SECR compliance — UK carbon reporting guide

SECR compliance and SECR reporting represent the UK's foundational framework for corporate climate disclosure, building on earlier Carbon Reduction Commitment (CRC) Energy Efficiency Scheme requirements while significantly expanding mandatory carbon reporting requirements UK. 1

SECR guidance creates a streamlined approach combining energy and carbon reporting with greenhouse gas emissions disclosure, providing essential foundation for future enhanced climate reporting under UK SRS S2 standards. Companies implementing effective SECR compliance processes establish critical data collection and governance capabilities required for emerging sustainability reporting frameworks.

Companies subject to SECR requirements must integrate climate information directly into statutory annual reports through the directors' report, establishing these carbon reporting requirements UK as core elements of corporate reporting alongside traditional financial metrics under Companies House filing requirements.

Scope 1 — direct emissionsGHG Protocol

Direct emissions from owned or controlled sources — fuel combustion in company vehicles, manufacturing processes, building heating. Reported in tonnes CO2e using UK government conversion factors, updated annually 3.

Scope 2 — indirect energyLocation-based primary

Indirect emissions from purchased electricity, steam, heating and cooling. Location-based methodology is the primary approach; market-based methodology permitted as supplementary disclosure where renewable contracts apply.

Energy consumptionkWh

Total energy in kWh covering electricity, gas, transport fuels and other sources, following the GHG Protocol Corporate Standard for consistent boundary definitions.

Intensity ratioComparability

At least one emissions intensity metric (e.g. tCO2e per £ turnover, per FTE, or per unit of production) chosen for relevance to the business and comparability year-on-year.

Methodology statementNarrative

Description of calculation methodology, boundary definitions and any estimation approaches — following GHG Protocol Corporate Standard.

Scope 1 emissions include direct emissions from owned or controlled sources such as fuel combustion in company vehicles, manufacturing processes, and building heating systems. Companies must report Scope 1 emissions in tonnes of CO2 equivalent using UK government conversion factors updated annually. 3

Scope 2 emissions cover indirect emissions from purchased electricity, steam, heating, and cooling consumed by company operations. SECR regulations require location-based methodology as the primary approach, with market-based methodology permitted as supplementary disclosure where companies have renewable energy contracts through Ofgem certified schemes or certificates.

Energy data provides the foundation for emissions calculations and enables assessment of energy efficiency reporting improvements over time. 4 Companies implementing SECR compliance should establish robust data collection systems covering all significant energy consumption sources across UK operations, following GHG Protocol Corporate Standard methodology. Many organizations rely on dedicated carbon reporting tools and SECR reporting software to automate data collection, ensure calculation accuracy, and produce audit-ready documentation for SECR compliance.

Effective energy efficiency reporting includes detailed descriptions of specific measures such as building retrofits, equipment upgrades, process optimisation, and behavioural change programmes. Companies should quantify energy savings where feasible, explaining calculation methodologies following IEA Energy Efficiency Guidelines and assumptions used in savings estimates.

Leading SECR compliance disclosures combine quantitative savings data with strategic narrative explaining energy efficiency priorities, governance processes, and alignment with net zero commitments. 5 Professional guidance from ICAEW emphasises connecting efficiency measures with business strategy and financial performance metrics.

Companies must ensure SECR compliance content is clearly identifiable within the directors' report, following FRC Corporate Governance Code requirements. 6 Integration with emerging UK SRS requirements requires careful coordination across multiple SECR regulations frameworks.

Companies can use current SECR reporting to prepare for enhanced climate reporting by expanding data collection beyond minimum requirements. 10 Strategic preparation should focus on areas likely to become mandatory under UK SRS implementation, including Scope 3 emissions measurement, scenario analysis capabilities, and governance framework development. Organizations requiring comprehensive carbon footprint assessment across complex operations often partner with carbon footprint consultants to establish robust methodologies for enhanced reporting requirements.