A major new survey of business opinion has found that over a third of firms believe that the most important thing the government could do for businesses to improve the take-up of â€œgreenâ€ measures is to provide grants towards the costs.
The survey of over 2,100 businesses in England and Wales was conducted by the British Chambers of Commerce and British Gas.
Commenting on the findings, Mike Spicer, Director of Research and Economics at the British Chambers of Commerce (BCC), said: â€œThese results demonstrate that getting the economics of investment right for energy efficiency is crucial to promoting take-up.
â€œAt a time when businesses face growing upfront cost pressures from other sources, grants and tax breaks have an important role to play in offsetting the cost of new energy efficiency measures. On its own, more information wonâ€™t do the job.
â€œCommercial landlords also need to do more, to support leaseholders and renters who are looking to save money and make their energy use work for them.â€
Key results in the survey:
â€¢ The largest share â€“ 36% â€“ of the businesses surveyed feel that the most important thing the government could do for business is provide grants towards the cost of installing energy efficiency measures
â€¢ Only 8% feel that more information would help them in this aim, while just 4% say that financing options such as lease agreements and low-cost loans would help
â€¢ Only 13% of businesses have seen a decrease in their energy costs over the last three years, compared to 35% that have seen prices rise, and 37% with little or no change
â€¢ When asked what is preventing businesses from investing in energy efficiency measures, 23% of the largest firms said that other investments were taking priority, compared with 13% overall, and 15% of businesses state that savings would not be worth the cost of investment
â€¢ Just over a quarter â€“ 27% â€“ of businesses who rent their premises state that they have no influence on energy efficiency improvements
â€¢ Only 6% of businesses say that the wider use of smart meters is the most important thing that government and suppliers could do to help firms
Lee Petts, managing director at growth-focused sustainability, CSR and environmental consultants, Remsol, says that businesses can do more to lower their energy costs without having to invest: â€œWe often encounter businesses that say they want to invest in energy-efficiency measures like replacing fluorescent lighting with low-energy LEDs but canâ€™t afford to without grant help â€“ and yet, when we scratch beneath the surface, we find the same companies are still leaving office equipment on overnight, opening windows in the summer even though the air-conditioning is running, and not turning off lights in unoccupied rooms.
â€œUntil youâ€™ve got to grips with the basics like these, thereâ€™s simply no point in making capital investments.â€
Energy saving tips to reduce costs
Lee suggests that businesses wanting to cut energy use and costs follow these steps:
1. Measure your energy use and look for patterns and trends.
2. Check with your energy supplier to see if youâ€™re on their cheapest tariff. Consider switching supplier for a better deal.
3. Think about clubbing together with neighbouring businesses to buy energy collectively in order to access bigger discounts.
4. Improve building insulation. Consider commissioning an infrared survey to look for â€œenergy leaks.â€
5. Educate staff about energy saving.
6. Install low-cost occupancy sensors in areas that arenâ€™t heavily trafficked by people, like toilet areas.
â€œThe benefit of undertaking measures like these first is that you can achieve them at little or no cost. Once youâ€™ve got on top of these cheap wins, you can then start to consider more costly capital investments â€“ but, again, donâ€™t make the mistake of simply assuming you need to replace one energy-consuming device with something that uses less energy, there may be alternatives. For example, you could explore the use of â€œsun tubesâ€ to bring more natural light into first floor rooms, avoiding the need for and ongoing running costs of artificial lighting.â€
Make the most of enhanced capital allowances
If youâ€™re a business that pays income or corporation tax and you do invest in capital equipment, youâ€™ll be able to claim 100% first year capital allowance on a product if itâ€™s on the Energy Technology List (ETL) at the time of purchase.
The ETL is a government-managed list of energy-efficient plant and machinery, such as boilers, electric motors, heat pumps, high speed hand dryers, pipework insulation, solar thermal systems, warm air and radiant heaters, and air conditioning and refrigeration systems that qualify for full tax relief. For a product to be on the ETL, it must meet specific energy-saving or energy-efficient criteria. It is part of the Enhanced Capital Allowance (ECA) tax scheme for businesses.
You can search the ETL here.