SECR: who has to report and how to prepare the disclosure

Who has to report

SECR covers three groups of organisations. Each must report unless an exemption applies.

• Quoted companies of any size. They have reported greenhouse gas emissions in the directors' report since the 2013 rules, and SECR added energy use.
• Large unquoted companies incorporated in the UK.
• Large limited liability partnerships (LLPs), which prepare an energy and carbon report.

Whether a company is large comes from the Companies Act size tests. For financial years beginning on or after 6 April 2025, an unquoted company is medium-sized, and outside SECR, if it meets at least two of these three tests.

If you exceed two of the three, you are large. Under the Companies Act two-year rule, a company's size normally changes only when it crosses the thresholds in two consecutive years, so one unusual year does not move you in or out.

In practice, a manufacturer with 10 to 249 staff already meets the employee test for a medium-sized company. It is caught only if its turnover is above £54 million and its balance sheet above £27 million, or if it sits inside a group that reports. A January 2026 evaluation for the Department for Energy Security and Net Zero (DESNZ) estimates that around 19,900 organisations must report under SECR. About 14,000 of them report in their own right rather than through a parent.

When a large company can report less

Being large does not always mean a full disclosure. The 2018 regulations that created SECR allow a few narrow exemptions.

• Low energy use: if the company used 40,000 kWh of energy or less in the year, it does not have to disclose the figures, but the report must say that it qualifies for this exemption.
• Information that is not practical to obtain can be left out, as long as the report says what is missing and why.
• In exceptional cases, information that the directors consider would seriously prejudice the company's interests can be left out.

Treat these as exceptions, not a route around the work. A gap you explain in the report is allowed. A gap you leave unexplained is likely to draw questions from your auditor.

What the disclosure must contain

For a large unquoted company, the energy and carbon information goes in the directors' report that is filed at Companies House. It must include:

• Your UK energy use in kWh, including gas, electricity and fuel for transport.
• The greenhouse gas emissions from that energy use, in tonnes of carbon dioxide equivalent (tCO₂e).
• The previous year's figures, from your second year of reporting onward.
• At least one intensity ratio, such as tCO₂e per £ million of turnover or per tonne of output.
• A description of the energy efficiency action taken during the year.
• The methodology used to calculate the figures.

For unquoted companies, the emissions are Scope 1 (fuel you burn, such as gas in boilers and diesel in company vans) and Scope 2 (electricity you buy). Transport also includes business travel in employees' own cars or hire cars where the company pays for the fuel, often through mileage claims. This is sometimes called the grey fleet.

Scope 3 emissions from your supply chain are voluntary under SECR for every type of organisation.

How to prepare it, step by step

1. 1Confirm scope earlyRun the size tests on your last two sets of accounts and note any group reporting. Do this before the year ends, not when the accounts are due.
2. 2List every energy sourceSites, meters, gas supplies, oil or LPG tanks, company vehicles, fuel cards and mileage claims. A list of meters by site stops anything being missed.
3. 3Collect a full year of recordsGather the bills, meter readings, fuel card statements and mileage claims for the financial year. Check for overlaps and gaps between bills, and mark any figure that is an estimate rather than a reading.
4. 4Apply the right conversion factorsConvert kWh and litres to tCO₂e with the DESNZ greenhouse gas conversion factors for the year your reporting period falls in. Do not mix factor years in one report.
5. 5Choose an intensity ratio you can repeatPick a measure that follows your activity, such as turnover or tonnes of output, and keep it from year to year so the comparison means something.
6. 6Record the efficiency actionWrite down what you changed during the year, such as lighting, heating controls or compressed air repairs, and what you plan to do next.
7. 7Write the methodologyState the standard you followed, the factor set, any estimates and any exclusions, in plain words that someone else could follow.

SECR is an annual requirement, so setting up the records at the start of the year saves a scramble when the accounts fall due. Most of the effort sits in step three: bills go missing, suppliers send estimates and meters get replaced mid-year.

Not every company in scope gets there. A business survey in the DESNZ evaluation suggests that between 14% and 23% of in-scope organisations may not comply. The same evaluation estimates that SECR cut energy use by 4.5% in 2020 and 6.2% in 2021 among the unquoted companies and LLPs it covers, so the records have a use beyond the report.

Who signs it off

The directors approve the directors' report, so the SECR disclosure is their responsibility. The auditor reads it with the rest of the report and states whether, in their opinion, it is consistent with the financial statements and has been prepared in line with the law. The auditor also reports any material misstatement they have found.

That is not an assurance of the carbon figures. It does mean that numbers which do not match the energy bills, or a methodology nobody can follow, will attract questions. Keep the evidence for every figure where the auditor can see it.

The same records answer other requests. A bid for a central government contract worth more than £5 million a year needs a Carbon Reduction Plan built from the same Scope 1 and 2 figures. Our guide to Carbon Reduction Plans covers what it needs.

How ESGen helps with SECR

The ESGen platform has an SECR lens. It calculates Scope 1 and 2 emissions from UK electricity, gas, diesel, petrol and staff-car mileage using the DESNZ factors. It keeps the bill behind each figure in an evidence library, checks the data for gaps and records every calculation in a log. Once you sign off a reporting period, it is locked.

Our team prepares the SECR disclosure with you from those figures, including the intensity ratio and the methodology statement, ready for your directors to approve. If the size tests put you outside SECR, we will tell you, and look at what your customers are asking for instead. Read more on the SECR page.

ESGen helps prepare structured reporting evidence. We are not your auditor, and no software makes a company compliant on its own. To see the SECR lens with example data, book a demo.