Research from Siemens Industry and the Energy Institute (EI) shows that businesses in the UK lack support from banks when investing in energy efficiency measures, with nearly nine out of ten businesses (88%) having a negative experience. Siemens is calling for a greater role for the Green Investment Bank in supporting the SME market.
The research, a survey of over 300 senior energy specialists across the UK, shows that only one respondent reported securing a financial investment from a bank when approached to help cover the cost of energy saving technologies. Half (50%) received little feedback to their proposals, with one in five businesses (19%) saying their bank was not at all interested.
Stephen Barker, Head of Energy Efficiency and Environmental Care at Siemens Industry, commented: “With Britain striving to meet stringent carbon reduction targets by 2050, everything that businesses can do to help should be encouraged. This is especially true in major energy using industries such as manufacturing. Our findings show that businesses do want to reduce their energy consumption, and have ideas on how they could effectively achieve this. But, we’re seeing barriers being put up from banks, which perhaps don’t understand the pay-back that energy efficient technologies can deliver.
“Government, to a degree, has tried to alleviate these problems, by increasing capital allowances in the last budget for firms wanting to invest in energy efficient technologies and has created the Green Investment Bank. However, the actual effectiveness of these steps is limited due to the critical gap in the delivery of finance for investment.
“In the absence of ready financial support from banks, businesses could look to alternative methods of financing, such measures including innovative purchasing options such as energy performance contracts. These remove the need for upfront capital and allow for the investment to be paid back by savings achieved.”
The research also found that only a third of respondents (33%) thought it was possible for Britain to meet its 2050 energy targets to reduce emissions by 80%, whilst more than half (55%) thought the target would not be met. The remaining 12% were undecided.
Louise Kingham OBE FEI, Chief Executive of the Energy Institute commented: “Driving behaviour change, reducing our carbon emissions and keeping the lights on are some of the biggest challenges facing the energy sector. Where businesses are keen to make changes to their own operations to maximise energy efficiency, they should be encouraged. Creating a safer and more secure, sustainable and affordable global energy system is one of the most important issues facing policy makers, researchers and energy industry figures today. There must be joined-up thinking across all stakeholders to ensure technology integration and drive a step change in investment. The EI works across the sector to deliver knowledge, skills and good practice but more needs to be done to develop systems-based thinking and engage Government, financial institutions and industry.“
For further information from Siemens Industry please visit www.siemens.com/drives