with sign-off by director(s) or equivalent individuals with management control.
• Content: measures implemented since the first progress update, whether action plan measures were implemented by their stated dates, measures not implemented, savings estimates, and the method and data behind each estimate.
• Publication: the Environment Agency publishes progress updates within six months of the deadline or of receipt, whichever is later.
• Evidence: the calculation method and underlying data for every estimate must be retained in the evidence pack.

Who this applies to

The requirement attaches to Phase 3 participants — organisations that qualified in the third compliance period, which ran from 6 December 2019 to 5 December 2023 — and that were required to submit an action plan. Participants whose notification of compliance reported zero total energy consumption during the reference period were not required to produce an action plan and therefore have no progress update to make. Where a responsible undertaking notified on behalf of a highest UK parent group, the responsible undertaking carries the reporting duty for the participant.

Group changes since the action plan was notified need attention rather than assumption. The guidance deals with undertakings that leave a group, undertakings acquired between the compliance date and the action plan deadline, and the treatment of a qualifying undertaking acquired by a non-qualifying group. Where responsibility has moved, the position should be documented in writing and any change to the members of the participant notified alongside the submission.

If an action plan was never submitted, the guidance directs organisations to contact the Environment Agency rather than to fold the omission into a later filing.

What the second progress update must contain

The content requirements are set out in section 14 of the guidance on how to comply with ESOS Phase 4, which the ESOS landing page directs Phase 3 participants to for progress-update mechanics. Each update must identify:

• All energy saving measures implemented since the previous progress update was notified, including measures that were never in the original action plan.
• Whether each measure in the action plan was implemented by the date set for it.
• Any action plan measures not implemented by the date set for them.
• An estimate of the energy savings achieved, or to be achieved, during the 12-month reporting period as a result of those measures, expressed in energy units.
• The method and data used for each estimate.

Estimates must be attributed to one of three bases: the prior estimate included in the action plan, data from the ESOS audit or alternative compliance route, or another reasonable estimation method. The guidance does not require organisations to separate realised savings from expected savings for notification purposes, but it does require the estimation method to be stated and the supporting data retained.

Measures that are complete, delayed, altered or abandoned

A common misreading is that a missed measure is a compliance failure. It is not. The published worked examples in the guidance show a participant reporting a measure delivered six months late, and separately reporting a measure that was not implemented at all because of delivery delays. Both are reported outcomes, not breaches. What is not acceptable is silence: a measure with a passed implementation date must be identified as not implemented.

Where scope has changed — a like-for-like boiler replacement substituted for a heat pump, a lighting scheme delivered across four sites instead of nine, a measure superseded by a landlord's works — the pragmatic approach is to report the measure actually implemented, note the divergence from the action plan commitment, and keep the internal decision record in the evidence pack. Note that the amended regulations introduce, for Phase 4, a requirement to include progress against action plan commitments in the ESOS assessment and to explain where commitments have not been met. That explanatory duty is framed as a Phase 4 change; for the Phase 3 second progress update the express reporting requirement is identification. NZC view: provide a short factual explanation anyway. It costs little, it is consistent with the direction of the regime, and the update is published.

Evidencing savings estimates

Savings estimates are where most submissions are weakest, and they are the part that is published. Three practical constraints follow from the guidance.

• The estimate covers the 12-month reporting period only, regardless of when in that period the measure was implemented.
• Only measures implemented since the previous notification fall within the mandatory scope, with an option to volunteer information on earlier measures.
• The estimation method must be recorded, and the calculation and data retained in the evidence pack for regulator scrutiny.

For multi-site estates, the practical implication is that half-hourly and invoice data for the reporting period should be reconciled before the estimate is fixed, not after. Where sub-metering is absent, a stated pro-rata or engineering estimate is acceptable provided the method is disclosed; an unexplained round number is not. Weather correction, occupancy change and tariff change should be handled in the method, not silently absorbed into the number. Submitting close to the deadline, as the Environment Agency recommends, allows more of the estimate to rest on actual data.

Governance and director sign-off

The update must be signed off by the same number of directors, or equivalent individuals with management control, as were required to sign the notification of compliance. They need not be the same individuals. The directors confirm that they have seen and considered the progress update and are satisfied, to the best of their knowledge, that the responsible undertaking has complied with the requirements relating to it.

