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A simple guide to Streamlined Energy and Carbon Reporting (SECR)

Updated: Sep 30, 2024

According to the most recent estimate by the Department for Business, Energy and Industrial Strategy (BEIS), 11,300 UK businesses are now in the scope of SECR. In this article, we present a simple guide to SECR; what it is, who it’s applicable to, and how to ensure compliance. 


Person creating an SECR - Streamlined Energy and Carbon Reporting - submission

What is SECR?

The UK Government’s Streamlined Energy and Carbon Reporting (SECR) is a mandatory scheme for large UK companies to publicly report on their UK energy use and carbon emissions. 

What businesses have to comply with SECR?

From financial years beginning on or after 1st April 2019, all large UK companies are required to produce an SECR report. 


SECR is mandatory for all quoted companies; those that are listed on the stock exchange. 

 

SECR also applies to any company, LLP or group that the Companies Act 2006 defines as a “large company”, exceeding at least two of the following three thresholds in the financial year:


  • £36m annual turnover

  • £18m balance sheet total

  • 250 employees

Where do I have to report on my organisation’s energy use and carbon emissions?

SECR requires that large companies publish their SECR report within their Director’s Report to Companies House.

What date range should we use to report on our carbon emissions and UK energy use?

The SECR guidelines recommend that businesses report on their UK energy consumption and carbon emissions in line with their financial year. This allows for carbon emissions to be compared directly against business activity, and aids comparability and consistency of information across reports and organisations.

How will SECR help my organisation to reduce its carbon emissions?

The intention of SECR was to help large companies to reduce their carbon emissions by making them more aware of what they emit and why. 


Organisations that want to take serious steps towards reaching net zero emissions will need to go further than submitting an SECR report, but it is a solid first step. Once an SECR report has been created, an organisation can then establish a robust decarbonisation plan that first targets the operational areas that are associated with the greatest GHG emissions.

What are the reporting requirements for SECR?

The SECR requirements vary depending on the type of company. 


Quoted companies must calculate and report on all of the greenhouse gas (GHG) emissions the company is responsible for, globally. They must also report the underlying energy use that resulted in those GHG emissions, including combustion of fuel, operation of any facility, and the purchase of electricity, heat, steam or cooling for the company’s own purposes. 


Large unquoted companies and LLPs only have to report on their UK energy use and associated emissions, as a minimum including gas, electricity and transport (including UK offshore area).


All companies must also include:


  • The previous year’s figures for energy use and GHG emissions

  • At least one intensity ratio (to show how their emissions relate to their business activity, e.g. tonnes of CO2e per £m net turnover) 

  • The action(s) they are taking to reduce their energy use and carbon emissions

  • The methodology used in creating the report

Which scopes of our organisational carbon footprint are included in SECR?

Both quoted and large unquoted companies are currently only mandated to report on their Scope 1 and 2 emissions, as per the above reporting requirements. 


While Scope 3 is voluntary, it is encouraged that organisations identify their greatest sources of Scope 3 emissions and report on those, helping you to set realistic carbon reduction goals and to work towards net zero, by first accurately quantifying the scale of these emissions.

What transport-related energy use and activity must I include in our SECR report?

Your calculation of energy consumption and associated GHG emissions related to transport should include the following:


  • Any business-related mileage claims in company-owned or leased vehicles 

  • Fuel used in company cars for business use

  • Fuel used in commercial fleet vehicles which you operate 

  • Fuel used in personal cars for business use (including business mileage claims)

  • Fuel used in aircraft, trains, ships, or other infrastructure which you operate

  • Onsite vehicles and plant equipment, including fork-lift trucks and front-loaders


Commuting to work does not fall under the remit of SECR, but you can choose to report on it as voluntary Scope 3 emissions, if they are significant to your total carbon footprint. Equally, it is not mandatory to report on fuel related to business travel in trains, planes, taxis, or other vehicles that the company doesn’t operate, or on fuel combusted for the transport of goods and services in vehicles that the company doesn’t operate. 


However, if any of these Scope 3 emissions are significant, it is encouraged that you measure and report on them so that you can create a plan to reduce them. 

What is the purpose of the intensity ratio?

Reporting on your total carbon dioxide-equivalent emissions against a relevant business activity metric allows for comparison of carbon intensity and energy efficiency performance within your own organisation over time, and against other similar types of organisations.


Organisations should aim to select an intensity ratio that is most appropriate to their business activity and meaningful to stakeholders. For a manufacturing company, that might be tCO2e per mt of production, while for a facilities management company it might be tCO2e per £m net turnover. The intensity ratio should be used consistently each year to allow for annual comparison, and the chosen metric and method of calculation should be disclosed clearly in the report.

Which greenhouse gases must we report on?

Seven greenhouse gases together contribute towards climate change. All seven gases must be included in your SECR submission, in tonnes of carbon dioxide equivalent (CO2e), weighted for their 100-year global warming potential value:


  • Carbon dioxide (CO2)

  • Methane (CH4)

  • Nitrous oxide (N2O)

  • Hydrofluorocarbons (HFCs)

  • Perfluorocarbons (PFCs)

  • Sulphur hexafluoride (SF6)

  • Nitrogen trifluoride (NF3)

What steps should I take to ensure our SECR submission is compliant?

There are three main steps that organisations should take to ensure they report in line with SECR requirements:


  1. Establish your organisational boundaries and reportable organisations: You can choose to define your organisational boundaries based on financial control, operational control, or equity share. Identify the entities within your business that require reporting for each scope of emissions. 

  2. Set up an accounting and reporting template: Understand your data sources, processes and controls, in order to obtain relevant information, then define a reporting process for carbon-related data and information.

  3. Report and disclose: Review energy usage across all reportable entities and convert this to each GHG using the appropriate emission factors, then report in line with SECR guidance, defining the methodology used in calculating your GHG emissions.



Need help to create your SECR report? 

We can manage every step of the reporting process, helping you to define your scope, then measuring and reporting on your organisation’s energy use and emissions. We’ll give you confidence in the accuracy and compliance of your SECR reporting, while helping you establish the actions that will take you on a path towards net zero emissions. 






 

 
 
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