We have all seen the news concerning global warming and the need to reduce carbon emissions - and it’s alarming. Energy consumption is on the rise, energy production and supply are getting more expensive and harder to secure. Greenhouse gas emissions are increasing and are beyond the limits set for reduction and are looking harder to comply with. Energy bills are increasing and business profits are being squeezed while taxation to tackle reduction in energy usage is going up.

It is widely accepted that if we do not act immediately, our environment will change irreversibly for the worse.

Whilst UK research shows that three-quarters of consumers want to protect UK’s energy resources, businesses need to be able to contribute to these goals without the pain of it costing the earth.

However, far from costing money, an energy efficiency programme will bring tangible benefits to an organisation:

Save Money
A 20% reduction in energy use will have the same impact as a 5% increase in sales.

Customer Value
Cutting overheads means production costs will go down, making products and services more competitive.

Enhanced Reputation
Customers and businesses will increasingly only buy from, or invest in, companies with environmentally friendly policies and production methods. Demonstrating a commitment to saving energy increases appeal in the market and attracts a wider customer base.

Personnel
In addition to buying from socially responsible businesses, people increasingly want to work for that type of organisation.

Regulation
With climate change so high on the political agenda, we are likely to see more initiatives like the Climate Change Levy and the Emissions Trading Scheme, as well as tighter building regulations. Being prepared for these changes now will save time and money when they are introduced.

Typically, energy saving opportunities can be divided into three categories, No Cost, Low Cost and Capital Cost measures:

No Cost
Many actions needed to deliver savings involve little effort and no cost, such as switching off office equipment when not in use, eliminating draughts, not obstructing radiators and switching off lights and heating in vacant areas.

Low Cost
With minimal input of time and/or resources, low cost measures such as fitting door closing mechanisms, changing to low energy light bulbs, installing insulation, fitting boiler controls, time switches and thermostats together with a staff awareness program and a regular maintenance schedule will give immediate or rapid payback.

Capital Cost
Where measures involve capital investment we can assist in the procurement of no or low interest sources of funding to enable you to invest in energy saving. By embracing a ‘Spend to Save’ policy you will be able to replace inefficient equipment and hardware based on viable payback periods.

If a business paying tax at the rate of 30% spends £10,000 on products on the ETL, they will reduce their tax bill by £3,000 in the year of investment.

What We Will Do for You
A free energy audit will identify energy-saving measures and offer practical advice on how they can be achieved. Savings identified will usually be between 10% and 30% of energy bills, and recommended measures will include no and low cost common sense measures which tend to pay for themselves immediately or within a few months.

We can assist in sourcing for capital cost measures from organisations such as the Carbon Trust via the Energy-Efficiency Loans and Enhanced Capital Allowances Scheme:

Energy-Efficiency Loans
The Carbon Trust offers interest free Energy-Efficiency loans to qualifying organisations with the potential to invest in energy-saving projects that replace or upgrade existing equipment. The amount borrowed must be between £5,000 and £100,000 and is repayable in up to 48 equal instalments with 0% interest.

The scheme is open to private sector small-and medium-sized organisations The two-stage application process is straightforward and it can take as little as 4 weeks from initial contact for a successful applicant to receive a loan offer.

In order to qualify for an Energy-Efficiency Loan we first establish the initial eligibility of the organisation: it must be an SME and must not fall within a restricted sector. Secondly, we determine the cost-saving and energy-saving potential of the proposed project; to qualify the estimated value of the energy saved over 5 years must exceed the loan amount. A credit check is performed in all cases.

Enhanced Capital Allowances Scheme
The Enhanced Capital Allowance (ECA) scheme was established to encourage UK businesses to invest in energy efficient equipment. The scheme provides 100% first-year allowances for spending on equipment that meets published energy-saving criteria in the Energy Technology List (ETL) managed by the Carbon Trust. Through claiming an ECA, businesses can claim a reduction on their business’s taxable profit of the full cost of spending in the year the investment is made. This provides a helpful cash flow boost and a shortened payback period in addition to cost savings from reduced energy bills.

The Energy Technology List was set up to identify those products qualifying for ECA tax relief and which offer energy efficiency savings and currently features over 6,000 products.

How to claim an ECA

• Identify equipment that appears on the Energy Technology List.
• Purchase the qualifying product and retain a supplier’s invoice as documentation
  for your records.
• Complete the ECA box on your business’ tax return.

We can also consider your energy charges and offer alternative solutions to better utility procurement options. We are able to assist in all aspects related to your utilities, including dispute resolution, bill checking and new or increased supply connections.

If you would like a no obligation discussion as to how we can help,
please contact us on 0191 5197256, or e-mail us at enquiries@sq-one.co.uk