What is SECR Reporting? A Complete Guide for UK Businesses

Streamlined Energy and Carbon Reporting (SECR) has become a critical compliance requirement for thousands of UK businesses since its introduction in April 2019. If you're a finance director, company secretary, or business owner at a UK SMB, understanding SECR reporting is essential to avoid penalties and meet your legal obligations.

This comprehensive guide explains everything you need to know about SECR reporting, from who must comply to how to prepare and submit your report.

Understanding SECR: The Basics

Streamlined Energy and Carbon Reporting is a UK government framework that requires certain businesses to report their energy consumption and carbon emissions annually. The legislation replaced the Carbon Reduction Commitment (CRC) Energy Efficiency Scheme and consolidated several existing reporting requirements into a single, streamlined framework.

SECR was introduced through amendments to the Companies Act 2006 and applies to financial years starting on or after 1 April 2019. The framework is designed to encourage energy efficiency improvements while reducing the administrative burden of compliance.

What SECR Reporting Includes

Under SECR regulations, qualifying businesses must disclose:

• Annual energy consumption (measured in kilowatt-hours)
• Greenhouse gas emissions (measured in tonnes of CO2 equivalent)
• Energy efficiency actions taken during the reporting period
• At least one intensity ratio (emissions relative to a business metric like turnover or floor space)
• Methodology information explaining the calculation standards used

All of this information must be included in your company's Directors' Report as part of your annual financial statements filed with Companies House.

Who Must Comply with SECR Reporting?

SECR applies to three categories of UK businesses:

Quoted Companies

All UK companies with shares traded on regulated markets (London Stock Exchange, NYSE, NASDAQ, etc.) must comply with SECR, regardless of size. If you're a quoted company, you'll need to report on UK and global energy use.

Large Unquoted Companies and LLPs

Your business must comply if it meets at least two of these criteria:

• Annual turnover of £36 million or more
• Balance sheet total of £18 million or more
• 250 or more employees

These thresholds are assessed over two consecutive financial years. If your business exceeds two of these thresholds for two years running, you must begin SECR reporting.

Large LLPs (Limited Liability Partnerships)

The same thresholds apply to LLPs, with the balance sheet test replaced by gross assets of £18 million or more.

Not sure if your business qualifies? Use our free SECR compliance checker to find out in 60 seconds.

SECR Reporting Requirements: What You Need to Disclose

Let's break down exactly what information you must include in your SECR report.

1. Energy Consumption Data

You must report your total energy consumption in kilowatt-hours (kWh) for:

• Electricity used in your operations
• Gas consumption for heating and processes
• Transport fuels used in company vehicles

This includes energy from both UK and offshore operations, though low-energy use exemptions may apply (see below).

2. Greenhouse Gas Emissions

Report your emissions in tonnes of carbon dioxide equivalent (tCO2e) following the GHG Protocol Corporate Standard. You must include:

• Scope 1 emissions: Direct emissions from sources you own or control (company vehicles, gas boilers, etc.)
• Scope 2 emissions: Indirect emissions from purchased electricity, heat, or steam
• Scope 3 emissions: Optional but recommended (business travel, waste, supply chain)

All calculations must use the official UK Government GHG Conversion Factors published annually by DEFRA.

3. Intensity Ratio

You must calculate at least one intensity ratio that shows your emissions relative to a quantifiable business metric. Common intensity ratios include:

• Emissions per £ million turnover: tCO2e / revenue
• Emissions per employee: tCO2e / number of employees
• Emissions per square metre: tCO2e / floor space
• Emissions per product unit: tCO2e / units sold or manufactured

Choose a ratio that best reflects your business operations and allows year-on-year comparison.

4. Energy Efficiency Measures

Describe the principal measures taken during the reporting period to improve energy efficiency. This narrative section should cover:

• Equipment upgrades (LED lighting, efficient HVAC systems, etc.)
• Operational changes (remote working policies, building management systems)
• Renewable energy installations (solar panels, heat pumps)
• Employee engagement initiatives
• Transport fleet improvements

Be specific and quantify improvements where possible. If no actions were taken, you must state this explicitly.

