Hospitality Sector SECR: Hotels and Restaurants Compliance

The hospitality sector faces unique challenges when it comes to SECR (Streamlined Energy and Carbon Reporting) compliance. Unlike office-based businesses with straightforward electricity and heating profiles, hotels and restaurants operate energy-intensive facilities around the clock—commercial kitchens, refrigeration systems, laundries, swimming pools, air conditioning, and guest accommodations all contribute to complex emissions profiles.

If your hospitality business meets the SECR thresholds (50+ employees, £36M+ turnover, or £18M+ balance sheet), you're legally required to report your energy consumption and carbon emissions in your annual Directors' Report filed with Companies House. This comprehensive guide walks you through the specific challenges and solutions for hospitality SECR compliance.

Understanding SECR for Hospitality Businesses

Who Must Comply in the Hospitality Sector?

SECR applies to UK-incorporated companies and LLPs that meet two or more of these criteria:

• 50 or more employees
• Annual turnover of £36 million or more
• Annual balance sheet total of £18 million or more

This typically includes:

• Hotel groups operating multiple properties
• Large independent hotels (particularly 4-star and 5-star establishments)
• Restaurant chains with 10+ locations
• Pub groups and managed pub estates
• Contract catering companies serving corporate, education, or healthcare sectors
• Holiday parks and resort operators
• Event venues and conference centers

Even single-site operators can fall within scope if they employ 50+ staff and meet revenue thresholds—not uncommon for larger hotels or destination restaurants.

What Makes Hospitality SECR Complex?

Hospitality businesses face several unique complications:

1. Diverse energy end-uses: Unlike offices with mainly lighting and IT, hospitality uses energy for cooking, refrigeration, laundry, hot water, heating, cooling, and more
2. 24/7 operations: Hotels never close, creating continuous baseload energy demand
3. Seasonal variations: Summer cooling and winter heating create dramatic consumption swings
4. Mixed-use buildings: Hotels often combine accommodations, restaurants, spas, gyms, and conference facilities
5. Legacy buildings: Many hotels operate in older buildings with poor insulation and inefficient systems
6. Multiple meters: Larger properties may have separate meters for kitchens, guest rooms, back-of-house, and amenities

Despite these complexities, SECR compliance is entirely achievable once you understand the framework.

What Hospitality Businesses Must Report

SECR requires three core disclosures in your annual Directors' Report:

1. Total Energy Consumption (in kWh)

Report all energy consumed in your UK operations:

• Electricity: All metered electricity across your properties
• Natural gas: Heating, hot water, and cooking gas
• Other fuels: LPG, oil, coal (increasingly rare but still found in rural properties)
• Transport fuels: Company vehicles (delivery vans, shuttle buses, courtesy cars)

Important: If you operate both UK and international properties, only UK energy consumption must be reported under SECR. However, keep international data separate if you're also pursuing voluntary carbon certification (e.g., Green Tourism).

2. Greenhouse Gas Emissions (in tCO2e)

Calculate emissions using the official UK Government GHG Conversion Factors:

• Scope 1: Direct emissions from fuel combustion you control (gas boilers, cooking gas, company vehicles, on-site generators)
• Scope 2: Indirect emissions from purchased electricity

These conversion factors are updated annually and must be used for SECR compliance. They convert kWh of energy into kilograms of CO2 equivalent (kgCO2e), accounting for the carbon intensity of UK electricity generation and fuel combustion.

3. Intensity Ratio

Express your emissions relative to a meaningful business metric. For hospitality, appropriate intensity ratios include:

• Emissions per guest night (ideal for hotels)
• Emissions per cover served (appropriate for restaurants)
• Emissions per square meter (useful for mixed-use or comparing different property types)
• Emissions per £ revenue (enables cross-sector comparison)

Recommendation for hotels: Use emissions per guest night (or room night) as this normalizes for occupancy variations and allows year-on-year comparison even if your business grows or shrinks.

Recommendation for restaurants: Use emissions per cover served, as this reflects operational intensity regardless of revenue fluctuations.

