UK Carbon Emission Reporting Requirements Explained

Executive Summary

Carbon emission reporting has become a central part of how UK organisations demonstrate accountability for their environmental impact. As climate targets, investor expectations and regulatory requirements continue to develop, understanding what carbon emission reporting involves, who it applies to and what frameworks exist is increasingly important for organisations of all sizes.

This guide explains the fundamentals of carbon emission reporting in the UK, including the main reporting obligations, qualification criteria and the most widely used carbon reporting frameworks. It is designed as a practical, informational reference for anyone looking to understand how carbon reporting requirements in the UK work in practice.

Watch our short guide to UK carbon emission reporting requirements, including who needs to report, what must be disclosed and the main frameworks organisations should be aware of.

What Is Carbon Emission Reporting?

Carbon emission reporting is the process of measuring, calculating and publicly disclosing an organisation’s greenhouse gas (GHG) emissions. It provides a structured, transparent account of the environmental impact of an organisation’s operations, typically expressed in tonnes of carbon dioxide equivalent (tCO₂e).

At its core, carbon emission reporting involves three things:

Measuring Greenhouse Gas Emissions

Organisations measure their greenhouse gas emissions by collecting activity data, such as energy consumption from gas and electricity, fuel used in transport, and other operational inputs, and converting that data into emissions figures using recognised emission factors. In the UK, the most widely used emission factors are published annually by the Department for Energy Security and Net Zero (DESNZ), commonly referred to as the government conversion factors for company reporting of greenhouse gas emissions.

Categorising Emissions by Scope

The Greenhouse Gas Protocol established the widely adopted framework for categorising emissions into three scopes:

• Scope 1 – Direct emissions: Emissions from sources the organisation owns or controls directly. This includes on-site fuel combustion (such as gas boilers and diesel generators), company-owned vehicles, refrigerant leakage and manufacturing processes.
• Scope 2 – Indirect energy emissions: Emissions from the generation of purchased electricity, heat, steam or cooling that the organisation consumes.
• Scope 3 – Other indirect emissions: All other emissions that occur across the organisation’s value chain, both upstream and downstream. This includes purchased goods and services, business travel, employee commuting, waste disposal, logistics and the use of sold products. Scope 3 is typically the largest share of an organisation’s carbon footprint and the most complex to measure accurately.

Reporting Obligations and Disclosures

Carbon emission reporting is not simply an internal exercise. For many UK organisations, it is a legal obligation. Qualifying organisations must include their energy use and emissions data in publicly available statutory reports, such as the Directors’ Report within annual financial accounts. This ensures transparency and allows investors, regulators and other stakeholders to assess an organisation’s environmental performance and progress over time.

Beyond legal compliance, carbon emission reporting increasingly plays a role in wider sustainability governance. Organisations use emissions data to set reduction targets, inform strategic decisions, respond to supply chain data requests and demonstrate credibility on climate commitments.

Is Carbon Reporting Mandatory in the UK?

Yes. Mandatory carbon reporting has been a feature of UK corporate governance for over a decade, and the scope of these requirements has expanded significantly in recent years.

A Brief History of Mandatory Carbon Reporting in the UK

The UK’s mandatory carbon reporting journey began with the Companies Act 2006 (Strategic Report and Directors’ Reports) Regulations 2013, which first required UK-quoted companies to disclose their greenhouse gas emissions in their Directors’ Reports. This was known as Mandatory GHG Reporting.

In April 2019, the UK government introduced the Streamlined Energy and Carbon Reporting (SECR) framework through the Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018. SECR significantly widened the scope of mandatory carbon reporting, extending obligations beyond quoted companies to include large unquoted companies and large Limited Liability Partnerships (LLPs).

Who Must Report Under SECR?

SECR applies to three categories of organisation:

• Quoted companies – All UK-incorporated companies whose equity shares are listed on the Main Market of the London Stock Exchange, a European Economic Area state exchange, the New York Stock Exchange or NASDAQ. Quoted companies are in scope regardless of size.
• Large unquoted companies – UK-incorporated companies that meet at least two of the three size thresholds (see below).
• Large Limited Liability Partnerships (LLPs) – LLPs that meet at least two of the three size thresholds.

Approximately 11,900 organisations across the UK are currently required to comply with SECR.

What About Voluntary Reporting?

While SECR defines the mandatory reporting threshold, the UK government encourages all organisations to report on their energy use and carbon emissions voluntarily, even if they fall below the qualification criteria. Voluntary reporting can help organisations demonstrate leadership, meet supply chain expectations and prepare for future regulatory changes.

The Environmental Reporting Guidelines published by GOV.UK provide practical guidance for both mandatory and voluntary reporting.

