The British government is encouraging UK businesses to take advantage of its matching funds offer and invest in energy efficiency measures that will help bring down their energy costs, allowing them to compete better with US businesses that have benefitted from lower energy costs, thanks to the rise of shale gas.
Residential and commercial energy efficiency measures have played a major role in the UK’s efforts to meet ambitious carbon reduction goals. But as energy costs have soared across Europe in recent years, energy efficiency has now become essential to be competitive. Competing with rivals located in countries where energy is cheaper has been a major concern for British businesses, as cost pressures increase. But improving energy efficiency requires serious financial investment in projects and companies have hesitated to take that risk.
At a green technology forum launch in Edinburgh, Scotland last week, British cabinet secretary for business, Vince Cable, focused on how the private sector has missed opportunities for big energy savings because companies are too risk-averse to invest in new technology. Cable highlighted the government’s efforts to encourage such investments, with initiatives such as providing matching funds to reduce the risk involved in capital-intensive projects, from institutions such as the Green Investment Bank.
Begun five months ago with the aim of providing financial support for low-carbon infrastructure, the Green Investment Bank has already invested $988 million in industrial energy efficiency. One of the areas of focus is powering hospitals, for which it announced a $27 million investment in March, for an energy innovation center at Cambridge University Hospital. The bank has also secured $3.58 billion in private funding.
Cable said the funds will remove uncertainty and help private investors on the brink of investing to make the decision to go ahead. At the forum, participants raised the issue of how difficult it is to convince the public and companies to adopt energy and cost saving policies. Delegates said the challenge in the commercial sector is convincing companies to invest when they have to wait more than three years for a return on their investment, The Scotsman says.