SECR compliance

The Streamlined Energy and Carbon Reporting (SECR) is a regulatory framework introduced in the UK to increase awareness and transparency of energy usage and carbon emissions among businesses. SECR requires large companies to report their annual energy use, greenhouse gas emissions, and related energy efficiency actions within their annual reports. Pilio’s energy and carbon software plus consultancy supports organisations to take proactive steps towards improving energy efficiency and reducing carbon footprints, ultimately contributing to the UK's overall climate objectives.

What is SECR?

Streamlined Energy and Carbon Reporting (SECR) requires companies to report information on greenhouse gas (GHG) emissions in their Directors’ Reports. SECR requires you report Scope 1 and 2 emissions and encourages Scope 3 reporting. 

The guidelines demand carbon emissions accounting from buildings, fuel and electricity and for a performance indicator of carbon intensity, i.e. kg CO2e per £ revenue or kg CO2e per employee.

Key aspects of SECR include:

  • Scope: It applies to large UK-incorporated companies and LLPs that meet at least two of the following criteria:

    • At least 250 employees

    • Annual turnover greater than £36 million

    • An annual balance sheet total greater than £18 million

  • Reporting Requirements: Companies must include details on their energy use, carbon emissions, and energy efficiency measures in their directors' reports. This includes:

    • Energy consumption from electricity, gas, and transport

    • Scope 1 and Scope 2 emissions

    • At least one intensity ratio (e.g., emissions per unit of production or per employee)

    • Methodologies used for calculations

  • Exemptions: There are certain exemptions for low-energy users (those who consume 40,000 kWh or less over the reporting period), and specific requirements for different sectors and types of organizations.

  • Objectives: SECR aims to:

    • Improve transparency and accountability regarding energy use and carbon emissions

    • Encourage companies to implement energy efficiency measures

    • Provide stakeholders with better information on environmental performance

  • By adhering to SECR requirements, companies can demonstrate their commitment to sustainability, potentially improving their reputation and operational efficiency while contributing to the broader effort to combat climate change.

What is the compliance period for SECR?

The compliance period for SECR (Streamlined Energy and Carbon Reporting) aligns with a company's financial year. Companies are required to include their SECR report within their annual financial reports, which means they must collect and report on their energy use and carbon emissions data for each financial year. The SECR requirements apply to financial years starting on or after April 1, 2019.

Key Points on Compliance Period:

  • Annual Reporting: SECR reporting is an annual requirement, coinciding with the company's financial reporting period.

  • Financial Year Alignment: Companies must report their SECR data for the same 12-month period as their financial statements.

  • Submission Deadlines: The SECR information should be included in the directors' report section of the company's annual accounts, which are typically due nine months after the end of the financial year for private companies and six months for public companies.

  • Start Date: The reporting obligation commenced for financial years starting on or after April 1, 2019.

Example:

- If a company’s financial year runs from January 1 to December 31, their SECR report for the 2023 financial year would cover January 1, 2023, to December 31, 2023, and be included in the annual report due by September 30, 2024 (for private companies).

By adhering to these timelines, companies ensure they remain compliant with SECR regulations and contribute to increased transparency and accountability in energy use and carbon emissions reporting.

What will you get from working with Pilio?

  • A report and presentation to share with key decision-makers

  • Suggested next steps for reducing impacts on your supply chain

  • Guidance and resources for engaging with your suppliers on sustainability

  • Access to Pilio’s supply chain software tools for ongoing measurement and management of procurement environmental impacts

Pilio has performed Scope 3 audits for businesses including YMCA, Lush, and Arts Council England.