Phil Houlder, Glenfield Electrical, works directly with local businesses on energy efficiency and clean upgrades. His recent survey of 40 SMEs reveals the biggest barriers to ‘going green’.
Electricity bills are soaring and putting small and medium-sized enterprises (SMEs) under pressure. At the same time, companies across the UK are being told they need to play their part in getting the UK to net zero by 2050. For many SMEs, that creates a twin pressure of rising operational costs on one side, and growing expectations from government to invest in sustainable changes on the other.
As electrical contractors, we speak to business owners every week. Most are not anti-sustainability, far from it. They know that energy prices are becoming a challenge, and carbon reduction is rising up the agenda with customers and supply chains. But they are also trying to manage cash flow and rising costs across the board.
This is why we recently carried out our own research and produced a whitepaper looking at where local businesses in Leicestershire ‘are at’ with their energy efficiency, what they’ve already implemented and what barriers are in the way of further energy saving measures. We also spoke with local experts in utilities and funding to explore how these smaller businesses can finance upgrades to get the most benefit.
Why we produced a whitepaper
We know LED lights are way more efficient than fluorescents, electric vehicles are much cheaper per mile, and solar panels and batteries power premises all over the world. Despite this, when we talk to local business owners, they have a lot of the same questions. Will this save me money? Is it worth the upfront cost? What happens if prices change again?
These are barriers we see repeatedly, and they reflect a wider challenge within the UK’s Net Zero 2050 and Heat and Buildings strategies. Most of the buildings that will exist in 2050 are already standing today, which means the transition will depend far more on upgrading and improving existing premises than building new ones.
What we did?
With the help of a local PR firm, we surveyed 40 local SMEs, and asked about their monthly energy costs, whether they monitor usage, how concerned they are about rising bills and what measures they have already implemented.
Additionally, we backed that up with some follow-up interviews with local business owners to find out more and see if there were any insights that fell between the gaps of our questions, and there were plenty of viewpoints that did.
What we found
More than four in five responses came from businesses with fewer than 25 employees, so the picture here is very much about SMEs. In my view, if the net zero transition is going to work at this level, it must be driven by people and advisers who understand how smaller firms operate day to day. Large, top-tier organisations often sit too far from the realities of SME decision-making.
So, what did our survey find? It revealed plenty of intent, but interestingly not much follow-through. More than 80% wanted to cut their carbon footprint and 60% were concerned about rising energy costs. Yet almost half did not monitor their energy use, and 87.5% did not know their supplier’s renewable mix.
Most action focused on lower-cost measures such as LED lighting at 52%. Higher investment steps like solar at 10% and battery storage at 2.5% were rare, with funding clearly a barrier.
Crucially, 85% were not aware of any grant or support schemes available to them. That points to a clear disconnect between the ambition behind policy and what is reaching businesses.
Additionally, the interviews found that good, independent advice was difficult to find and that landlords were often a barrier to solar PV, even when the tenant was willing to pay.
Funding options
We spoke with local renewable funding specialists, who shared with us some practical advice on making green upgrades stack up financially.
Asset finance, hire-purchase, PPAs or leasing options are available for solar, LED lighting and battery storage to SMEs, with investments from as low as £2,000. When structured properly, repayments can sit alongside, or even be covered by, the energy savings, helping to protect cash flow.
Businesses should focus on total repayment costs and realistic savings rather than headline rates and remember that initial advice and scoping are usually free.
Schemes such as the Annual Investment Allowance can also help offset qualifying investments against taxable profits, improving the overall case, particularly for solar installations.
What we are doing next
Off the back of our findings, and in line with the Government’s push for electricians to play a stronger role in educating businesses on green and clean energy, we plan to develop a series of sector-specific guides for local companies. Drawing directly on the survey insights, the aim is to give business owners straightforward advice that helps turn interest in sustainable practices into manageable changes.
SMEs need all the help they can get right now. But it’s clear that there is a win-win situation for them – reduced energy bills and carbon footprint – if they get sound advice from good sources.
