SECR reporting, from meter to directors’ report

The first question each year is whether the section is owed at all, and the answer comes from the accounts, not from the energy data.

A quoted company needs no test: Part 7 applies at any size, so the only question is which Part.

For an unquoted company, take this year’s and last year’s turnover, balance sheet total and average headcount, because paragraph 20B looks at two years once the first year has passed.

The balance sheet figure is gross assets, before liabilities, and headcount is the average of monthly totals of people employed under contracts of service, not full-time equivalents.

For a short or long financial year, pro-rate the turnover only; the other two limbs are taken as they stand.

A parent runs the same test on its group’s aggregate figures, and may choose the net or the gross limits.

Record the answer, the figures and the limb relied on, because next year’s test needs this year’s result.

The checker beside this text runs the test with last year’s status built in, and states which limb of ¶20B(1) produced its answer.

The energy figure in kWh is SECR’s genuine addition to the older greenhouse gas duty, and it is the figure the 40,000 kWh relief is tested against.

For an unquoted company the minimum is electricity, gas and transport fuel; the guidelines describe UK energy use “to include as a minimum purchased electricity, gas and transport”.

Grey-fleet mileage is the item most often missing from a first-year disclosure, because it lives in expense claims rather than in any energy system.

Convert miles to fuel using the vehicle-size and fuel-type factors in the government set, not a single average, and keep the claim records as the audit trail.

Companies with their own freight operations can use the government-backed guidance on measuring freight transport emissions for the fleet element.

Where a meter reading is missing, an estimate is acceptable if it is disclosed; the methodology statement should say what was estimated and how.

Many reporters hold this dataset in carbon reporting software; what a tool must produce is set out on the SECR reporting software page, and a spreadsheet does the job for a small estate.

Purchased electricity can be accounted for in two ways, and the difference decides whether a renewable tariff shows up in the headline number.

The location-based method applies the average intensity of the grid; the market-based method applies the emission rate of what the company contracted for, such as a renewable tariff backed by Renewable Energy Guarantees of Origin, which Ofgem administers.

The GHG Protocol Scope 2 Guidance asks for both.

The government’s guidelines page records, in its 29 March 2019 update, that dual reporting is “still our preferred approach” and that organisations choosing not to dual report are encouraged to use the location-based method.

A disclosure that gives only a market-based figure — often a striking zero — has not given the number the guidance points to.

UK SRS S2 goes further, requiring a location-based Scope 2 figure and permitting market-based information alongside it; the Scope 2 emissions page covers both methods.

The conversion itself is simple multiplication; the decisions are which factor, which year and which denominator.

Take a company that used 1,200,000 kWh of grid electricity in a financial year falling mostly in 2026.

At the 2026 location-based factor of 0.13096 kgCO2e per kWh, that is 157,152 kg, or about 157.2 tonnes CO2e.

The same kWh at the 2025 factor of 0.17700 would have been 212.4 tonnes, so a company that used exactly the same electricity will show a fall of about a quarter from the factor alone.

Grid transmission and distribution losses on that electricity add about 15.6 tonnes at the 2026 loss factor, which DESNZ classes as Scope 3 and which sit outside the Scope 2 figure.

Gas and transport fuel are converted the same way, each with its own factor from the same year’s workbook, and the results are added to give the emissions figures the report states.

If the company’s turnover was £48 million, the electricity alone gives a ratio of about 3.3 tonnes per £ million; the ratio the report states is built on the total, not on one fuel.

The calculator beside this text holds the two electricity factor sets and takes fuel factors typed from the DESNZ workbook, so the working can be checked line by line.

Keep the workings: the methodology statement needs the factor year, and next year’s comparative needs this year’s figures on a basis that can be repeated.

The efficiency narrative is the one part of the section a reader can compare with what the company actually did, so it pays to quantify it honestly.

The simplest defensible method is a before-and-after comparison of metered consumption at the supply point, adjusted as far as practicable for weather or output.

Where equipment was replaced like for like, the difference in rated power times the hours of use gives an estimate: swapping a 150 W fitting for a 60 W one that runs 4,000 hours a year saves about 360 kWh a year per fitting.

A feasibility study or supplier quotation can supply the estimate, provided it is checked against metered data once the measure is running.

Whichever method is used, say which, and do not present a reduction caused by selling a site or making less product as an efficiency saving.

Large ESOS participants have a head start: since Phase 4, an ESOS report must estimate the savings achieved from each measure in kWh and put each in one of six categories, which is most of what a strong SECR narrative needs.

A programme of many small measures can be reported as one, with the programme’s total saving, rather than a long list of items nobody can check.

The FRC’s 2021 review wanted disclosures that are understandable and relevant, not just compliant, and a narrative tied to figures is the part of the section that meets that bar.

The section is approved as part of the directors’ report under section 415 of the Companies Act 2006, and a director who approves a non-compliant report knowingly or recklessly commits an offence under section 419.

Section 414C(11) lets the directors carry directors’-report matters they consider of strategic importance into the strategic report instead, which is how some companies present energy and carbon alongside their climate disclosures.

Those climate disclosures are a separate regime: large companies’ climate-related financial disclosures under SI 2022/31, and, for companies it applies to, the FRC’s UK Corporate Governance Code 2024 on board oversight.