Hospitality-Specific Emission Sources

Understanding your emissions profile helps prioritize energy efficiency investments and accurately complete SECR reporting.

Hotels: Typical Emissions Breakdown

Major sources (60-75% of total emissions):

1. Heating and hot water (30-40%)

   • Space heating (guest rooms, public areas, back-of-house)
   • Domestic hot water (showers, baths, taps, laundry)
   • Swimming pools and spa heating
   • Underfloor heating in bathrooms

2. Refrigeration and air conditioning (15-25%)

   • Kitchen cold storage (walk-in fridges and freezers)
   • Mini-bars in guest rooms
   • Air conditioning systems (particularly in summer)
   • Wine cellars and bar refrigeration

3. Catering and kitchen equipment (10-15%)

   • Cooking equipment (ovens, grills, fryers, ranges)
   • Dishwashers and glasswashers
   • Food preparation equipment
   • Extraction and ventilation

Secondary sources (25-40% of total emissions):

1. Lighting (8-12%)

   • Guest room lighting
   • Corridor and public area lighting
   • External lighting and signage
   • Emergency lighting

2. Laundry (5-10%)

   • Washing machines (sheets, towels, tablecloths)
   • Tumble dryers
   • Ironing and pressing equipment
   • Hot water for laundry

3. Other amenities (5-10%)

   • Gym equipment
   • Lifts and escalators
   • Entertainment systems (TVs, audio systems)
   • IT infrastructure and guest Wi-Fi
   • Electric vehicle charging points (if provided)

Restaurants: Typical Emissions Breakdown

Major sources (70-85% of total emissions):

1. Cooking equipment (35-45%)

   • Gas or electric ranges and ovens
   • Grills and chargrills
   • Fryers (particularly energy-intensive)
   • Specialist equipment (pizza ovens, tandoors, woks)

2. Refrigeration (20-30%)

   • Walk-in fridges and freezers
   • Under-counter refrigeration
   • Display fridges (salads, desserts, drinks)
   • Ice machines

3. Ventilation and extraction (8-12%)

   • Kitchen extraction hoods
   • Make-up air systems
   • Grease filtration
   • Air conditioning for dining areas

Secondary sources (15-30% of total emissions):

1. Hot water and dishwashing (7-10%)

   • Commercial dishwashers
   • Glasswashers
   • Hand washing facilities
   • Cleaning

2. Heating and cooling (5-8%)

   • Space heating for dining areas
   • Air conditioning (summer months)
   • Patio heaters (outdoor dining)

3. Lighting and other (3-7%)

   • Dining area ambiance lighting
   • Kitchen task lighting
   • External signage
   • POS systems and IT

Pubs: Typical Emissions Breakdown

Pub emissions depend heavily on the food offer—wet-led pubs (drinks focus) have different profiles than food-led pub-restaurants.

Wet-led pubs:

• Refrigeration (beer coolers, glass-fronted fridges): 35-45%
• Heating: 25-35%
• Lighting: 15-20%
• Catering equipment (if kitchen): 10-15%

Food-led pubs:

• Similar profile to restaurants with higher heating component due to larger public areas

Step-by-Step SECR Compliance for Hospitality

Step 1: Identify All Energy Meters and Accounts

Hospitality properties often have multiple energy supply points:

• Separate meters for different parts of the building (e.g., hotel may have one meter for guest rooms, another for kitchens, another for laundry)
• Multiple suppliers (especially if you've switched during the year)
• Sub-meters for specific departments (useful for internal cost allocation)

Action: Create a master list of all meters, account numbers, and suppliers for each property in your group.

Multi-site operators: Assign a local contact at each property responsible for gathering bills—facilities managers or general managers work well.

Step 2: Collect 12 Months of Energy Bills

You need a full year of consumption data covering your financial reporting period.

