Innovative SME energy solutions could be rewarded with £6 million in funding

Innovative SME energy solutions could be rewarded with £6 million in funding

A great idea deserves a great reward – that’s the thinking behind the announcement made by the government this spring.

No small business owner wants their organisation to consume more electricity than is absolutely necessary each month; nor do they enjoy the prospect of contributing to unnecessary CO2 emissions. And so it will be music to the ears of SMEs that steps are being taken to make it easier for them to improve energy efficiency.

In line with a number of proposals put forward recently by Chancellor, Philip Hammond, it was announced that up to £6 million of funding could be up for grabs to reward innovative solutions designed to encourage SMEs in commercial and industrial sectors to become more energy efficient.

The initiative comes in the form of a competition with the catchy title: Boosting Access for SMEs to Energy Efficiency (BASEE) competition. And it’s expected to address many of the most troublesome issues faced by SMEs looking to conserve energy and reduce overheads. As part of the competition, applicants will be able to pitch for a share of the funding up until the competition deadline of the 8th May 2019.

This eye-catching and potentially lucrative competition forms part of the government’s overall efforts to improve energy efficiency within businesses by 20% by 2030. It also follows proposals for a new energy efficiency scheme for small businesses which could help to unlock as much as £2.5 billion a year in savings!

There are three main categories within the competition that applicants will need to consider. These are:

  • Business models that aim to standardise elements of the investment and simplify it
  • A new form of technical tool or solution to help boost efficiency. An example of this would be a platform that provides a standardised method of assessing and displaying potential savings from a portfolio of businesses. Alternatively, the platform might match potential businesses that want to improve energy efficiency in collaboration with other companies that already possess the necessary technologies
  • Any other innovative solutions that are designed to help facilitate investment in energy efficiency for SMEs

The Department for Business, Energy and Industrial Strategy, or BEIS, commented on the initiative’s potential, stating:

“The aim of the Boosting Accesses for SMEs to Energy Efficiency (BASEE) competition is to accelerate the growth of the energy services market for SMEs by driving down transaction costs and promoting third party investment in energy efficiency projects.”

BEIS go on to say that although SMEs already pay for a small number of energy efficiency measures with short pay back periods, “the evidence suggests that external finance will be required to deliver measures with longer pay back periods which are required if we are to meet the 2030 ambition. “The competition will make available £6 million of funding for new, innovative scalable business models or solutions that reduce costs, simplify processes and encourage the take up of energy efficiency by SMEs at scale.”

The first phase of the competition includes a detailed application stage when these potential projects will be reviewed, and the best ones will be carried forward to phase two. It is expected that up to 10 projects will be approved from the initial applications, each with a value of £100,000.

At the end of this second phase, the chosen projects will then have an opportunity to develop and submit applications for further funding. This is likely to award up to five projects a possible £1 million each.

Do you run a small business? Want to start implementing efficiency measures now?

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