Fears over UK energy security has led small businesses to call on government to reduce barriers preventing firms from producing their own electricity.
New research from the Federation of Small Businesses (FSB) has warned the UK also 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’, calls on the Government to “urgently” produce a new carbon plan which includes a specific strategy on microgeneration and energy efficiency across the UK’s small business community.
The trade body’s report found that ‘security of supply’ is the biggest energy concern for most small businesses (60%), while 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, the FSB said.
Mike Cherry, FSB national chairman, believes changes incentives aimed at small firms should be at the heart of the UK government’s proposed industrial strategy.
He 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.
“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.”
The FSB said around a quarter of firms believe that a low-carbon economy would create more opportunities than threats for their business. Just 14% 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%.
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 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, the FSB said.
Mr Cherry added: “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.”
