Carbon Compliance

Business Insights

Will your organisation be mandated to comply with the latest compliance carbon compliance schemes?

We are now in the second phase of the Energy Savings Opportunities Scheme (ESOS), and from 1-April 2019 Streamlined Energy and Carbon Reporting (SECR) comes into force. Both schemes have similar, but different rules for inclusion; the three metrics are employees, turnover and balance sheet.

ESOS sets the criteria as:

  • More than 250 employees OR
  • Turnover > €50 million (˜£43.9 million) AND balance sheet > €43 million (˜£37.8 million)

Whilst SECR sets the measures as two from the following three criteria:

  • More than 250 employees
  • Turnover > £36 million
  • Balance sheet > £18 million

For many organisations it will be clear they will be in both or neither schemes, others could be in one and not the other. Also under the two-year rule within ESOS some organisations in Phase-1 may not be required to comply with Phase-2 and conversely some not in Phase-1 may now be mandated to comply with Phase-2.


- mandates organisations to measure their total energy consumption (TEC) including transport, identify their significant energy consumption (SEC), have in place compliance activities covering this SEC and notify the relevant regulator.

In Phase-1 most organisations complied via energy audits, which have to include site visits, 12-months data analysis (including profiling), and cost-effective energy efficiency improvements through recommendations.

All compliance activities (unless all the organisation’s energy is fully covered by ISO 50001) must be signed off by at least one director and an accredited lead assessor, before notification is made to the appropriate regulator.

Due to the limited number of lead assessors, qualifying organisations should already be preparing for Phase-2. However, it won't be possible to make the compliance notification until after the reference period. It is advisable to make a start as soon as possible to ensure high quality and timely compliance. The Environment Agency are currently issuing fines from Phase-1 to non-compliant organisations, the highest to date is £45,000.


– to be introduced following the end of CRC in March 2019, SECR is an extension of the Mandatory Greenhouse Gas Reporting Legislation (MGHG) affecting quoted UK companies.

Quoted companies - required to comply with MGHG reporting will still be required to disclose global Scope 1 and 2 emissions (scope 3 is voluntary), and an intensity metric. Additionally, there is now a requirement to report on global energy use.

Unquoted companies - will be required as a minimum to report their UK energy electricity, gas and transport (road, rail, air and shipping) and an intensity metric.

SECR reporting is via company annual reports, including a narrative on energy efficiency actions taken.

[1] The actual exchange rate on 31-Dec 2018 is to be used, consequently exact sterling figures cannot be quoted.

Act now to ensure compliance with both Phase-2 of ESOS and SECR. ESOS lead Assessors are not plentiful, collection, analysis and reporting of data can be a long process if systems are not already in place.

Call today to talk through how we can help: 0161 448 7722

Envantage Limited Energy & Low Carbon Specialists

Envantage is an independent consultancy with a wide range of client organisations, who rely on us for unbiased advice. The company was incorporated in April 2004 by experienced professionals within the energy supply industry with a vast knowledge of energy procurement, energy efficiency and legislation. Over the years, we've built up an impressive range of energy management and carbon reduction services for our many and varied clients.

Envantage are specialists in Energy & Low Carbon Management. We help organisations manage their energy and carbon reduction through a comprehensive portfolio of services that help cut energy spend and ensure regulatory compliance. A key aspect of our role is to assist organisations with their compliance with various carbon schemes.

We also help companies establish their green credentials and lower their carbon emissions. We advise clients on green taxes, energy procurement strategy, micro-generation and good utility management. Envantage has a strong team of experienced Lead Assessors, certified to provide Energy Audits to ISO 50002 standard.