Streamlined Energy & Carbon Reporting

Ensuring your compliance with the new reporting requirements

From financial years beginning on or after 1 April 2019, large UK companies will be required to report publicly on their UK energy use and carbon emissions within their Directors’ Report. This new requirement has been implemented by the Department for Business, Energy and Industrial Strategy (BEIS).

SECR will impact any companies, LLPs and groups that exceed at least two of the following three thresholds in the financial year:

£36m annual turnover
£18m balance sheet total
250 employees

For businesses meeting the above criteria, company or group reporting is required regardless of whether an overseas parent company or group has published a similar report. A group may however exclude any energy and carbon information relating to any subsidiaries which would not be obliged to report individually according to the thresholds. After undertaking a calculation, where a company has consumed less than 40MWh, a disclosure is not required.

What needs to be reported?

UK (and UK offshore) energy use and related Scope 1 & 2 Greenhouse Gas (GHG) emissions.

Scope 1 - Direct emissions

Fuel use from transport (where thejourney begins or ends in the UK)
Combustion of natural gas

Scope 2 - Indirect emissions

Electricity purchased and used for operations (not including energy sold on)

Scope 3 - Other indirect emissions

Energy use and related emissions from business travel in rental cars or employee owned vehicles where the company is responsible for purchasing the fuel

Intensity metric for year-on-year

E.g. Tonnes of CO2e per FTE

Supporting narrative

Methodologies used within the calculation
Energy efficiency action taken in the year

Voluntary disclosures

Wider scope 1 emissions - including otherfuel use, refrigerants & manufacturing emissions
Scope 3 emissions - upstream and downstream energy use comparison

What are the key challenges and opportunities?

Determining the operational boundaries and scope for reporting
Developing processes and controls for data collection
Accounting for complex operations
The potential reputational impact of public disclosure of energy use and carbon emissions
The entity may not be in line with acceptable practices/industry peers
Facing penalties from disclosing inaccurate results
Operational cost-savings through increasing awareness of energy use and efficiency
Differentiating from competitors by demonstrating best practice in energy savings and efficiency
Demonstrate improved performance year on year by establishing ongoing monitoring of energy use and carbon emissions

What you will need to do

Compliance with the reporting requirements can be complex and confusing, especially for companies reporting for the first time. SECR reporting also presents an opportunity for private companies to monitor their environmental performance and identify areas for improvement.

1. Establish reportable operations and the organisational boundaries
2. Set up an accounting and reporting framework
3. Report and disclose

1. Establish reportable operations and the organisational boundaries

Identify entities thatrequire reporting
Determine theorganisationalboundaries for eachscope of emissions
Understand how todeal with complexoperational activities

2. Set up an accounting and reporting framework

Understand datasources, process andcontrols to obtainrelevant information
Define a reportingprocess for carbon-related data and information
For more complexoperations, designreporting template

3. Report and disclose

Define internalgovernance forreporting
Review energyusage levels andemissionsconversion
Report in line withSECR requirements within the

Assist you with defining the reporting scope, including operational control and organisation boundaries
Review your processes, controls and data outputs to assess the accuracy and completeness of your carbon disclosures
Recommendations on best practice in monitoring and reporting operations