As of today (April 1), the first Streamlined Energy and Carbon Reporting (SECR) reports are due.
SECR was brought in last year to encourage groups of businesses that fulfil the specified criteria to become more energy efficient and reduce their carbon footprint.
It replaced the Carbon Reduction Commitment Energy Efficiency Scheme (CRC) with the aim of widening the net and bringing the benefits of carbon zero to more businesses.
The new regulations will require an estimated 11,900 companies incorporated in the UK to disclose their energy and carbon emissions – a far greater number than were required to act under the CRC.
Qualifying companies will need to include information on their UK energy use in line with the SECR framework in their Directors’ Report, or an equivalent Energy and Carbon Report for LLPs, for financial years beginning on or after 1 April 2019.
Where energy use and carbon emissions are considered to be of strategic importance to the organisation, the disclosure may be made in the Strategic Report instead, with a statement in the director’s report to indicate and explain this decision.
Who needs to comply?
Three groups of businesses are affected by the new regulations. Companies that fall within the following definitions must comply unless they meet certain exemption criteria:
- Quoted companies of any size that are already obliged to report under mandatory greenhouse gas reporting regulations.
- Unquoted companies incorporated in the UK that meet the definition of ‘large’ under the Companies Act 2006 will have new reporting obligations. This applies to registered and unregistered companies. Note that the criteria for ‘large’ differs from the ESOS Regulations.
- ‘Large’ Limited Liability Partnerships (LLPs) will be required to prepare and file a ‘Energy and Carbon Report’.
Unquoted companies or LLPs are defined as ‘large’ if they meet at least two of the following three criteria in a reporting year:
- a turnover of £36 million or more
- a balance sheet of £18 million or more or
- 250 employees or more.
Certain companies that would otherwise be eligible may be exempt if their energy use is low – 40MWh or less over the reporting period.
Whilst not a requirement, external verification or assurance is recommended as best practice to ensure the accuracy, completeness and consistency of data for both internal and external stakeholders.
Energy Management has a proven track record in ensuring companies are compliant with all the latest relevant industry legislation so if you want to find out more about your SECR requirements, you can contact us on 01225-867722 or email sales@energymanagementltd.com.
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