Stockport-based accountancy firm and business advisor, Hallidays, explains the basic requirements businesses need to know when reporting their environmental impact under new SECR rules.
The Streamlined Energy and Carbon Reporting (SECR) affects all large UK undertakings.
Introduced in April 2019, SECR replaces several programmes that covered energy and carbon and taxation and builds on existing requirements to raise awareness of energy efficiency, reduce bills and save carbon.
The new rules affect three groups of businesses; Quoted, Unquoted and Large ‘Limited Liability Partnerships’ (LLP) who meet at least two of the following criteria:
- More than 250 employees
- Annual turnover greater than £36m
- Annual balance sheet total greater than £18m
There are some exclusions for organisations within these and other energy-based criteria.
How does SECR work?
From April 2019, all qualifying companies must disclose their energy and carbon emissions in their annual financial reports, along with efficiency measures taken over the previous year. This involves the collection and reporting of data regarding energy use, emissions and the production of an energy efficiency action plan.
Qualifying businesses will now be at one of three stages with their submission, depending on their year-end:
- Some have submitted
- Some are in the process of compiling annual accounts (e.g. if financial year ran Jan 2020 to Dec 2021 and then they have 9 months after to submit, they are still compiling their first SECR report)
- Some have not complied and need to make their submission
What must be reported?
- UK energy use for electricity, gas & transport
- Associated greenhouse gas (GHG) emissions
- Energy use and GHG emissions from previous year
- At least one emissions intensity (carbon intensity) ratio (this is the emission rate of a given pollutant relative to the intensity of a specific activity/industrial process)
- Narrative on energy efficiency measures and methodology
The reports should be completed annually, the same as the company’s financial year and be included in your company’s Directors Report.