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Department for Business, Energy and Industrial Strategy

Supporting businesses with carbon disclosure reporting

4 April 2023

Learn how the ETL can help

Regulation around carbon disclosure for businesses is becoming more and more prevalent across the globe. When looking toward setting and achieving Net Zero goals, businesses must incorporate carbon accounting into their efforts. But what is it, how is it done and how can the Energy Technology List help? 

Setting the scene

Carbon accounting is an important element helping businesses to reach Net Zero goals, but it can also create other benefits for businesses, such as increased efficiency and increased compliance.  

In the UK, organisations are required to share information on their energy use and carbon emissions in their annual reports under the Streamlined Energy and Carbon Reporting policy (SECR). The main purpose of the policy is to make it quicker and easier to put energy efficiencies in place, where they have the potential to improve the environmental and economic efforts of a company.  

The SECR policy affects companies of any size listed on a public exchange (under the 2013 mandatory greenhouse gas reporting regulations), large unquoted companies and large limited liability partnerships. In this instance, a ‘large’ company is defined as per the Companies Act 2006. 

What’s involved in the SECR reporting framework? 

What’s required of businesses under the SECR reporting framework differs according to the type of organisation. Generally, SECR requires reporting Scope 1 and Scope 2 emissions, and whilst Scope 3 emissions for quoted companies are voluntary and highly encouraged, there is a legal minimum on Scope 3 emissions for large unquoted companies and LLPs. 

Other reporting requirements all types of businesses must follow include: 

  • At least one emissions intensity ratio.
  • The previous year's figures for energy use and GHG emissions. 
  • Energy efficiency actions, with narrative on the main measures taken to increase energy efficiency in the relevant financial year.
  • Methodology used. Companies are recommended to use a widely recognised independent stand.

All companies are also required to adhere to a “comply or explain” clause. While more information is generally better, this clause means that certain information can be left out provided the company can explain why it’s not possible to report upon it.

As well as explaining the steps taken to improve energy efficiency, energy savings made as a result of these steps should also be included where possible.

According to the government’s Environmental Reporting Guidelines, steps taken to increase a businesses’ energy efficiency might include actions such as; the use of smart meters and other monitoring tools, switching to electric vehicles, investment in efficient lighting, pumps and motors, carrying out behavioural change programmes and making sure service and maintenance strategies prioritise the efficiency of vehicles and machinery.

It’s important actions and results are reported on accurately as they form a key part of carbon reporting. Not only this, it enables companies to benchmark their progress as well as creating the context in which to explain where energy consumption varies.

You can read more about the SECR policy requirements here.

How can the Energy Technology List help? 

Reporting carbon disclosure is becoming a more clearly defined process, meaning businesses need to become more stringent in how they do this.

The Energy Technology List can play an important role in helping businesses meet their SECR carbon reporting obligations to help make this process simpler in many ways: 

  • The ETL provides easy access to over 8,000 independently validated energy efficient products. 

This helps businesses find and compare equipment that will help them to create energy savings, such as energy efficient boilers, electric motors, air conditioning and refrigeration equipment.  

  • The ETL enables energy efficiency measures. 

This is something that’s key for businesses looking to further expand into other mandatory reporting and voluntary frameworks such as TCFD, ESOS, CSRD ad SBTi, which require action plans and the implementation of energy efficiency measures.  

  • The ETL can be used as a ready-made procurement tool. 

Energy managers, purchasers, facilities managers, and those in procurement for a wide variety of professions can use the ETL to source, research and ask manufacturers questions about the equipment listed within it. The ETL API also means product information can be directly integrated into purchaser’s existing procurement system. 

  • The ETL boosts visibility. 

Manufacturers can use the ETL to gain a higher level of visibility for their products. Submitting an application is easy, and those that obtain verification will be accessed by a much wider audience, all looking to measure and reduce their climate impact, including those looking to comply with SECR on an annual basis.

  • The opportunity for savings is huge.  

Not only does equipment accredited by the Energy Technology List provide the opportunity to make energy cost savings, purchasers can also be assured that those listed will typically be within the top 25% of products on the market in their criteria.

If you’d like to find out more about the ETL and the energy efficient products available, take a look here.