Which UK Companies Need to Report Carbon Emissions?

The carbon reporting requirements in the UK are determined by the type and size of the organisation. The qualification criteria are straightforward.

The Large Company Threshold

Under the SECR regulations, the qualification thresholds for large unquoted companies and LLPs are based on the original size criteria embedded in the 2018 regulations. A company or LLP must meet at least two of the following three criteria:

Note: The general Companies Act 2006 size thresholds for large companies were raised to £54 million turnover and £27 million balance sheet for accounting periods beginning on or after 6 April 2025. However, the SECR-specific qualification thresholds were not amended and remain at the levels above. This means some companies that now qualify as ‘medium’ under the Companies Act may still be required to report under SECR.

Any large company or large LLP that meets at least two of these thresholds is required to report under SECR.

Quoted companies are in scope regardless of whether they meet these size thresholds. All UK-incorporated quoted companies must report, irrespective of turnover, balance sheet total or employee numbers.

Exemptions

There are limited exemptions from SECR reporting:

• Low energy users – Organisations that consume 40,000 kWh or less of energy during the reporting period may claim a low energy user exemption. For large unquoted companies and LLPs, this threshold applies to UK energy consumption only. If this exemption is used, it must be explicitly stated in the Directors’ Report.
• Subsidiary exemptions – A subsidiary undertaking is exempt from individual reporting if it is included in a qualifying UK group report prepared by its parent entity for a financial year ending at the same time as, or before, the subsidiary’s financial year.
• Seriously prejudicial – In exceptional circumstances, directors may exclude carbon and energy information if disclosure would be seriously prejudicial to the interests of the organisation. This must also be stated in the report.

Summary: Who Reports What

What Are the Main UK Carbon Reporting Requirements?

Once an organisation is in scope, the carbon reporting requirements under SECR cover five core areas.

Energy Consumption Reporting

Organisations must report their total energy consumption in kilowatt hours (kWh). As a minimum, this must include:

• Electricity – purchased electricity consumed in operations
• Gas – natural gas used for heating, processes or other purposes
• Transport fuel – fuel consumed by company-owned or controlled vehicles, including fleet vehicles and company cars used for business purposes.

For quoted companies, energy consumption must be reported on a global basis. For large unquoted companies and LLPs, reporting covers UK energy use only (including the UK offshore area).

Greenhouse Gas Emissions Disclosures

Organisations must disclose their annual greenhouse gas emissions in tonnes of carbon dioxide equivalent (tCO₂e), calculated from their reported energy consumption:

• Scope 1 emissions – direct emissions from fuel combustion, company vehicles, refrigerants and on-site processes
• Scope 2 emissions – indirect emissions from purchased electricity, heat, steam or cooling.

Quoted companies must report all greenhouse gas emissions from activities they are responsible for, globally. This includes the seven greenhouse gases covered under the Kyoto Protocol and its Doha Amendment: carbon dioxide (CO₂), methane (CH₄), nitrous oxide (N₂O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), sulphur hexafluoride (SF₆) and nitrogen trifluoride (NF₃).

Large unquoted companies and LLPs report only the greenhouse gas emissions associated with their UK energy use.

Scope 3 emissions are not mandatory under SECR but are strongly encouraged, particularly for quoted companies. The UK government has also launched a call for evidence on Scope 3 greenhouse gas emissions reporting, signalling that Scope 3 requirements may expand in future.

Methodology Requirements

Organisations must disclose the methodology used to calculate their energy consumption and greenhouse gas emissions. The most widely used methodologies in the UK are:

• GHG Protocol Corporate Accounting and Reporting Standard – the globally recognised methodology for corporate emissions accounting
• DEFRA conversion factors – the UK government’s annually updated emission factors, used to convert activity data (such as kWh of electricity or litres of fuel) into tCO₂e figures.

Organisations must also define their organisational boundary, choosing either an equity share approach or a control approach (financial control or operational control) to determine which operations are included in their report.

Intensity Ratios

All organisations in scope must report at least one intensity ratio. An intensity ratio expresses the organisation’s annual emissions relative to an appropriate business metric, allowing year-on-year comparison and benchmarking.

Common intensity ratios include:

• Tonnes of CO₂e per million pounds of revenue
• Tonnes of CO₂e per employee (full-time equivalent)
• Tonnes of CO₂e per square metre of floor space
• Tonnes of CO₂e per unit of production.

The choice of intensity ratio should be relevant to the organisation’s operations and consistent from year to year to enable meaningful comparison.

