SECR at Seven: How the April 2025 Threshold Uplift Quietly Trimmed Britain's Largest Carbon Register

Streamlined Energy and Carbon Reporting — SECR — has spent seven years quietly producing the largest mandatory carbon disclosure dataset on the UK Companies House register. Introduced by the Companies (Directors' Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018, it bolted Schedule 7, Part 7A onto the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, and required every large UK incorporated company and every quoted company to report energy use, greenhouse gas emissions and an intensity ratio inside the directors' report from financial years beginning on or after 1 April 2019.

The register that emerged was not glamorous. It sits in iXBRL-tagged narrative buried in directors' reports, not in a standalone filing. It carries no penalty regime of its own beyond the standard late-filing penalty under section 453 Companies Act 2006. It is reviewed only periodically by the Financial Reporting Council. Yet by 2024 it covered, on FRC and DESNZ estimates, somewhere between 11,000 and 12,000 reporting entities — orders of magnitude wider than the Energy Savings Opportunity Scheme (ESOS) that preceded it.

That coverage figure has just moved. The April 2025 uplift to the Companies Act 2006 size thresholds — the first material rebase since 2008 — re-set the very definition of "large" that drives most of SECR's scope. The result is a quiet, unannounced contraction of the SECR population, with no transitional relief, no separate consultation, and no impact assessment specific to carbon reporting. This piece works through what SECR actually requires at seven, why the April 2025 uplift matters, and what the FRC's most recent thematic work suggests about the quality of the disclosure that remains.

What Section 414CB and Schedule 7 Actually Require

The legal hook is Section 414C of the Companies Act 2006 (the strategic report) read with Section 414CB and the detailed content rules in Schedule 7 of the 2008 Regulations. The obligation falls on three categories of preparer:

• Quoted companies (defined in section 385 Companies Act 2006 — broadly, equity admitted to the Main Market, NYSE, NASDAQ or an EEA-regulated market). They report on a global basis.
• Large unquoted companies — meeting the section 465 "large" test, which after April 2025 means satisfying at least two of: turnover over £54 million, balance sheet total over £27 million, or more than 250 employees. They report on a UK basis.
• Large LLPs — the equivalent regime via the LLP (Energy and Carbon Report) Regulations 2018.

The content required differs subtly between quoted and unquoted preparers. The table below summarises what Schedule 7 paragraphs 15 to 20 actually demand.

The choice of intensity ratio sits with the directors — emissions per £m turnover, per FTE, per square metre of floor space, per tonne of output, per room-night for hospitality. The Schedule does not prescribe a denominator, which is why year-on-year SECR comparisons across the register are so hard to aggregate.

The April 2025 Uplift and the Coverage Contraction

The Companies (Accounts and Reports) (Amendment) Regulations 2024, in force for financial years beginning on or after 6 April 2025, raised the three monetary size criteria in sections 382, 465 and 466 of the Companies Act 2006 by roughly 50%. "Large" is the relevant tier for SECR. The shift is shown below.

The employee criterion did not move. That matters for SECR, because labour-intensive businesses — engineering services, hospitality groups, contract caterers, distribution depots — often crossed the "large" threshold on headcount alone. Capital-light businesses with turnover between £36m and £54m and balance sheets below £27m have, by contrast, dropped out of the SECR perimeter entirely unless they also exceed 250 staff.

DESNZ has not yet published a refreshed coverage estimate. Working from the latest BEIS/DESNZ "business population" data and the Companies House size-band distribution, our estimate is that the post-April 2025 SECR cohort is somewhere between 2,300 and 3,000 entities smaller than the cohort that filed for FY2024 — a 19% to 25% contraction. The lost reporters are disproportionately professional-services groups, smaller retail chains and mid-market manufacturers whose financial footprint just shrank below the new line. Their underlying energy use has not changed; the regulatory record of it has.

The Energy Carve-Out: the 40,000 kWh Floor

Within the SECR perimeter, Schedule 7 paragraph 20 provides a streamlined disclosure for "low energy users" — entities whose UK energy consumption in the reporting period is 40,000 kWh or less. They may omit the detailed emissions and intensity ratio disclosures and replace them with a one-line statement that the company qualifies as a low energy user.

