UK lagging Germany in green growth, say businesses

The Carbon Trust questioned over 700 British business leaders about investing in the market, but only one in eight believe the UK is the most prepared to take advantage of the £3.2 trillion global low carbon goods and services market.

Business leaders ranked Germany as the most able to capitalise on the green economy and the UK on a nearly level playing field with the US, China and Japan.

R&D investment
While 92 per cent of those surveyed said their businesses could benefit from green growth, only a third are currently investing in R&D to create more sustainable products and services.

A third of business leaders also said they see potential risks in investing in green growth. They said having strong leadership and a solid goal and strategy in place are the keys to being successful in the green economy, which is already worth £112 billion in the UK alone.

Some business leaders may not be choosing to invest in the green market because only 31 per cent expect their profits to increase from doing so. Over 75 per cent believe the largest benefit from such investments is having a better reputation.

RLtec
Despite the belief in some risks, there are companies investing in green goods and services. RLtec has developed a way to regulate appliances so that they can be turned off for a length of time without decreasing their ability to perform properly. By doing so, electricity use can be decreased in both domestic and industrial appliances.

RLtec is conducting a large-scale trial with over 1,200 fridges, as well as working to install the technology in 200 Sainsbury’s stores in the UK for 10 years.

The green sector employs 900,000 people in the UK, three per cent of all jobs, and business leaders surveyed believe the numbers will only continue to grow over the next five years.

Call for green incentives
Because of this, 30 businesses, including PepsiCo UK and Ireland and RLtec, have signed an open letter, urging the Government to remove regulations that hinder such growth and offering incentives to increase investment in low-carbon goods and services. They cite the expected economic growth rate of four per cent per year for the next five years as reason to encourage business in the sector. They also believe this is necessary to help UK recover from the economic downturn.

CEO of the Carbon Trust, Tom Delay said: "Green growth is the only show in town. No other sector can drive the recovery. The consequences of British business failing to grasp this opportunity are almost too horrific to consider: anaemic growth, a jobless recovery and the risk of a return to the economics of boom and bust. We cannot afford to carry on as we did before.

"Businesses need to look beyond the short-term financial reporting cycle and place some smart, early bets on the future. Otherwise the cost, both to the UK’s economy and to the environment will be too great to ignore."

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