£100m green deal to slash SME energy bills

On 29th June 2009 changes were made to the size of the loan and size of enterprise supported by the Carbon Trust Energy Efficiency Loan scheme.

The Carbon Trust has improved access for small and medium businesses to over £100m in interest-free and unsecured loans. The move is intended to help more businesses survive the recession by cutting both their energy costs and their carbon footprints.

Now the Carbon Trust has extended eligibility for the recently-expanded loan fund. The minimum loan amount has been lowered to just £3,000, putting the loans within reach of micro-businesses; the upper limit has been doubled from £200,000 to £400,000 to meet the needs of small and medium businesses with high energy spends, such as manufacturing companies.

The Carbon Trust expects to deliver over £100m in loan funding to UK SMEs over the next two years, including almost £84m in England allocated by the Government as part of Budget 2009.

In most cases, businesses taking a Carbon Trust loan to update their equipment find the savings they make on energy bills exceed the cost of the loan repayments.

This means they benefit from brand new equipment, increased efficiency and reduced running costs, all at no expense to themselves. They also help to drive the UK’s move to a low carbon economy.

Carbon Trust Chief Executive, Tom Delay said:

“Small and medium businesses are the backbone of the UK economy and key to the move to the low carbon world. We are extending a helping hand to them by offering more than £100m in interest-free, unsecured loans at a time when bank funding is hard to come by.

“Our zero per cent loan offer is as close to free money as a business can get, and is flexible enough to help almost any small or medium business, from the corner fish and chip shop to a factory.”

Department of Energy and Climate Change Minister Lord Hunt added:

“Climate change is one of the biggest threats to our planet so it’s vital that everyone plays their part. Taking action offers a huge opportunity for businesses to save money on their energy bills as well as reducing emissions and driving the move to a low carbon economy.

“The government is helping businesses to do just that by making over £80m of new funding available for energy saving loans for small and medium sized businesses in England, delivered by the Carbon Trust – taking total funding available to over £100m.”

In addition, the Carbon Trust has created a new eligibility category that is governed by an organisations energy spend – allowing more businesses the opportunity to utilise the loan.

From the Carbon Trust website….

“Small or medium-sized businesses (SMBs) in England, Scotland, Wales and Northern Ireland can borrow from £3,000 to £400,000.

An SMB is defined as either an SME which itself is defined as an enterprise that employs fewer than 250 full-time equivalent employees and has an annual turnover not exceeding £43m and/or an annual balance sheet total not exceeding £37m; or an enterprise (including all other enterprises in the group) that consumes less than £500,000 in electricity per year)**.

In Northern Ireland and Wales all enterprises (i.e. including those larger than SMB) could borrow from £3,000 to £400,000.

All enterprises need to have been trading for at least 12 months.”