Gather:

• All electricity bills (monthly or quarterly depending on your billing cycle)
• All gas bills
• Any oil, LPG, or alternative fuel delivery records
• Fuel receipts for company vehicles (if applicable)

Common hospitality billing challenges:

• Estimated vs. actual readings: Energy suppliers often estimate consumption between actual meter reads. Where possible, ensure your final bill for the reporting period is based on actual readings, or obtain actual reads from your supplier.
• Seasonal billing cycles: Some suppliers issue quarterly bills that don't align with your financial year—you may need to pro-rate consumption or request meter reads for your specific year-end date.
• Property management companies: If a management company handles your utilities, request consumption data from them with plenty of lead time (6-8 weeks before your accounts deadline).

Step 3: Extract and Sum Total Consumption

From each bill, extract:

• Billing period dates
• Total kWh consumed
• Fuel type

Sum all consumption for the 12-month reporting period:

Total electricity: _____ kWh
Total natural gas: _____ kWh
Total other fuels: _____ kWh (converted to kWh if delivered in litres or kg)
Total transport fuels: _____ kWh

Multi-property groups: Create a spreadsheet with one row per property, summing to group totals.

Step 4: Apply UK Government Conversion Factors

Download the latest UK Government GHG Conversion Factors (updated every June for the following reporting year).

Key conversion factors for hospitality (2025 values):

• Grid electricity: 0.193 kgCO2e/kWh (Scope 2)
• Natural gas: 0.203 kgCO2e/kWh (Scope 1)
• LPG: 0.241 kgCO2e/kWh (Scope 1)
• Heating oil: 0.298 kgCO2e/kWh (Scope 1)

Calculation example for a hotel group:

Annual electricity (all properties): 2,400,000 kWh
× 0.193 kgCO2e/kWh
= 463,200 kg CO2e
= 463.2 tonnes CO2e (Scope 2)

Annual gas (all properties): 1,800,000 kWh
× 0.203 kgCO2e/kWh
= 365,400 kg CO2e
= 365.4 tonnes CO2e (Scope 1)

Total emissions: 828.6 tonnes CO2e

Step 5: Calculate Your Intensity Ratio

Example for hotel:

Total emissions: 828.6 tonnes CO2e
÷ Total guest nights: 185,000
= 0.0045 tonnes CO2e per guest night
= 4.5 kg CO2e per guest night

This intensity metric allows you to track efficiency improvements year-over-year, even as occupancy and property count change.

Example for restaurant:

Total emissions: 142.3 tonnes CO2e
÷ Total covers served: 98,000
= 0.0015 tonnes CO2e per cover
= 1.5 kg CO2e per cover

Step 6: Document Energy Efficiency Actions

SECR requires you to describe energy efficiency measures undertaken during the reporting period. This doesn't need to be extensive, but must demonstrate active energy management.

Examples for hotels:

• "Replaced guest room lighting with LED bulbs across all 150 rooms, reducing lighting energy by 60%"
• "Installed smart thermostats in 40% of rooms, enabling automatic temperature reduction when rooms are unoccupied"
• "Upgraded pool heating system from oil-fired boiler to air-source heat pump, reducing heating emissions by 35%"
• "Implemented linen reuse program, reducing laundry loads by 20% and associated energy consumption"
• "Replaced legacy kitchen refrigeration units with A+ rated equipment, cutting cold storage energy use by 25%"

Examples for restaurants:

• "Installed demand-controlled kitchen ventilation that adjusts extraction rates based on cooking activity, reducing fan energy by 30%"
• "Replaced gas deep-fat fryers with high-efficiency induction models"
• "Upgraded to Energy Star-rated commercial dishwashers with heat recovery"
• "Implemented staff training on switching off equipment during quiet periods"

Even small actions count: If you haven't undertaken major capital projects, document behavioral changes, monitoring improvements, or maintenance practices that improve efficiency.

Common SECR Challenges in Hospitality

Challenge 1: Mixed-Use Buildings

Problem: A hotel might include accommodation, a restaurant open to the public, a spa, gym, and conference facilities. How do you allocate emissions?