Energy Efficiency Actions

Organisations must include a narrative description of the principal measures taken to improve energy efficiency during the reporting period. This is a qualitative disclosure, intended to demonstrate that the organisation is actively working to reduce its energy consumption and emissions, not just measuring them.

Examples of energy efficiency actions commonly reported include LED lighting upgrades, building management system improvements, HVAC optimisation, fleet electrification, renewable energy procurement and behavioural change programmes.

Prior Year Comparisons

All SECR reports must include the previous year’s figures for energy use and greenhouse gas emissions, enabling year-on-year performance comparison. This is a mandatory requirement for both quoted and unquoted organisations.

Common Carbon Reporting Frameworks

SECR remains the primary legislative mechanism for mandatory carbon reporting in the UK and sits within the Directors’ Report of annual financial accounts.

GHG Protocol Corporate Standard

The Greenhouse Gas Protocol is the most widely used international framework for measuring and reporting corporate greenhouse gas emissions. Developed by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD), it provides detailed guidance on defining organisational boundaries, categorising emissions into Scope 1, 2 and 3, and applying consistent calculation methodologies.

The GHG Protocol underpins most major climate disclosure frameworks globally, including SECR, CDP, the Science Based Targets initiative (SBTi) and the UK Sustainability Reporting Standards. It is effectively the default methodology for corporate carbon accounting in the UK and internationally.

ISO 14064

ISO 14064–1:2018 Greenhouse Gases is an international standard published by the International Organisation for Standardisation (ISO) for the quantification, monitoring, reporting and verification of greenhouse gas emissions. It is structured in three parts:

• ISO 14064-1 – Organisation-level GHG emissions and removals
• ISO 14064-2 – GHG reductions at the project level
• ISO 14064-3 – Validation and verification of GHG assertions.

While the GHG Protocol is primarily a reporting and accounting framework, ISO 14064 is designed with third-party verification in mind, making it particularly relevant for organisations seeking independently assured emissions reports. The two frameworks are complementary rather than competing, and many organisations use the GHG Protocol for calculation methodology alongside ISO 14064 for verification.

For further information on ISO 14064 we recommend our guide ISO Standards Supporting Energy Monitoring and Targeting for Energy Efficiency and Net Zero.

UK Sustainability Reporting Standards (UK SRS)

The UK Sustainability Reporting Standards (UK SRS) are the UK government’s newest addition to the carbon reporting framework landscape. Published in final form on 25 February 2026, UK SRS S1 and S2 are closely aligned with the International Sustainability Standards Board (ISSB) standards IFRS S1 and IFRS S2.

• UK SRS S1 – General Requirements for Disclosure of Sustainability-related Financial Information
• UK SRS S2 – Climate-related Disclosures, including Scope 1, 2 and 3 emissions, scenario analysis, transition plans and climate risk governance.

UK SRS is currently available for voluntary use by any UK entity. The FCA is proposing mandatory S2 climate-related disclosures from 1 January 2027 for approximately 500 UK-listed companies, with Scope 3 emissions on a comply-or-explain basis from 2028 and UK SRS S1 general sustainability disclosures on a comply-or-explain basis from 2029.

UK SRS represents a significant step beyond SECR, integrating sustainability and climate data into mainstream financial reporting rather than treating it as a standalone compliance exercise. It requires disclosures across four pillars: governance, strategy, risk management, and metrics and targets.

CDP (formerly the Carbon Disclosure Project)

CDP is a global not-for-profit that runs the world’s largest environmental disclosure system. Organisations submit annual questionnaires covering climate change, water security and deforestation, which are scored and made publicly available.

CDP is not a legal requirement in the UK, but many organisations participate in response to investor requests, supply chain expectations or as part of their ESG strategy. CDP questionnaires are aligned with the GHG Protocol and increasingly with ISSB standards, making them complementary to UK statutory reporting.

Task Force on Climate-related Financial Disclosures (TCFD)

The TCFD framework, developed by the Financial Stability Board, established four pillars for climate-related disclosure: governance, strategy, risk management, and metrics and targets. TCFD-aligned reporting became mandatory for many large UK companies and financial institutions from April 2022.

In October 2023, the TCFD formally disbanded, with responsibility for monitoring climate disclosure progress transferring to the IFRS Foundation. The TCFD’s recommendations have been substantially incorporated into both ISSB standards and the UK SRS, meaning the framework’s influence continues through these successor standards.

Framework Comparison Summary

Conclusion

Carbon emission reporting is now a fundamental part of corporate governance in the UK. What began with mandatory carbon reporting for quoted companies in 2013 has expanded through SECR to include large unquoted companies and LLPs, with the UK Sustainability Reporting Standards set to widen the scope further from 2027.

