Business energy audits: what they cover and how to do one

Most businesses know roughly what they spend on energy but not where it goes. An energy audit fills that gap. It can be as simple as walking round your premises with a checklist after closing time, or as detailed as a consultant logging every major load for weeks. Either way, the aim is the same: a short list of changes, in order, that will cut your bills.

What is a business energy audit?

A business energy audit is a structured review of how your premises uses electricity and gas, where energy is being wasted, and which changes would save the most for the least cost. A good audit ends with a list of measures, each with an estimated cost, annual saving and payback period.

The government’s Building Energy Efficiency Survey defines payback as the time it takes for the savings from a measure to match the cost of installing it. That is the number to ask for on every recommendation.

What types of energy audit are there?

Type	Who does it	What it involves	Best for
Walk-round survey	You or a member of staff	A checklist walk round at different times, plus meter readings	Every business, as a starting point
Bill and meter review	You, a supplier or a consultant	A year of bills, monthly or half-hourly readings, out-of-hours use	Spotting waste and billing errors
Funded assessment	Scheme adviser or approved consultant	A site visit and a report with recommendations	SMEs in Scotland, Wales and Northern Ireland (see below)
Detailed or ESOS audit	Qualified assessor	Site visits, 12 months of consumption data, savings opportunities identified	Large undertakings and energy-intensive sites

ISO 50001 is different again: it is a standard for running energy management as an ongoing system, and ESOS accepts certification to it as a route to compliance.

An ESOS energy audit has to analyse your energy use and efficiency, identify savings opportunities, include site visits, and be based as far as reasonably practicable on verifiable data measured over a 12-month period.

Does your business have to have an energy audit?

Only if it is a large undertaking under the Energy Savings Opportunity Scheme (ESOS). For phase 4, a large undertaking is a UK company that either:

• employs 250 or more people, or
• has annual turnover above £44 million and an annual balance sheet total above £38 million.

Your organisation qualifies for phase 4 if it meets that definition on 31 December 2026. The deadline for notifying compliance is 5 December 2027. ESOS assessments are repeated every four years.

The assessment must cover areas that make up at least 95% of your total energy use, across buildings, industrial processes and transport. It must be signed off by an ESOS lead assessor unless your energy use is covered by ISO 50001 certification or is under 40,000 kWh, and a board-level director must sign off the notification. From phase 4, you also have to report progress against earlier action plan commitments.

Two other rules are worth knowing, even though neither is an audit:

• Landlords of commercial property in England and Wales have needed an EPC rating of at least E to let a non-domestic property since 1 April 2023, unless a valid exemption is registered.
• Larger companies may have to report energy use under Streamlined Energy and Carbon Reporting. Our renewable business energy guide explains who is in scope.

How do you do your own energy audit?

You don’t need special equipment to start. The Carbon Trust’s approach for smaller businesses works like this:

1. Gather a year of bills. Note the kWh used each month for each meter. Our guide to reading a business energy bill shows where to find it.
2. Compare with similar businesses. The Carbon Trust suggests dividing annual kWh by floor area to get kWh per square metre, separately for electricity and gas. Our sector pages, such as offices and shops, list published benchmarks.
3. Measure out-of-hours use. Read the meter at closing time before a weekend and again when you open. The difference is what your building uses empty.
4. Walk round at different times. At the start and end of the day, during opening hours, and just before a weekend or holiday. The Carbon Trust also suggests walk rounds when the clocks change and at the beginning and end of the heating season, so controls are set for the time of year.
5. Note what you find using the checklist below.
6. Prioritise. Put the biggest savings and least disruptive changes first.
7. Write an action plan with an owner and a date for each item, then read the meters again to check the result.

If you have half-hourly or smart meter data, you can see overnight and weekend use without visiting. Our half-hourly meter guide explains what the data shows.

What should you check on a walk round?

This checklist draws on the Carbon Trust’s walk-round guidance.

Heating and cooling

• When were boilers and heaters last serviced?
• Are thermostats set sensibly (generally 19 to 20°C for heating) and away from draughts and sunlight?
• Do timers match your opening hours?
• Are heating and air conditioning ever on in the same space at once?
• Are portable electric heaters in use? That usually means people are unhappy with the temperature.
• Are doors and windows open while the heating is on?
• Are storerooms and corridors heated as much as occupied rooms?

Lighting

• Are there halogen, tungsten or old fluorescent fittings?
• Are lights on in empty rooms, or out of hours?
• Are outside lights on in daylight?
• Are fittings, windows and rooflights clean? The Carbon Trust says light levels can fall by up to 30% in two to three years without maintenance.

Equipment

• Are computers, screens and printers left on overnight?
• Are power-saving settings enabled?
• Are machines or conveyors left running between jobs?

Refrigeration and compressed air

• Are fridge and cold room seals in good condition and doors kept shut?
• Are chillers free of ice and debris?
• Does the compressor run when no air is needed? Listen for leaks when the site is quiet.

Meters

• Do you know where every meter is, and what it supplies?
• Are you billed on actual or estimated readings?

What does a good audit recommendation look like?

A useful recommendation gives you enough to make a decision. Here is a real example from a Carbon Trust case study. APS Metal Pressings was recommended an LED lighting upgrade with these figures:

Item	Figure
Estimated cost	£24,000
Annual saving	£6,000
Simple payback	£24,000 ÷ £6,000 = 4 years
Lighting energy saved	63%

The case study comes from a 2017 Carbon Trust guide whose own running-cost examples assumed electricity at 10p to 12p per kWh. The DESNZ average for small non-domestic users was 28.76p in early 2026, so the same kWh saving would be worth more today. That is why a recommendation should state the unit rate it assumes: you can then update the saving with your own price.

When you get a report, check each measure has:

• the estimated installed cost
• the annual saving in kWh and in pounds, and the unit rate used
• the simple payback period
• any funding or tax relief assumed
• what it would disrupt, and when it could be done

Where can you get a free or funded energy audit?

Support depends on where your business is. These were open on the official scheme websites as of September 2026:

• Scotland: Business Energy Scotland, funded by the Scottish Government, offers free support and energy assessments to SMEs in Scotland. An assessment is also the first step if you want an interest-free loan from its SME Loan Scheme.
• Wales: The Development Bank of Wales, working with Business Wales and the Welsh Government, offers fully and part-funded consultancy. Grants cover up to 50% of costs, to a maximum of £10,000 (£20,000 total costs), alongside its Green Business Loan Scheme.
• Northern Ireland: Invest NI appoints and funds a specialist consultant for businesses with annual energy and resource spend over £30,000, through its Technical Consultancy Support.
• England: We could not find a national funded audit scheme for SMEs on GOV.UK. Some local councils run their own, so check your council’s website.

Our energy efficiency grants guide covers the funding available once you know what to install.

What happens after the audit?

The Carbon Trust’s advice is to make one person responsible, agree a simple schedule of improvements, and involve staff. Its guidance is that effective action has to come from the top and should not be a one-off.

The government survey found the largest savings potential across all non-domestic buildings came from three areas: carbon and energy management, lighting replacement and controls, and building services controls. Together they made up 55% of the total. In practice that means good routines, better lighting and properly set heating controls. Our guides to LED lighting, business heating costs and reducing business energy costs take each one further.

Frequently asked questions