For a listed group or a fund manager, that confirmation should be supported by the same control environment used for other published non-financial information: a documented data source for each figure, a reviewer independent of the person preparing it, and a board or committee paper recording what was approved. If an inaccuracy is later found, the guidance directs participants to email the Environment Agency so that revised information can be published — a correction route, not a quiet amendment.

How this connects to Phase 4 preparation

The second progress update lands almost exactly a year before the Phase 4 compliance deadline of 5 December 2027, and less than four months before the Phase 4 qualification date of 31 December 2026. Two efficiencies are available to organisations that plan the work together rather than sequentially.

• The data reconciliation needed for the progress update covers a period that sits inside the Phase 4 reference window for most participants, so the same meter, invoice and site-boundary work can serve both.
• Measures reported as implemented feed directly into the Phase 4 assessment, where progress against action plan commitments must be included.

Organisations should also note two Phase 4 changes announced ahead of the fourth compliance period: Display Energy Certificates and Green Deal assessments are no longer available as alternative compliance routes, and net zero considerations may be included voluntarily using PAS 51215-1:2025 and PAS 51215-2:2025. Our companion analysis of ESOS Phase 4 qualification for corporate groups covers the organisational boundary question in detail.

Points to get right

• Re-read the notified action plan before reporting, so measure descriptions and the works actually delivered align.
• Claim savings for measures implemented within the mandatory reporting scope, and note separately any delivered earlier.
• State where an estimate is carried forward from the action plan, so the basis is visible to the reader.
• Reconcile site disposals and acquisitions during the reporting period, so reported savings reflect efficiency rather than portfolio churn.
• Keep the evidence for each measure in the participant's own evidence pack, not only in a consultant's model.
• Seek sign-off early enough that a data problem can still be corrected before a published submission.

Recommended sequence for corporate groups and multi-site estates

• Retrieve the notified action plan and the first progress update, and list every measure with its stated implementation date.
• Confirm the participant boundary as it now stands, including any undertakings that have joined or left since the action plan was notified.
• Collect implementation evidence for each measure: commissioning records, invoices, handover documentation, dates.
• Reconcile consumption data for 6 December 2025 to 5 December 2026 at meter level before calculating any estimate.
• Fix the estimation method per measure and record it, together with the underlying data, in the evidence pack.
• Prepare the director sign-off paper with the published output attached in the form it will appear.
• Submit through MESOS close to, but not on, the deadline.

Risks of leaving this late

The regulators have civil sanction powers, including financial penalties, and the Environment Agency's approach is set out in its enforcement and sanctions policy. The more immediate risk for institutional organisations is reputational and contractual rather than regulatory: progress updates are published, and lenders, LPs and procurement teams increasingly read them alongside SECR disclosures and fund-level reporting. An update that reports no measures, or that publishes savings estimates that cannot be reconciled with reported energy consumption elsewhere, is a visible inconsistency.

NZC view

The following is professional interpretation rather than official guidance. We treat the progress update as a published assurance product, not a form-filling exercise. In practice that means fixing the estimation methodology at the start of the exercise, documenting divergence from the action plan in plain terms, and keeping the evidence pack in the participant's control rather than the adviser's. Where a measure has been abandoned for sound commercial reasons, saying so factually is a stronger position than a vague implementation claim that cannot be evidenced if a regulator asks.

How NZC Consultants can help

We support qualifying organisations with progress-update preparation, savings estimation methodology, evidence pack construction and director sign-off packs, and with the wider ESOS compliance programme. Where the same estate carries property compliance exposure, our commercial MEES advisory work runs alongside it.

To discuss ESOS evidence and progress reporting ahead of 5 December 2026, speak to an NZC Consultants director.

Primary sources

• Energy Savings Opportunity Scheme (ESOS): find out if you qualify and how to comply — DESNZ and Environment Agency
• How to comply with the Energy Savings Opportunity Scheme (ESOS) Phase 4, section 14: annual progress updates — Environment Agency
• The Energy Savings Opportunity Scheme Regulations 2014, as amended — legislation.gov.uk

This article is general commentary on published regulatory requirements as at 4 September 2026. It is not legal advice and should not be relied on as such. Requirements should be verified against the current official guidance and the ESOS Regulations before any submission is made.