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Streamlined Energy and Carbon Reporting (SECR) - The lowdown

The Streamlined Energy and Carbon Reporting (SECR) legislation, introduced in 2019, aims to enhance energy efficiency and bring visibility to carbon performance alongside financial performance reporting. This mandatory legislation replaced the Carbon Reduction Commitment (CRC) Scheme and applies to all quoted companies, large limited liability partnerships, and large UK incorporated unquoted companies.

Under SECR, obligated companies must report their energy consumption and associated greenhouse gas emissions annually to Companies House. This includes providing details on energy efficiency measures and emissions with reference to an intensity metric, such as tonnes of CO2e per £m sales revenue.

The goal is to drive the collective effort to decarbonise the UK power system and reduce the effects of climate change.

Currently, SECR includes scope 1 and 2 emissions, and emissions from grey fleet (scope 3), with reporting on the rest of scope 3 categories (value chain emissions) being voluntary. However, a recent UK consultation explored the possibility of strengthening the SECR framework to encourage businesses to consider their complete organisational footprint. Read more on this in our recent news story on the consultation.

Who is obligated?

SECR applies to:

  • All quoted companies (already reporting via Mandatory GHG reporting)
  • Large limited liability partnerships
  • Large UK incorporated unquoted companies

Compliance is based on organisation size rather than energy use. However, organisations meeting the qualification criteria but using less than 40,000 kWh per annum are exempt from reporting.

An organisation is considered large if it meets at least two of the following criteria:

  • 250 or more employees
  • Turnover exceeding £36 million
  • Balance sheet exceeding £18 million

Note: These thresholds differ from those used for ESOS qualification.

What do obligated companies have to do?

Unquoted Companies:

To comply with SECR, the following must be disclosed in the Directors Report for unquoted companies:

  • UK energy consumption: Electricity, gas, and transport (minimum)
  • Associated GHG emissions from these sources
  • At least one emissions intensity metric (e.g., tCO2e / £ turnover)
  • Emissions over time (previous year's data required, except for the first reporting year)
  • A narrative on energy efficiency actions undertaken

Quoted Companies:

Organisations already obligated under Mandatory GHG Reporting have been reporting global emissions and intensity metric since 2013. Quoted companies continue to be required to report their global GHG emissions. However, there is now an additional requirement to report on total global energy use and energy efficiency actions. Quoted companies must also report on the methodology used to calculate the data.

Quoted companies must include material emissions from processes for example emissions from chemical processes, such as CO2 emissions from cement manufacturing.

How Can Beyondly Help?

Ensuring compliance with SECR can be complex. All reported information must be fully auditable and based on evidential records, such as invoices. Using established methodologies like ISO 14064 and the GHG protocol can ensure reliable figures. Beyondly offers bespoke packages to reduce the administrative burden and cover all aspects of carbon reporting.

If your company may be affected by SECR and you need support to ensure compliance, contact our sustainability experts at 01756 794 951 or solutions@beyond.ly.