Streamlined Energy & Carbon Reporting

Ensuring your compliance with the new reporting requirements

From financial years beginning on or after 1 April 2019, large UK companies will be required to report publicly on their UK energy use and carbon emissions within their Directors’ Report. This new requirement has been implemented by the Department for Business, Energy and Industrial Strategy (BEIS).

SECR will impact any companies, LLPs and groups that exceed at least two of the following three thresholds in the preceding financial year:

  • £36m annual turnover
  • £18m balance sheet total
  • 250 employees

For businesses meeting the above criteria, company or group reporting is required regardless of whether an overseas parent company or group has published a similar report. A group may however exclude any energy and carbon information relating to any subsidiaries which would not be obliged to report individually according to the thresholds. After undertaking a calculation, where a company has consumed less than 40MWh, a disclosure is not required.

What needs to be reported?

UK (and UK offshore) energy use and related Scope 1 & 2 Greenhouse Gas (GHG) emissions. 

Scope 1 - Direct emissions

  • Fuel use from transport (where thejourney begins or ends in the UK)
  • Combustion of natural gas

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Scope 2 - Indirect emissions

  • Electricity purchased and used for operations (not including energy sold on)

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Scope 3 - Other indirect emissions

  • Energy use and related emissions from business travel in rental cars or employee owned vehicles where the company is responsible for purchasing the fuel

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Intensity metric for year-on-year

  • E.g. Tonnes of CO2e per FTE

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Supporting narrative

  • Methodologies used within the calculation
  • Energy efficiency action taken in the year

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Voluntary disclosures

  • Wider scope 1 emissions - including otherfuel use, refrigerants & manufacturing emissions
  • Scope 3 emissions - upstream and downstream energy use comparison

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What are the key challenges and opportunities?

  • Determining the operational boundaries and scope for reporting
  • Developing processes and controls for data collection
  • Accounting for complex operations
  • The potential reputational impact of public disclosure of energy use and carbon emissions
  • The entity may not be in line with acceptable practices/industry peers
  • Facing penalties from disclosing inaccurate results
  • Operational cost-savings through increasing awareness of energy use and efficiency
  • Differentiating from competitors by demonstrating best practice in energy savings and efficiency
  • Demonstrate improved performance year on year by establishing ongoing monitoring of energy use and carbon emissions

What you will need to do

Compliance with the reporting requirements can be complex and confusing, especially for companies reporting for the first time. SECR reporting also presents an opportunity for private companies to monitor their environmental performance and identify areas for improvement.

1. Establish reportable operations and the organisational boundaries

  • Identify entities thatrequire reporting
  • Determine theorganisationalboundaries for eachscope of emissions
  • Understand how todeal with complexoperational activities

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2. Set up an accounting and reporting framework

  • Understand datasources, process andcontrols to obtainrelevant information
  • Define a reportingprocess for carbon-related data and information
  • For more complexoperations, designreporting template

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3. Report and disclose

  • Define internalgovernance forreporting
  • Review energyusage levels andemissionsconversion
  • Report in line withSECR requirements within the

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How we can help you

  • Assist you with defining the reporting scope, including operational control and organisation boundaries
  • Review your processes, controls and data outputs to assess the accuracy and completeness of your carbon disclosures
  • Recommendations on best practice in monitoring and reporting operations

  • Review your reporting set up and outputs
  • Provide independent assurance over your carbon reporting and disclosure in your Annual Report

What you gain

  • Accurate, compliant reporting
  • Accelerate delivery; efficient reporting
  • Increased stakeholder trust and confidence

Contact us

Dan Pearson

Dan Pearson

Director, PwC United Kingdom

Tel: +44 (0) 7730146807

William Jones

William Jones

Manager, PwC United Kingdom

Tel: +44 (0)7843 371729

Cynthia Yap

Cynthia Yap

Manager, PwC United Kingdom

Tel: +44 (0)7702 697909

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