Solution for SECR: You don't need to. SECR requires total emissions across your UK operations—internal allocation is optional. Report whole-building consumption and emissions.

However, if you want to understand emissions by department for management purposes, you can:

• Use sub-meter data where available
• Allocate based on floor area or revenue contribution
• Benchmark individual components against sector norms (e.g., guest rooms typically account for 40-50% of hotel emissions)

Challenge 2: Franchise vs. Owned Properties

Problem: Hotel groups often have a mix of owned properties and franchised operations. What's included in SECR?

Solution:

• Include: All properties you own and operate (full financial and operational control)
• Include: Properties you operate under management contracts where you control energy procurement
• Exclude: Franchised properties where the franchisee controls operations and energy procurement (they report SECR separately if they meet thresholds)

This aligns with GHG Protocol's operational control boundary approach.

Challenge 3: Refrigerant Leakage

Problem: Commercial refrigeration and air conditioning systems use refrigerant gases (HFCs) which are potent greenhouse gases. If these leak, should they be reported in SECR?

Solution: Refrigerant leakage is not required under SECR, which covers only energy consumption-related emissions (Scope 1 and 2). However:

• Under the F-Gas Regulations, you must keep records of refrigerant leaks
• Many hospitality businesses voluntarily report refrigerant emissions as additional Scope 1
• If you're pursuing broader carbon neutrality goals, include refrigerant leakage

Challenge 4: Seasonal Variations

Problem: Hotels and holiday venues experience dramatic seasonal energy variations (high winter heating, high summer cooling, peak occupancy periods).

Solution:

• Always report a full 12-month period to capture seasonal cycles
• Choose your intensity ratio carefully—emissions per guest night normalizes for occupancy swings
• In your narrative, explain any unusual factors: "Emissions per guest night increased 8% due to colder winter requiring additional heating despite improved insulation"

Challenge 5: On-Site Renewable Generation

Problem: Some hospitality businesses have installed solar panels or other on-site renewable generation. How is this accounted for?

Solution:

• Electricity consumption: Report only grid electricity you purchase (metered import)
• On-site generation: SECR doesn't require you to report self-generated renewable energy, but you may voluntarily disclose it
• Future-proofing: Keep records of on-site generation as future regulations may require net energy reporting

Example disclosure: "The company installed a 50kW solar PV array generating approximately 45,000 kWh annually, offsetting 12% of our electricity consumption. Grid electricity consumption reported under SECR reflects net import after accounting for on-site generation."

Energy Efficiency Strategies for Hospitality

Meeting SECR is the baseline. Leading hospitality businesses are going further, using carbon reporting as a springboard for cost-saving energy efficiency improvements.

Quick Wins (payback < 2 years)

LED lighting upgrades:

• Replace all halogen and incandescent bulbs with LEDs
• Typical savings: 60-80% on lighting energy
• Enhanced guest experience through better quality, dimmable lighting

Smart controls:

• Guest room occupancy sensors and smart thermostats
• Automatic shutdown of HVAC when rooms are unoccupied
• Typical savings: 15-20% on guest room heating/cooling

Kitchen equipment audits:

• Replace pilot lights with electronic ignition (gas savings)
• Install time controls on extraction hoods (reduce run-time during closed hours)
• Upgrade to induction cooking where feasible (70% more efficient than gas)

Refrigeration maintenance:

• Regular condenser coil cleaning (improves efficiency by 10-15%)
• Door seals inspection and replacement
• Temperature optimization (many fridges run colder than necessary)

Medium-Term Investments (payback 2-5 years)

Building fabric improvements:

• Improved insulation (lofts, walls, pipework)
• Double or triple glazing
• Draught-proofing

Heat recovery systems:

• Kitchen extraction heat recovery (reclaim waste heat from cooking)
• Laundry heat recovery (reuse heat from wastewater)
• Swimming pool heat recovery from ventilation

Hot water system upgrades:

• Condensing boilers (90%+ efficiency vs. 70% for older models)
• Solar thermal for hot water pre-heating
• Point-of-use water heaters (reduce heat loss from long pipe runs)

