Understanding SECR Regulations and the Impact on Businesses

Organisations should be familiarising themselves and complying with Government regulations. Particularly, larger organisations should be well prepared to report in line with the Streamlined Energy and Carbon Reporting (SECR) regulations. Our article will help you understand what to expect from SECR and the impact it can have on businesses that comply.

In April 2019, the UK government introduced the Streamlined Energy and Carbon Reporting (SECR) regulations. These regulations aim to increase corporate transparency in energy and carbon reporting, encouraging businesses to become more energy efficient and reduce their carbon footprint. This initiative supports broader environmental goals, including those outlined in the Paris Agreement.


  • Quoted Companies: These are companies listed on main markets such as the London Stock Exchange. They must report their global energy use and greenhouse gas (GHG) emissions.
  • Large Unquoted Companies: These are companies that meet at least two of the following criteria: more than 250 employees, an annual turnover exceeding £36 million, or an annual balance sheet total exceeding £18 million. These companies must report their UK energy use and associated GHG emissions.
  • Large Limited Liability Partnerships (LLPs): LLPs that meet the criteria for large unquoted companies must also comply with SECR.

Reporting requirements

  • Energy Use: This includes electricity, gas, and transport energy consumption.
  • GHG Emissions: Emissions must be reported in tonnes of CO2 equivalent (CO2e).
  • Energy Efficiency Actions: Companies must detail the principal measures they have taken to improve energy efficiency during the reporting period.
  • Methodologies: Companies need to disclose the methods used to calculate energy and emissions data.
  • Intensity Ratios: At least one intensity ratio, such as emissions per unit of turnover or production, must be provided to contextualise the data.

Impact on Businesses

Investment in Systems and Processes: Companies need to set up systems to measure and report energy use and emissions accurately. This might involve upgrading IT systems, training staff, and hiring external consultants. As well as, continuous monitoring and thorough documentation are required, which can increase administrative tasks.

Costs and Benefits: While compliance can be costly, there are potential financial benefits. Improved energy efficiency can lead to significant savings on energy bills and sustainable businesses tend to have a competitive advantage over their industry peers, driving revenue growth. Also, enhanced transparency can improve investor confidence, potentially leading to better financing terms or investment opportunities.

Adoption of New Technologies: Businesses may need to adopt new technologies or modify operational practices to enhance energy efficiency. SECR encourages companies to integrate sustainability into their core strategies, which can lead to innovative products and services.

Better risk management: SECR reporting aids companies in identifying and managing risks linked to energy use and carbon emissions. By gaining insight into their energy consumption and carbon footprint, companies can make well-informed decisions regarding energy-related risks and opportunities.

Enhanced Reputation: Companies that excel in energy efficiency and carbon management can improve their reputation with customers, investors, and other stakeholders. Also, failure to comply or poor performance can result in a public censure issued by The Conduct Committee of the Financial Reporting Council (FRC), damaging a company’s reputation. Non-complying companies can also face civil penalties of up to £50,000.

Contribution to National and Global Goals: SECR aims to reduce overall GHG emissions by promoting greater awareness and accountability. Companies play a crucial role in mitigating climate change by adopting greener practices and reporting their progress transparently.

To conclude, SECR regulations are a significant step towards greater corporate responsibility in energy use and carbon emissions. For businesses, compliance is not just a legal obligation but also an opportunity to improve efficiency, reduce costs, and enhance their market reputation. By embracing SECR, companies can contribute to a more sustainable future while potentially gaining competitive advantages in an increasingly eco-conscious market.

Ready to get started with SECR compliance? Positive Planet can provide the support and expertise you need. Contact us today to ensure your business meets SECR requirements efficiently and effectively. Let us help you achieve your sustainability goals and improve your bottom line.

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