September 18 Newsletter 13th September 2018
Streamlined Energy & Carbon Reporting
The Government have consulted on the future for energy and carbon reporting to follow on from the closure of CRC, final reporting July 2019, and the corresponding substantial increases in the Climate Change Levy on energy bills (49% electricity, 71% natural gas) from April 2019. The Government’s response is to introduce Streamlined Energy and Carbon Reporting SECR that will be mandatory for all quoted and unquoted companies and limited liability partnerships that are defined as large companies within the Company Act (250 employees, or £36m annual turnover and £18m on balance sheet). This mandatory reporting is estimated to be required by 11,900 organisations across the UK from April 2019.
Importantly, this reporting will follow the ESOS model and hence Briar Associates recommend that where we are working to draw up your ESOS Assessment 2019 (Phase 2), we should align the assessment year with that of the company accounts, so that the data can fulfil both requirements.
The SECR reporting in the directors report of your company accounts will require a number of elements including:
- Energy Consumption, kWh
- Carbon emissions, tCO2
- Comparison of accounts year energy/carbon data with preceding year
- Energy Intensity metric
- Narrative on energy efficiency action
We advise that it will be valuable to cover these issues off within your ESOS Phase 2, so that we can pre-prepare the data/information for your accountants to incorporate your SECR into your directors report.
There will be further detailed guidance from BEIS on the detailed requirements of SECR in Autumn 2018.
In the meantime, if you would like to discuss SECR, or ESOS, with an ESOS Lead Assessor, please contact us and we will be pleased to provide advice.
CURRENT MARKET POSITION
Wholesale energy prices have continued their upward trend throughout August with prices being driven by gas supply issues. A combination of planned and unplanned outages across the UK and Norway (who supply a large proportion of gas to the UK to cover shortfalls) have limited gas availability and driven prices up.
This has been exacerbated by storms along the US Gulf Coast which shut down several oil platforms and a further drop in Iranian oil production ahead of further US sanctions.
The global pressures on oil and gas along with the ongoing planned outages closer to home mean that there has been little opportunity to recover the position to cover the downturn in temperature across the UK.
Electricity prices have risen as a result of the oil and gas issues and further pressure has come after outages at two nuclear reactors in Belgium which were scheduled to return to operation in September, but will now be out of action until December.
To complete the picture, carbon traded at above €25 per tonne for the first time in a decade, sparking increases in electricity costs across Europe.