The auditor reads the directors’ report for consistency with the accounts; a kWh figure that contradicts the utilities cost line is the kind of mismatch that gets noticed, but this is not assurance — see sustainability assurance.

The FRC’s corporate reporting review can query a filed report, and the FRC’s annual review of corporate reporting sets out what it looked at in the year.

The filing period does not move for a weekend or bank holiday, and late accounts attract the Companies House late filing penalty on the company; the sister reference at sustainabilityreportingstandards.co.uk keeps a SECR deadline calendar.

Companies House receives the accounts; there is no SECR portal, register or acknowledgement.

Because the section is filed with the accounts, its real deadline is earlier than the filing date: it has to be settled before the board approves the directors’ report and before the auditor reads it.

A private company with a 31 December 2026 year end files by 30 September 2027, and a public company by 30 June 2027; an LLP has the private company’s nine months.

Work back from the board meeting that approves the annual report: the energy figures need the last quarter’s invoices and mileage claims, which arrive weeks after the year end.

Estimates for a missing final month are acceptable if they are disclosed as estimates, and are often the difference between a report on time and one delayed.

The calculator beside this text gives the statutory date for any year end, applies the month-end rule and the first-accounts rule, and shows the late-filing penalty band for a given delivery date.

A late filing costs the company a civil penalty; a report filed on time but wrong is the directors’ problem under section 419, which is why the timetable should not squeeze the review.

The builder beside this text lists the rows Schedule 7 requires for each reporter type and the statement any relief leaves behind; use it as the last check before the draft goes to the board.

Every required row is present, including the kWh figure, which is the one most often folded into a table heading and lost.

Every missing figure is covered by a stated reason: practicality, low energy use or serious prejudice.

The factor year is named for this year and last, and any change in method or boundary since last year is explained.

For an unquoted company, reimbursed business mileage is in the transport figure.

For a quoted company, the UK and offshore proportions are stated for emissions and for energy.

The intensity ratio uses the same denominator as last year, or last year’s ratio is restated on the new one.

Electricity is shown on a location basis, with any market-based figure beside it and its instruments named.

The SECR report template has model wording for each row once the checks pass.

The written statement of 21 October 2025 announced the aim of removing the directors’ report, while keeping “reporting on energy and emissions” and moving it elsewhere in the annual report.

The Modernising corporate reporting consultation of 7 September 2026 carries that through: no prescribed location, anywhere in the first half of the annual report, and no statutory instrument yet.

Commentary such as this summary on Mondaq covers the wider package; the consultation document is the text to rely on.

UK SRS S1 and S2 were published by DBT on 25 February 2026 for voluntary use, and the FCA’s final rules now require listed companies in five categories to report against them on a comply-or-explain basis for accounting periods beginning on or after 1 January 2027.

Those rules finalise CP26/5, which had proposed making S2 mandatory; the final rules do not, and they leave SECR where it was.

SECR data is the natural starting point for the UK SRS S2 emissions metrics; UK SRS S1 and S2, UK SRS compliance, UK SRS Scope 3 reporting and the dated register of UK SRS events cover that side.

Wider Scope 3 reporting was the subject of a DESNZ call for evidence published on 19 October 2023, whose summary of responses followed in November 2024; SECR’s own Scope 3 duty remains the transport-fuel limb.

Adjacent regimes run separately: climate change agreements, the ESOS phases set by regulation 4 of the ESOS Regulations, and EU reporting for groups with EU operations, compared in CSRD and UK SRS.

Public bodies outside SECR’s populations report under their own arrangements — local authorities, for example, under the local authority emissions guidance.

The document every SECR explainer links to is the Environmental Reporting Guidelines, published jointly by the energy, environment and former business departments and last updated on 29 March 2019.

Its account of how to draw a boundary and treat leased assets is still the best official statement of method, which is why it remains worth reading.

Almost everything that has happened since is missing from it: the timeline beside this text lists the milestones a 2026 reporter needs and the guidelines do not mention.

It also carries two traps: it describes the low-energy relief as “40 MWh” rather than the schedule’s 40,000 kWh, and it explains the LLP threshold by reference to the Companies Act sections that moved in 2025.

It still describes the CRC Energy Efficiency Scheme as though it were live, although CRC ended after the 2018–19 compliance year.

DESNZ’s own review names clearer guidance on eligibility, sites and group boundaries as the first theme for its planned consultation.

The practical rule is to take method from the guidelines and every threshold, date and adjacent regime from the instrument.

Help with SECR is a market, and DESNZ measured it: its evaluation found that 56% of compliers incur external costs, from consultancies and auditors to monitoring technology.

Nothing in the law requires outside help, and a company with a small estate and good invoices can produce a compliant section in-house.

Where help is bought, the useful questions are about the output, not the badge: will the work produce every Schedule 7 row for the company’s Part, the factor year, a written boundary, and workings the auditor and next year’s team can follow?

Software is the other route, and the SECR reporting software page sets out what a tool must hand back.

A provider describing a “SECR certificate” or “SECR accreditation” is describing something the regime does not have.

This site is an independent reference, not a provider; guides to choosing carbon consultants set out what to ask, and you can book a free 15-minute call to talk a question through.

Integrating SECR with broader goals mostly means re-using its data: the same dataset feeds a UK SRS S2 starting point, an ESOS assessment and a carbon reduction plan, and DESNZ’s review records that businesses found re-using SECR data across schemes easy in 40–71% of cases.