Streamlined Energy and Carbon Reporting (SECR): A Complete Guide

Written by: Energy Guardians Limited.

Last Updated: August 17, 2025

Introduction

The global drive to cut greenhouse gas emissions and improve energy efficiency has pushed governments to strengthen corporate transparency. In the UK, the Streamlined Energy and Carbon Reporting (SECR) framework was introduced in April 2019 to increase accountability and encourage businesses to actively manage their energy and carbon impacts. It is more than just another compliance exercise. Done properly, SECR can provide strategic value, revealing efficiency opportunities, cost savings, and reputational advantages.

What is SECR?

SECR is a mandatory UK reporting framework that requires qualifying companies to disclose their energy use, greenhouse gas (GHG) emissions, and related efficiency measures within their annual reports.

It was introduced by the UK Government to replace and simplify previous schemes, most notably:

• The Carbon Reduction Commitment (CRC) Energy Efficiency Scheme, which was more administratively complex.

• Overlaps with Mandatory Greenhouse Gas Reporting (MGHG) for listed companies.

By streamlining requirements, SECR aimed to broaden coverage while reducing bureaucratic burden.

Why was SECR Introduced?

The rationale behind SECR is twofold:

1. Climate Accountability: The UK has legally binding net zero targets for 2050. Businesses contribute a large share of national emissions, so mandatory reporting ensures they are part of the transition.

2. Business Efficiency: Energy efficiency and carbon reduction often align with cost savings. By requiring disclosure, SECR nudges businesses to identify inefficiencies and reduce energy bills.

   
   

It also enhances transparency for investors, customers, and stakeholders, who increasingly demand credible climate data when making decisions.

Who Must Comply with SECR?

SECR applies to UK-registered companies meeting certain criteria. Broadly, three categories of entities must comply:

1. Quoted Companies

   
   

   • Already subject to Mandatory Greenhouse Gas Reporting.

   • Must disclose global GHG emissions, energy use, and intensity ratios.

   
   

2. Large Unquoted Companies

   
   

   • Defined by meeting two or more of the following:

     
     

     • Turnover of £36 million or more

     • Balance sheet total of £18 million or more

     • 250 or more employees

       
       

   • Must report UK energy use and associated GHG emissions.

   
   

3. Large Limited Liability Partnerships (LLPs)

   
   

   • Same size criteria as above.

   • Must include SECR disclosures in their energy and carbon report (filed with Companies House).

   
   

Exemptions exist where:

• Companies consume 40,000 kWh or less of energy in the reporting period (de minimis exemption).

• Disclosure is deemed seriously prejudicial to the business.

What Must Be Reported?

For entities in scope, disclosures typically include:

• Total energy use from electricity, gas, transport fuel, etc.

• Associated GHG emissions in CO₂e (carbon dioxide equivalent).

• At least one intensity ratio (e.g., tonnes CO₂e per £m turnover, or per unit of production).

• Energy efficiency actions taken during the financial year.

• Methodologies used for calculations.

Quoted companies must report global energy and emissions, while unquoted companies and LLPs focus on UK energy and emissions.

Repercussions of Non-Compliance

Failure to comply with SECR has both legal and reputational consequences:

• Legal and Regulatory Risks

  
  

  • SECR disclosures form part of the company’s annual report filed at Companies House. Failure to include them can lead to the entire report being rejected.

  • The Conduct Committee of the Financial Reporting Council (FRC) has authority to review and enforce compliance.

  • Penalties include fines, director accountability, and possible legal action for persistent breaches.

  
  

• Reputational Risks

  
  

  • Increasing scrutiny from investors, lenders, customers, and employees means that incomplete or absent SECR reporting can damage trust.

  • In sectors where sustainability credentials are essential (e.g., construction, finance, consumer goods), non-compliance may limit contract opportunities.

Benefits of SECR Compliance

While many see SECR as a reporting burden, it can provide significant value if approached strategically:

• Financial Savings

  
  

  • Highlighting inefficient energy use often leads to targeted efficiency projects and cost reductions.

  • Lower energy bills strengthen competitiveness.

  
  

• Risk Management

  
  

  • Identifies exposure to volatile energy prices and carbon costs.

  • Provides data for scenario planning and alignment with net zero policies.

  
  

• Improved Investor Confidence

  
  

  • Transparency on energy and emissions strengthens Environmental, Social, and Governance (ESG) credentials.

  • Many investors now require robust climate disclosures aligned with frameworks like TCFD (Task Force on Climate-related Financial Disclosures).

    
    

• Reputation and Market Advantage

  
  

  • Demonstrating compliance and going beyond it signals a proactive stance on climate issues.

  • Helps win tenders and contracts where sustainability is a selection criterion.

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• Alignment with Future Regulations

  
  

  • SECR provides a foundation for broader sustainability and climate reporting, such as TCFD, CSRD (EU), or ISSB standards.

  • Early compliance positions businesses ahead of tightening regulations.

Challenges in SECR Reporting

Despite its benefits, companies often face challenges, including:

• Gathering reliable and complete energy data across multiple sites and fleets.

• Establishing consistent methodologies for emissions calculations.

• Defining meaningful intensity ratios that reflect operational performance.

• Embedding SECR into long-term sustainability strategy, rather than treating it as a tick-box exercise.

Conclusion

SECR is more than a compliance obligation. It is a tool for operational efficiency, risk management, and stakeholder trust. Businesses that take SECR seriously stand to benefit not only through legal compliance but also through stronger financial performance and reputational advantage.

With growing expectations on corporate transparency and climate action, SECR is best seen as a stepping stone toward comprehensive sustainability leadership. Companies that embed robust carbon reporting practices today will be far better positioned for tomorrow’s regulatory and market landscape.

Energy guardians can support organisations in meeting SECR requirements by monitoring energy use, ensuring accurate data collection, and identifying opportunities for efficiency improvements that strengthen reporting. They also help embed a culture of accountability, engaging staff and driving behavioural changes that reduce consumption. If your organisation would benefit from expert guidance in setting up or enhancing an energy guardian programme to ensure compliance and maximise savings, please contact us for support.