The government has launched a ‘call for evidence’ to consider proposals for a new business energy efficiency scheme aimed at SMEs.
The government suggested that a new small business energy efficiency scheme could result in an annual saving of £2.5bn and it is now seeking proposals to assess the best options available.
Government officials claim that SMEs have a “very low awareness” in regards to how they can benefit from energy efficiency due to factors such as; a shortage of information, a lack of finance options and the high cost of installing some technology; resulting in missed saving opportunities.
A spokesperson from the Department for Business, Energy and Industrial Strategy (BEIS) said: “Through the modern Industrial Strategy, we’re creating the right conditions for small businesses to thrive and exploiting the global shift to clean growth.
These proposals could help firms from hairdressers to pubs save up to a total of £2.5 billion a year on their energy bills through energy efficiency measures, while reducing emissions.”
In Wednesday’s Spring Statement, Chancellor Philip Hammond announced a ‘Call for Evidence’ which will be open until the 8th May 2019.
Following this announcement, the BEIS has outlined three options to be considered in the ‘Call for Evidence’, the options are as follows:
Energy Efficiency Auctions: The introduction of voluntary auctions set up by the government, which would see third party companies such as energy efficiency installers or energy service companies bid to provide services to SMEs; success would depend on price competitiveness.
Business energy efficiency obligation (EEO), Business ECO: An expansion or modified version of domestic Energy Company Obligation scheme. The domestic ECO scheme requires obligated suppliers to deliver energy efficiency and heating measures to homes in the UK with the costs passed on to participating consumers via their energy bill.
Expanding access to finance options: At present, businesses have three main financing options: self-funding, a bank loan or an energy service contract from an Energy Service Company.
Financing provided by an Energy Service Company is currently tailored towards large businesses and organisations, however, the government are seeking proposals on how this could expanded to SMEs.
Read the full Call for Evidence here.