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Community energy

Power plan unplugged without small firms

New research from the Federation of Small Businesses (FSB) warns the UK risks failing to meet its climate obligations without the help of small businesses.

FSB’s latest report, ‘The Price of Power: Energising small business in the next UK Carbon Plan, shows how with improved incentives and fewer barriers, small firms can be key to closing the carbon gap.

It calls on the Government to produce urgently a new carbon plan which includes a specific strategy on crucial areas such as microgeneration and energy efficiency across the UK’s small business community.

Our research finds that ‘security of supply’ is the biggest energy concern for most small businesses (60%). Nearly nine in 10 (86%) small businesses believe the UK is too reliant on imported energy.

Making it easier and more attractive for small firms to contribute to the generation of green energy would both help to meet carbon targets and make the UK more self-sufficient with supplies.

FSB National Chairman Mike Cherry said:

“The UK energy sector is facing the greatest transformation since the Industrial Revolution. But the whole system for incentivising and subsidising infrastructure lacks transparency, consistency, direction and ambition. It needs a strategic overhaul.

“The Government should produce urgently an updated carbon plan, looking specifically at small businesses as an audience. Without the input of an engaged and empowered small business community, the UK risks failing to meet its binding emissions targets.

“Our research shows small firms want energy security to be a priority. Brexit raises yet more questions about the UK’s future power supply. Infrastructure costs must be shared out equitably with small firms playing a pivotal role in securing Britain’s energy future.”

Around a quarter (27%) of firms believe that a low-carbon economy would create more opportunities than threats for their business. Just 14 per cent thought the opposite.

One in 10 (12%) small businesses generate their own energy, mainly using solar panels. But more needs to be done to encourage the other 88 per cent.

FSB’s research also shows three in five (58%) small firms have made changes to improve the energy efficiency of their business. But again, many are disempowered or not given enough incentives to make further improvements.

The next UK carbon plan should promote microgeneration, including for the roughly half (46%) of small businesses who rent their premises. There also needs to be a review of the effectiveness of subsidies and incentives to help small firms climb over the hurdles to energy investment.

Mike Cherry

The UK’s massive investment in energy infrastructure will come at a heavy price to customers, so it’s important that the benefits are fair and accessible for small businesses. Poor investment planning could place the greatest cost burden on those that can least afford it and restrict new opportunities to a lucky few.

“Many small businesses are willing and capable of becoming more energy efficient, and even generating energy. With the right support, they can play a critical role in helping the UK reach its green targets and shore up supply.

“I hope that these important points are not only taken on board in the Government’s green energy programme, but also as part of its wider Industrial Strategy.”