5. Methodology Statement

Your report must explain:

• The reporting boundaries (which entities and operations are included)
• The calculation methodology (typically the GHG Protocol Corporate Standard)
• The emission factors used (typically UK Government conversion factors)
• Any estimation methods for missing data
• Reasons for any year-on-year changes in methodology

SECR Reporting Exemptions and Simplifications

Low Energy Use Exemption

If your total UK energy consumption is 40,000 kWh or less in the reporting period, you can claim a low energy use exemption. You must still include a statement in your Directors' Report confirming you qualify for this exemption.

To put this in perspective, 40,000 kWh is roughly equivalent to:

• A small office space of 200-300 square metres
• Annual energy use for 3-4 average UK homes
• Minimal company vehicle use (mostly employee-owned vehicles)

Offshore Exemptions

Companies with no UK energy consumption can claim an offshore exemption if all operations are conducted outside the UK.

First-Year Baseline

In your first year of SECR reporting, you don't need to provide comparative figures. This year establishes your baseline for future year-on-year comparisons.

SECR Reporting Deadlines and Filing

When to Report

SECR disclosure must be included in your Directors' Report within your annual accounts. The deadline depends on your company structure:

• Private companies: 9 months after financial year end
• Public companies: 6 months after financial year end

For example, if your financial year ends on 31 December 2025, a private company must file by 30 September 2026, while a public company must file by 30 June 2026.

Where to File

SECR reports are submitted to Companies House as part of your annual financial statements. The energy and carbon information must appear in the Directors' Report section of your accounts.

For quoted companies, the SECR disclosure must also appear in your annual report distributed to shareholders.

SECR Penalties and Enforcement

Non-compliance with SECR reporting carries significant risks:

Financial Penalties

Companies House can issue penalties for:

• Late filing: £150 to £7,500 depending on how late and company size
• Incomplete or inaccurate information: Potential unlimited fines upon prosecution

Reputational Risk

Failing to comply with SECR can damage your reputation with:

• Investors and shareholders who expect ESG compliance
• Customers increasingly choosing sustainable suppliers
• Employees who value working for responsible companies

Director Liability

Directors can be held personally liable for failure to ensure SECR compliance under the Companies Act 2006.

How to Prepare Your SECR Report: Step-by-Step

Step 1: Gather Energy Data

Collect 12 months of energy bills and fuel receipts covering:

• Electricity bills for all sites
• Gas bills for heating and processes
• Transport fuel receipts or mileage logs
• Any other energy sources (oil, LPG, biomass, etc.)

Step 2: Calculate Emissions

Convert energy consumption to emissions using the appropriate UK Government conversion factors. For each energy type, multiply:

Emissions (tCO2e) = Energy consumed (kWh) × Emission factor (kgCO2e/kWh) ÷ 1,000

Different conversion factors apply to electricity, natural gas, diesel, petrol, and other fuels.

Step 3: Calculate Intensity Ratios

Select your preferred intensity metric and calculate:

Intensity Ratio = Total emissions (tCO2e) / Business metric

For example: 150 tCO2e / £5M turnover = 30 tCO2e per £M turnover

Step 4: Document Efficiency Actions

List and describe energy efficiency measures implemented during the year. Include:

• What was done
• When it was completed
• Expected or actual energy savings
• Investment required (optional but valuable)

Step 5: Draft Your SECR Statement

Prepare a clear, concise statement for your Directors' Report that includes all required elements. Most SECR statements are 1-3 pages in length.

Step 6: Get Sign-Off

Your SECR disclosure must be approved by your board of directors and signed off by a director as part of the Directors' Report approval process.

Want to see what a compliant SECR report looks like? View our sample SECR report to see exactly what Companies House expects.

SECR vs Other UK Reporting Requirements

It's easy to confuse SECR with other UK environmental reporting frameworks:

SECR vs ESOS

The Energy Savings Opportunity Scheme (ESOS) is a separate requirement for large undertakings consuming more than 40,000 kWh annually. ESOS requires a detailed energy audit every four years, while SECR is an annual reporting obligation.

Many businesses must comply with both frameworks. Learn more in our detailed guide: SECR vs ESOS: Understanding UK Carbon Reporting Frameworks.