Long-Term Strategies (payback 5+ years)

Renewable energy:

• Solar PV (rooftop or car park installations)
• Ground-source or air-source heat pumps
• Biomass boilers (for rural properties with space)

Major HVAC upgrades:

• Variable refrigerant flow (VRF) systems
• Combined heat and power (CHP) for larger properties
• District heating connections where available

Digital energy management:

• Building management systems (BMS) with real-time monitoring
• AI-driven predictive controls
• Guest-facing energy dashboards (appeals to eco-conscious travelers)

Hospitality Sector Benchmarks

Understanding typical emissions helps assess your performance and identify improvement opportunities.

Hotels (per guest night)

• Budget hotels (limited service): 5-10 kg CO2e per guest night
• Mid-market hotels (3-star): 10-18 kg CO2e per guest night
• Upscale hotels (4-star): 18-30 kg CO2e per guest night
• Luxury hotels (5-star, spa, extensive amenities): 30-50+ kg CO2e per guest night

Higher-category hotels have greater emissions due to larger rooms, more amenities, higher guest expectations (temperature, hot water), spas, pools, and enhanced services.

Restaurants (per cover)

• Quick service: 0.8-1.2 kg CO2e per cover
• Casual dining: 1.2-2.0 kg CO2e per cover
• Fine dining: 2.0-3.5 kg CO2e per cover

Fine dining has higher emissions due to complex cooking techniques, longer service times (higher HVAC), and more intensive refrigeration (fresh ingredients, wine cellars).

Pubs

• Wet-led pubs: 8-15 kg CO2e per square meter per year
• Food-led pubs: 20-35 kg CO2e per square meter per year

These benchmarks help contextualize your performance. If you're significantly above sector norms, investigate root causes (older buildings, inefficient equipment, operational practices).

Outsourcing vs. In-House SECR for Hospitality

Hospitality businesses have three main options for SECR compliance:

Option 1: Environmental Consultants

Cost: £15,000 - £30,000 (higher for multi-property groups) Timeline: 8-12 weeks Pros: Expert guidance, bespoke analysis, strategic recommendations Cons: Expensive, slow, recurring annual costs

Best suited for very large hotel groups with complex operations or those seeking comprehensive carbon management beyond SECR compliance.

Option 2: In-House Compliance

Cost: Internal staff time Timeline: 3-6 weeks (if experienced) Pros: Free (no external fees), builds internal capability Cons: Time-consuming, risk of errors, diverts operational focus

Feasible for businesses with dedicated sustainability or facilities teams, but most hospitality operators lack the internal expertise and find this approach frustrating.

Option 3: Automated Platforms

Cost: £1,999 (Comply Carbon) Timeline: 10 minutes to upload bills, instant report Pros: Fast, affordable, accurate, zero errors in calculations Cons: Less bespoke advice than consultants (though sufficient for compliance)

For most hospitality businesses, automated platforms offer the optimal balance. You upload energy bills, AI extracts consumption data, official conversion factors are applied automatically, and you receive a compliant SECR disclosure ready for your Directors' Report.

Particularly valuable for multi-site hospitality groups: Upload bills from all properties in one session, and the platform aggregates everything automatically.

Case Study: Regional Hotel Group

Business profile: 4 hotels across the UK, 275 total employees, £58M turnover, mix of 3-star and 4-star properties

SECR challenge: First year of compliance, diverse property portfolio (modern builds and historic buildings), no prior carbon reporting experience

Approach: Used Comply Carbon automated platform

Process:

1. Facilities managers at each hotel gathered 12 months of energy bills (electricity and gas)
2. Uploaded 96 bills total (4 properties × 12 months × 2 fuel types) in under 10 minutes
3. Platform automatically extracted consumption data and calculated emissions

Results:

• Total emissions: 1,247 tonnes CO2e
• Intensity ratio: 6.8 kg CO2e per guest night (184,000 guest nights across the group)
• Breakdown: 58% electricity, 42% gas
• Generated compliant SECR disclosure including energy efficiency narrative
• Cost: £1,999 (saved ~£20,000 vs. consultant quotes)
• Time: 10 minutes vs. estimated 10-12 weeks with traditional approach

Operations Director feedback: "We were concerned SECR would be complicated given our mix of properties. Comply Carbon handled everything seamlessly. The intensity ratio per guest night will be our key metric going forward—it's already helping us identify our least efficient properties for targeted investment."

