Carbon Trust launches 'Big Business Refit' for SMEs

The programme will make £100 million in loans available and offer SMEs advice to help to reduce energy bills by replacing old, inefficient equipment with new, energy-efficient models. It is expected to help up to 3000 UK SMEs reduce their annual energy costs.

The Carbon Trust is able to offer unsecured, interest-free loans repayable over a period of up to four years that can be used for equipment replacements costing between £3000 and £400,000. The loans are designed to ‘pay for themselves’ through direct energy savings, so that once the loan is repaid, savings go straight to bottom line.

The Big Business Refit follows a recession-driven surge in demand for the Carbon Trust’s interest-free business loans. In the first six months of 2009, hundreds of SMEs were given loans at zero-interest to equip their businesses with the latest energy-saving technology. As a result, the Carbon Trust claims they are saving an average of £14,000 each on annual energy bills.

Chief executive of the Carbon Trust, Tom Delay, said: “Business owners are realising that for every month they ‘make do and mend’ with old, inefficient equipment, they are wasting more cash on unnecessarily high energy bills. With credit all but dried up elsewhere, the Big Business Refit breaks the deadlock by helping SMEs to buy the equipment that will slash their costs.”

The Big Business Refit service is open to UK businesses with less than 250 employees and a turnover of less than €50 million (£44 million) and will provide qualifying SMEs with a free energy-saving assessment and a tailored action plan that identifies the savings that could be made by replacing energy-guzzling equipment.

SMEs have taken Carbon Trust loans to make green improvements, for example fitting energy-efficient lighting, that will also put them in a strong position once the green shoots of economic recovery appear.

Ipswich-based aluminium foundry, Hadleigh Castings Ltd, is one of the hundreds of companies that have recently improved their business with a Carbon Trust loan. It replaced its largest air compressor at a cost of £30,000. Installed at the end of 2008, the new compressor is on target to save the company over £11,000 every year on its energy bill and around 80 tonnes of CO2 a year.

Managing director Neville Warnes said: “The loan is zero-interest, so you don’t need to worry about rates increasing before you’ve paid it back. And you get the feeling [The Carbon Trust] genuinely wants you to receive the loan and get the work done.”

David Caro of the Federation of Small Businesses commented: “The Carbon Trust’s interest-free energy efficiency loans help small businesses significantly cut their costs over the long-term as well as helping them to play their part in moving
towards a low carbon economy.”

“Businesses which replace old equipment now will be in a far better position come the end of the recession. Their cost base will be lower than their competitors and, with brand new equipment in place, they’ll be more efficient,” added Mr Delay.