Increasing the number of companies reporting!
This month we’re considering the future introduction of the Streamlined Energy and Carbon Reporting scheme (SECR). This scheme will be a requirement for large businesses; is your business ‘large’ and what reporting will be required?
Measuring through reporting
As we have seen in our previous blogs, the government has shown a lot of focus in producing and implementing legislation to help reduce energy waste and encourage efficiency. The aim is to meet their targets for reducing pollution, benefitting our environment and finances through the reduction of energy used.
To help monitor the success of this legislation the government has put in place reporting requirements for the largest companies affected. As the scope of energy legislation has increased, there has been a decision by the government to also increase the number of companies reporting too. Their ethos is that ‘what gets measured gets managed’!
The output of the most recent consultation on reporting was announced in the March 2016 budget: The Streamlined Energy and Carbon Reporting (SECR) scheme.
“What gets measured gets managed”
When will the new legislation come into force?
The new SECR scheme will come into force in April 2019 when it will replace the CRC Energy Efficiency Scheme (CRC EES). It will align with and extend the scope of the Mandatory Carbon Reporting (MCR) regulations for listed companies to include all large companies.
This will see the number of companies undertaking this annual reporting from 1,200 to 11,900 in line with those companies coming under the ESOS legislation.
“Is my company classed as ‘large’?”
Which companies will need to report?
As stated the scheme will mean that all ‘large’ companies will need to undertake this reporting. So the first question is what qualifies as a large company:
- All UK quoted companies will be included
- Any company with 250 or more employees qualifies
- Companies with an annual turnover greater than £36million
- An annual balance sheet of more than £18million
As ever there are exemptions for those companies using very small amounts of energy, i.e. less than 40,000kWh, and companies not registered in the United Kingdom.
“What will I need to report?”
What needs to be included in the reporting?
The main elements of the information that companies will need to report changes little; the big change is the increase in the number of companies that now must begin reporting or face consequences. All of the companies coming under the scheme will need to include a section on energy and carbon within their annual director’s report. This will include the following information:
- Data from the current and previous financial years
- An intensity metric; a measure of resources needed in production
- To include Scope 1 & 2 emissions, Scope 3 will be voluntary
- As a minimum details of electricity, gas and transport must be included
- Quote companies will need to report on global emissions
- Unquoted companies will only need to report on UK emissions
There should also be a summary on energy efficiency and actions taken in the financial year
There is no requirement to set out the ESOS recommendations or how they have been advanced. However, including the information could be something that you choose to do as a part of the company’s all-round energy planning.
Of course, the exemption for information that is simply not practical to find remains in place.
“This will be a part of the company’s all-round energy planning”
What does this mean for me?
The impact of the SECR will depend upon your current position:
|Already reporting under Mandatory Carbon Reporting||Only the inclusion of energy use and efficiency measures|
|Reporting & purchasing credits in the CRC EES||New SECR scheme will replace with most CRC costs moved to the Climate Change Levy|
|Those companies newly needing to report||Will need to report under the new scheme disclosing UK energy usage|
The SECR scheme requirements will be an additional action to many businesses. UK Energy Management view this as an opportunity for businesses not currently reporting to begin applying best practice and review their energy planning.
“This is an opportunity to review your energy usage and save your business money”
Most businesses are too busy with day to day tasks to think about their energy usage, and only really notice it once it starts to hit cash flow and the bottom line. Energy is a key part of any business’ planning; if you don’t have an in-house expert, you need to work with an expert energy management team such as UK Energy Management (UKEM).
We will look at the new reporting required; plus take a holistic approach to your complete energy infrastructure, monitoring how and when the business is consuming energy, increasing energy efficiency, reducing your carbon footprint, etc. to save your business money.
UK Energy Management deliver:
- Expert Impartial Advice
- Monitoring, Targeting, Analysis, and Procurement Services
- Established and Trusted Suppliers and Installers
“We provide the expertise you need”
We are your hub throughout the process, utilising our well-established relationships with energy experts who cover the whole energy spectrum. Your business can be energy efficient and cost effective with our help.
If you are unsure where you stand regarding this legislation, then contact us for an initial consultation on 020 3893 8108 or firstname.lastname@example.org