UK SMEs are wasting over £82m on surplus energy, study finds

Green SME news – by GreenWise staff

14th October 2015

Small and medium-sized commercial office businesses in the UK are overspending by over £82 million per annum on their energy bills as a result of inefficient technology and old equipment, according to new analysis.

The Energy Efficiency Financing (EEF) scheme, a joint initiative between the Carbon Trust and Siemens Financial, looked at the energy expenditure of selected key industries to estimate their annual energy overspend. It concluded potential energy savings of over £414 million could be achieved per year by the UK’s service sector SMEs (of which over £82 million is represented by small and medium-sized commercial office businesses), were they to invest in more energy-efficient equipment. The findings are based on proprietary data and official sources and looked at each sector’s use of lightingheating and hot watercooling and ventilation, and other areas of energy consumption.

The EEF scheme launched in 2011 to unlock business investment by providing finance for green technologies, such as low energy lighting, solar PV, energy-efficient motors, low carbon air conditioning or biomass heating. The scheme aims to make finance for the acquisition of energy efficient and renewable energy equipment more accessible and affordable for companies, in particular SMEs.

Myles McCarthy, managing director of Carbon Trust Implementation Services, said: “By investing in energy-efficient equipment as well as renewable energy technology, businesses can reap significant energy savings and cut down on their energy bills. Any sort of green investment is a step towards saving money, improving business competitiveness, and being a responsible citizen. Organisations that recognise the long-term benefits brought by energy efficiency will no doubt be better positioned than their competitors to grow their businesses more sustainably and profitably.”

Data from Bank of England shows the annual growth rate in the stock of SME lending to have shrunk since the second quarter of 2009. Although there are some recent signs that this trend may be turning the corner, the EEF scheme says business lending will take a long time to recover, and may not reach pre-financial-crisis levels because of stringent recent regulatory rules.

Richard Baker, sales manager, Energy Efficiency Financing scheme, commented: “Today’s tightened credit environment makes it increasingly difficult for SMEs to obtain affordable funding as traditional lenders have become more risk-adverse in their lending policy.”

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