New Energy Legislation: Are You Compliant?

Streamlined Energy and Carbon Reporting

In 2018, the UK Government announced plans for the new Streamlined Energy and Carbon Reporting (SECR) regulations that would come into force on 1 April 2019.

The idea behind the framework is to simplify and streamline carbon and energy reporting efforts by companies, whilst ensuring that they have all the necessary information to reduce emissions and energy costs.

What does it involve?

This new legislation will involve annual reporting for all large quoted and unquoted companies (as defined by the Companies Act 2006) and large limited liability partnerships to reveal their carbon emissions and energy consumption in relation to electricity, transport and gas. They will be required to record energy efficiency actions and report at least one carbon emission intensity ratio. These intensities are used to determine estimates of greenhouse gas or air pollutant emissions and to compare the environmental impact of different fuels.

The new mandatory scheme has replaced the CRC Energy Efficiency Scheme and extends the Mandatory Greenhouse Gas Emissions (MGHG). Around 1,200 companies report under MGHG; with SECR, this number is expected to increase to around 11,900.

Why?

These changes help form the basis of new policies the government are implementing as part of their Clean Growth Strategy: to deliver on its ambition of enabling business and industry to improve their energy productivity by at least 20% by 2030. The Department of Business, Energy and Industrial Strategy (BEIS) acknowledged that the array of energy efficiency policies adopted by organisations can often create administrative burdens and complex ways of working. SECR is part of the new reporting regime that the UK government announced in 2016 to simplify the reporting process.

With sustainable and eco-friendly working methods increasingly appearing in all industries and practices, this new reporting framework is aimed at encouraging organisations to measure their energy efficiency, to cut costs, improve productivity, as well as reduce carbon emissions with potentially huge environmental and economic benefits.

How will this impact my organisation?

All large quoted and unquoted companies will have to report annually. Organisations would be classed as large if they fall into two of the below criteria:

  • More than 250 employees

  • An annual turnover greater than £36m

  • An annual balance sheet greater than £18m

There is little change if you are already reporting under the Mandatory Carbon Reporting (MCR), except for the addition of including energy use and efficiency measures.

SECR will replace the CRC EES reporting and purchasing credits.

As stated, at present there are around 1,200 companies currently reporting their MCR. With this new legislation, there are a further 10,000 organisations that will be affected who don’t currently fall into either scheme but will be required to submit their energy data.

What preparations should organisations put in place?

The process of capturing and evaluating energy usage data will depend on what procedures the organisation currently follows; however, it’s recommended to undertake a review of what you’re currently reporting to assess the current levels and what additional reporting is needed.

How do we report?

The government has set out guidance on what it deems best practice, however it hasn’t detailed which specific methodologies should be used. Reporting electronically for SECR is currently voluntary, however the government is keeping this under review, following 78% of respondents in the Government’s response to SECR agreeing that energy and carbon reporting to Companies House should be electronic.

How can Alcumus Info Exchange help?

Managing your environmental impact can help to improve your organisation's sustainability performance. Environmental management helps to set objectives and targets to improve performance and manage environmental risks within an organisation. Our award-winning software is designed to streamline and simplify your reporting requirements through centralised data collection, management and analysis. We can help you capture data and utilise the extensive reporting functionality. It allows you to measure against KPIs in a corporate structure, and work in line with current legislation.

For all our clients who are now required to report on the Streamlined Energy and Carbon Reporting legislation, our Environmental Information Management module will allow organisations to manage their energy data including greenhouse gas, waste and pollutants, while building reports based on a wide range of data and analytics with advanced calculations to analyse emissions.

Find out how ENGIE UK, an Info Exchange client, are utilising our software to report their carbon footprint and comply with this new legislation.


Learn more about how Info Exchange can help you by emailing infoexchange@alcumusgroup.com.