Preparing for Evolving Hospitality Sustainability Requirements

SECR is the legal baseline, but the hospitality sector faces growing sustainability expectations from customers, investors, and regulators.

Guest Expectations

Surveys consistently show that:

• 65%+ of travelers consider environmental impact when choosing accommodations
• Younger demographics (millennials and Gen Z) especially prioritize sustainability
• Transparent carbon reporting enhances brand reputation

Forward-thinking hospitality businesses are publishing carbon footprints on websites and marketing their intensity metrics ("our carbon footprint is 30% below industry average per guest night").

Industry Certifications

SECR compliance is foundational for pursuing voluntary hospitality certifications:

• Green Tourism (UK-focused sustainability certification)
• Green Key (international eco-label for hospitality)
• EarthCheck (science-based certification)
• B Corp (increasingly popular among boutique hotels and restaurant groups)

All require carbon footprinting, making SECR data directly applicable.

TCFD and Expanded Climate Disclosure

Larger hospitality groups (500+ employees, £500M+ turnover) must comply with TCFD (Task Force on Climate-related Financial Disclosures), which requires:

• Climate risk assessment (physical risks like flooding, heatwaves; transition risks like carbon pricing)
• Scenario analysis
• Governance and strategy disclosure

Getting SECR right now builds the foundation for TCFD when your business crosses those thresholds.

Scope 3 Emissions

SECR only covers Scope 1 and 2 (direct and purchased electricity). But comprehensive carbon footprinting includes Scope 3:

• Food and beverage procurement (often 40-60% of a hotel or restaurant's full carbon footprint)
• Waste disposal
• Business travel and staff commuting
• Construction and renovations
• Purchased goods (linens, toiletries, cleaning supplies)

Leading hospitality brands are voluntarily measuring Scope 3 to understand their full impact and implement farm-to-table sourcing, waste reduction, and sustainable procurement.

Key Takeaways for Hospitality Businesses

• SECR applies to hotel groups, restaurant chains, and large hospitality operators (50+ employees, £36M+ turnover, or £18M+ balance sheet)
• Hospitality has complex emissions profiles: kitchens, refrigeration, laundry, HVAC, and 24/7 operations create diverse energy use
• Choose the right intensity ratio: emissions per guest night for hotels, emissions per cover for restaurants
• Energy efficiency pays back quickly: LED lighting, smart controls, kitchen equipment upgrades typically recoup investment in under 2 years
• Seasonal variations are normal: report a full 12-month period and use intensity ratios to normalize
• Automated platforms save time and money: upload bills, get compliant reports instantly for £1,999 vs. £15-30k for consultants

Next Steps for Hospitality SECR Compliance

Ready to tackle your SECR obligations without consultant fees and months of waiting?

1. Confirm your requirements: Use the Comply Carbon compliance checker to verify whether SECR applies
2. Gather energy bills: Collect 12 months of electricity and gas bills for all UK properties
3. See what you'll get: Review our sample SECR report to see the final disclosure format
4. Get compliant in 10 minutes: Upload your bills to Comply Carbon for instant automated SECR reporting

For detailed general SECR guidance, see our comprehensive SECR Guide.

About Comply Carbon: We're the UK's leading automated SECR compliance platform, serving 200+ companies including hotels, restaurant groups, and hospitality businesses. Our AI-powered platform uses official UK Government conversion factors and maintains a 100% Companies House acceptance rate. Hospitality clients save an average of £18,000 compared to traditional environmental consultants—and get their reports in minutes, not months.