Small Business need their own green deal

The managing director of British Gas has urged the government to ensure its soon to be launched Green Deal domestic energy efficiency scheme is tailored to ensure small and medium sized enterprises (SMEs) are incentivised to cut greenhouse gas emissions.

"SMEs account for 45 per cent of business energy and employ nearly 60 per cent of the private sector workforce, but there's no scheme to save energy by them, either as a tax or incentive, and that needs to change," he said

He said that any new scheme should be structured more like the planned Green Deal for households, rather than the CRC, arguing that the low interest loans promised under the Green Deal would allow firms to boost efficiency measures without harming businesses' balance sheets.

"We should not introduce this as a tax on the SMEs because they're really struggling at the moment, and we will see a lot of bankruptcies if we do it that way," he said. "It needs to be neutral or a positive incentive to encourage behavioural change."

He also insisted the scheme would need to be simple to administer because the vast majority of SMEs would be unable to afford the high consultancy fees that many larger companies shelled out when registering for the notoriously complex CRC.

Under the Green Deal, households install efficiency measures with no upfrotn cost and then pay for them through their energy bills over an expected twenty years period. As a result the payments are expected to be less than the resulting savings on energy bills, meaning the household is better off.

However,  Emiroglu said SMEs should pay back their investments over a much faster two or three year period to reduce the burden of a long pay-back period.

The government has signalled that SMEs are likely to be allowed to take part in the Green Deal scheme, the details of which are expected to be announced alongside wider electricity reforms later this month.

Emiroglu added that he has already taken part in investigations being conducted by the Department for Energy and Climate Change into an SME scheme, however he lamented the fact that it may not be introduced before late 2012.

"I would like it introduced tomorrow, but it takes a bit of time fore these huge schemes to be set up," he said.