For financial years beginning on or after 1 April 2019, large UK companies are required to prepare and file energy and carbon information in their Directors’ Report. This impacts approximately 12,000 organisations.
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
When reporting at group level, the energy and carbon disclosures must also take into account the information of any subsidiaries included in the consolidation. However, there is an option to exclude any energy and carbon information relating to a subsidiary which the subsidiary would not itself be obliged to include if reporting on its own account – for example if the subsidiary itself is not a large UK company. Also, a UK subsidiary which is required to report under the SECR framework may not need to include the energy and carbon information in its own subsidiary accounts and reports, if these obligations are already met through a parent’s group level report – although of course a subsidiary may choose to still make the disclosures voluntarily to promote their energy efficiency.
There is an additional exemption for businesses which use low levels of energy - less than 40MWh of energy in a period. This fact must still be disclosed in the Directors Report however.
Unless exemptions apply, unquoted, large companies, must disclose the following within their Directors’ Report:
- UK energy use
- Associated Greenhouse Gas emissions
- At least one intensity ratio
- Comparative figures (except in first year reporting)
- Information about energy efficiency action taken by the organisation during the year
- Methods to calculate disclosures
Full guidance can be found within the Environmental Reporting Guidelines on the gov.uk website at : Environmental Reporting Guidelines (publishing.service.gov.uk)
Please contact your usual Lovewell Blake contact, or one of the Corporate Services team, to discuss the requirements for your business.