SECR vs TCFD

Task Force on Climate-related Financial Disclosures (TCFD) reporting became mandatory for premium listed companies and large private companies from April 2022. TCFD focuses on climate-related financial risks, while SECR focuses on operational energy and emissions.

SECR vs Scope 3 Reporting

SECR primarily requires Scope 1 and 2 emissions. Scope 3 (supply chain and indirect emissions) reporting is optional under SECR but increasingly expected by stakeholders.

Common SECR Reporting Challenges

Challenge 1: Data Collection

Many businesses struggle to gather complete energy data, especially for:

• Multiple sites with different suppliers
• Company vehicles using personal fuel cards
• Shared office spaces where energy bills aren't itemized

Solution: Implement a monthly data collection process rather than scrambling at year-end. Consider energy monitoring systems for real-time tracking.

Challenge 2: Calculation Complexity

Applying the correct conversion factors and methodology requires technical expertise that most finance teams lack.

Solution: Use automated SECR compliance software or work with specialists who understand the GHG Protocol and UK Government methodology.

Challenge 3: Estimation and Data Gaps

Missing invoices or incomplete records require estimation, which must be documented and justified.

Solution: Document your estimation methodology clearly. Pro-rate known data, use industry benchmarks, or estimate based on operational hours.

Challenge 4: Year-on-Year Comparisons

Changes in business operations, acquisitions, or disposals make year-on-year comparisons complex.

Solution: Clearly explain any changes in methodology or reporting boundaries. Restate previous years if necessary for like-for-like comparison.

Automating SECR Compliance

Traditional SECR compliance involves hiring consultants at £15,000-25,000 per report with 6-10 week turnaround times. This is expensive and time-consuming for most SMBs.

Modern automated platforms like Comply Carbon streamline the process:

1. Upload energy bills (PDF or scanned documents)
2. AI extracts data automatically from invoices
3. Calculations performed using current UK Government factors
4. SECR report generated in Companies House-ready format
5. Review and download in under 10 minutes

This approach reduces costs by 90% (£1,999 vs £15k-25k) while ensuring 100% compliance with UK regulations.

Explore our complete SECR guide to learn more about the compliance process.

Future of SECR Reporting

SECR requirements continue to evolve:

Stricter Disclosure Expectations

Regulators and investors increasingly expect:

• Mandatory Scope 3 reporting (currently optional)
• Science-based emissions reduction targets
• Alignment with net-zero commitments
• More detailed energy efficiency action plans

Integration with Sustainability Reporting

SECR will likely integrate with broader ESG (Environmental, Social, Governance) reporting requirements, including:

• Sustainability Disclosure Requirements (SDR) for large companies
• International Sustainability Standards Board (ISSB) standards
• UK Green Taxonomy alignment

Digital Reporting Standards

Companies House is modernizing its systems, which may lead to:

• Structured digital SECR data submission
• Machine-readable formats (iXBRL or similar)
• Real-time compliance monitoring

Getting Started with SECR Compliance

If your business must comply with SECR for the first time, take these steps now:

1. Confirm your obligations: Check if you meet the size thresholds for two consecutive years
2. Identify your reporting boundaries: List all UK entities and operations to include
3. Set up data collection: Establish monthly energy data gathering processes
4. Understand your deadline: Calculate when your SECR report is due based on your year-end
5. Choose your approach: Decide whether to use consultants, in-house resources, or automated software

Not sure where to start? Try our free SECR compliance checker to determine your obligations and get a personalized compliance roadmap.

Conclusion

SECR reporting is a mandatory compliance requirement for thousands of UK businesses, but it doesn't have to be complicated or expensive. By understanding the requirements, gathering data systematically, and using the right tools, you can achieve full compliance while gaining valuable insights into your energy use and emissions.

The key is to start early, establish robust data collection processes, and ensure your report meets all Companies House requirements before your filing deadline.

Ready to simplify your SECR compliance? Get started with Comply Carbon today and generate your compliant SECR report in minutes, not months.

Additional Resources:

• UK Government SECR Guidance
• Companies House Filing Requirements
• GHG Protocol Corporate Standard
• DEFRA Conversion Factors 2025