For any large company that meets at least two of the three qualification thresholds – £36 million turnover, £18 million balance sheet total or 250 employees – carbon reporting requirements in the UK are not optional. They are a legal obligation, embedded in the Directors’ Report and publicly available through Companies House filings.

The carbon reporting requirements in the UK require organisations to measure and disclose their energy consumption, calculate Scope 1 and 2 greenhouse gas emissions, report at least one intensity ratio, describe the methodology used and outline the energy efficiency actions taken during the reporting period. For quoted companies, these requirements extend to global operations and all seven Kyoto Protocol greenhouse gases.

Beyond SECR, the broader carbon reporting framework landscape is evolving rapidly. The GHG Protocol remains the standard methodology for emissions calculation, ISO 14064 supports independent verification, CDP provides a global disclosure platform, and the newly published UK SRS integrates climate data into financial reporting for the first time.

As carbon reporting requirements continue to develop, the quality and governance of underlying emissions data is becoming increasingly important. Organisations that invest in structured, accurate and auditable data collection now will be better positioned to meet current obligations and adapt to future requirements as they emerge.

TEAM Energy’s Insights and Guidance hub provides further practical resources on energy, carbon and compliance topics to help UK organisations stay informed as the regulatory landscape continues to evolve.

Frequently Asked Questions

What is carbon emission reporting?

Carbon emission reporting is the process of measuring, calculating and publicly disclosing an organisation’s greenhouse gas emissions. It involves collecting activity data such as energy consumption and transport fuel use, converting that data into emissions figures using recognised emission factors, and reporting the results in a structured format. In the UK, qualifying organisations must include this information in their annual statutory reports.

Is carbon reporting mandatory in the UK?

Yes. Mandatory carbon reporting applies to all UK-incorporated quoted companies, large unquoted companies and large LLPs under the Streamlined Energy and Carbon Reporting (SECR) framework. SECR has been in force since 1 April 2019. The UK government also encourages voluntary reporting by organisations that fall below the mandatory thresholds.

What makes a company ‘large’ for carbon reporting purposes?

Under the SECR regulations, a company or LLP is classified as large if it meets at least two of three criteria: annual turnover of more than £36 million, balance sheet total of more than £18 million, or more than 250 employees. These are the SECR-specific qualification thresholds embedded in the 2018 regulations. Note that the general Companies Act 2006 size thresholds for large companies were raised to £54 million turnover and £27 million balance sheet for accounting periods beginning on or after 6 April 2025, but the SECR thresholds were not amended. This means some companies that now qualify as ‘medium’ under the Companies Act may still be required to report under SECR.

What is the difference between SECR and the GHG Protocol?

SECR is a UK legal requirement that mandates what organisations must disclose in their annual reports. The GHG Protocol is a voluntary international methodology that provides guidance on how to measure and calculate emissions. Most organisations use the GHG Protocol methodology to fulfil their SECR reporting obligations. The two work together rather than in competition.

What are UK Sustainability Reporting Standards (UK SRS)?

UK SRS S1 and S2 are the UK government’s new sustainability reporting standards, published on 25 February 2026. They are closely aligned with the ISSB standards (IFRS S1 and S2) and build on the TCFD framework. UK SRS is currently available for voluntary use, with mandatory application proposed for UK-listed companies from January 2027. UK SRS goes beyond SECR by requiring disclosures on governance, strategy, risk management, scenario analysis and transition plans alongside emissions metrics.

Do I need to report Scope 3 emissions?

Scope 3 emissions are not currently mandatory under SECR, but they are strongly encouraged, particularly for quoted companies. The UK government has launched a call for evidence on Scope 3 reporting, and UK SRS S2 will require Scope 3 disclosure for organisations in scope from 2027 (with a phased approach for the first reporting year). Many organisations are already reporting Scope 3 voluntarily in response to investor, customer and supply chain expectations.

What emission factors can I use for UK carbon reporting?

The government conversion factors for greenhouse gas reporting are for use by UK and international organisations to report on certain greenhouse gas emissions.

Published annually by the Department for Energy Security and Net Zero. These factors are updated each year and provide UK-specific conversion rates for electricity, gas, transport fuels and other emission sources. Organisations must use the conversion factors corresponding to their reporting period, not the year of submission.

Written by Tim Holman – Head of Consultancy, MSc, MEng, CEng, MEI
Tim directs TEAM’s consultancy practice, applying 25+ years in strategy, audits, metering, and compliance to deliver robust, audit-ready results for customers. A Chartered Energy Engineer and Member of the Energy Institute, Tim holds an MSc in Energy Conservation and the Environment from Cranfield University and an MEng in Mechanical Engineering from the University of Salford.