The 40,000 kWh threshold has not been indexed since 2018. For context, a single mid-sized office floor in central London — say 12,000 sq ft, occupied — will typically consume 200,000 to 350,000 kWh a year on lighting, HVAC and IT load alone. The carve-out is therefore designed for genuinely office-light operations: investment-holding companies, dormant intermediate holdcos that have lost dormant status by filing a small transaction, group treasury vehicles. Around 8% to 10% of in-scope filers use it, on FRC sampling.

SECR Sits Below TCFD — But Catches Vastly More Filers

SECR is the bottom of a three-tier UK climate disclosure stack. Above it sit the TCFD-aligned disclosures required by Schedule 7A of the 2008 Regulations from April 2022 for very large companies and LLPs and certain PIEs, and above that the prospective UK Sustainability Reporting Standards now being developed off the back of IFRS S1 and S2 by the UK Sustainability Disclosure Technical Advisory Committee.

This hierarchy matters because the policy debate over the next twelve months — DESNZ's "transition plan" rulemaking, the FRC's UK SRS consultation, the FCA's listed-company climate amendments — assumes SECR remains the floor. A quieter SECR floor, contracted by 20%-plus through the audit-threshold uplift, weakens the granularity of the dataset that any tighter regime will eventually have to build on.

What the FRC's Thematic Work Has Found

The FRC's Corporate Reporting Review team has repeatedly flagged that SECR disclosures, while widely complied with at the technical filing level, are inconsistently useful. Recurring criticisms in the FRC's thematic reviews of climate and energy reporting include:

1. Intensity ratios that cannot be compared year-on-year because the denominator has changed without explanation.
2. Methodology statements that name the GHG Protocol but do not specify operational versus financial control consolidation, leaving group boundary unclear.
3. Scope 2 reporting limited to location-based factors with no market-based comparator, despite a growing share of corporate PPAs in the UK.
4. Energy efficiency narrative recycled from prior years without an updated assessment of actions taken in the year, contrary to Schedule 7 paragraph 19(2).
5. DEFRA conversion factor vintage mismatches, with reporters using older factor sets than the current year's DEFRA "Greenhouse gas reporting: conversion factors" publication, distorting trend lines by 1% to 4%.

These are not novel findings, but they are persistent. Seven years in, the FRC has not yet seen evidence that SECR disclosure quality has materially improved as preparers became familiar with the regime — the criticisms in 2024 echo those of 2021.

ECCTA, Software Filing and What Comes Next for SECR Data

The Economic Crime and Corporate Transparency Act 2023 does not amend SECR directly, but its software-only accounts filing mandate — discussed in our earlier note on the end of WebFiling at Companies House — will eventually require that the directors' report, including the SECR section, is submitted in iXBRL through approved filing software. That has the potential to make SECR data far more machine-readable than the current narrative tagging permits. The Department for Business and Trade has not yet published a tagging taxonomy for SECR-specific data points; until it does, aggregating Scope 1 figures across the register remains an artisanal exercise.

The most consequential question is whether the April 2025 threshold uplift will be paired with a parallel rebase of the SECR scope. There is precedent for decoupling: the TCFD-aligned regime above SECR was deliberately set against headcount and turnover criteria that did not move with the Companies Act size thresholds. Reverting SECR to a similarly fixed perimeter — "more than 250 employees or turnover greater than £36m", say — would restore the FY2024 population at a stroke. As of June 2026, no consultation paper has been issued.

The Editorial Take

SECR at seven is a quiet success of regulatory technique: it bolted carbon disclosure onto a filing companies were already making, used the existing size-test machinery to define scope, and let the FRC police quality without creating a new enforcement body. That elegance is also its vulnerability. By tying scope to the Companies Act "large" test, SECR's perimeter moves whenever audit policy moves — and audit policy moved hard in April 2025 for reasons that had nothing to do with climate disclosure. The result is a register that has just lost a fifth of its filers without any climate-policy decision being taken. That is the wrong way around. If SECR is to remain the floor of UK corporate climate disclosure for the next seven years, it needs a scope test of its own.