techUK Response to BEIS Consultation on Carbon and Energy Reporting

BEIS’ consultation on streamlined energy and carbon reporting follows the decision to scrap the deeply unpopular CRC Energy Efficiency Scheme after the 2018/19 compliance year.

Government is considering how to replace the reporting element of the scheme and is considering: mandatory annual reporting through company accounts; new qualification thresholds to capture a larger population of businesses; and whether companies should also publically disclose what action they have taken on energy efficiency.

UK quoted companies are already required to report annually on their greenhouse gas emissions, including those emitted outside of the UK, in their annual reports. The government is intending to retain this requirement but asks whether global energy use should also be disclosed.

In its response, techUK calls for government to:

Set minimum requirements: techUK is concerned that the proposals outlined by the government in this consultation represent a far more onerous approach than we had anticipated. It fails to recognise that greenhouse gas measurement and reporting is now a mainstream activity of the world’s leading companies, and has become part of the overall business strategy. However, for other, less motivated companies, perhaps because energy and carbon is considered to be neither a strategic, reputational or cost issue, there is a role for government reporting schemes to provide guidance on what to measure, how to do it and how to disclose that information.

Go with the grain of existing best business practice: We support the government’s intention to exclude CCA and EU ETS energy use/emissions from reporting obligations. But we believe this should go further by exempting all businesses participating in recognised reporting and disclosure frameworks, equivalent measures, such as the CDP and TCFD.

Move away from box ticking and encourage a narrative approach: It is the experience of our members that a narrative approach, underpinned by appropriate metrics, describing the work that has been undertaken to address energy use and carbon reduction and the work that is planned in future is a far more effective way to encourage and demonstrate continual progress whilst ensuring previous activity is fully recognised.

Set appropriate thresholds: We believe that the ex-CRC qualification threshold would be an appropriate threshold. This should be reassessed annually, with the option for companies which fall below the threshold to continue reporting should they wish to do so. However, disclosing energy use and, in some cases, disclosure against certain energy intensity metrics, can be commercially sensitive.

Give companies the opportunity to either report via reports or via their website: Carbon reporting should be accessible but we question whether company reports are the right vehicle for this information in all cases. Rather, it should be left to companies to either disclose in their annual reports, or if more appropriate, provide a link to the information in a prominent place on their website.

For more information, please download our response in full.

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