Banks 'failing to support energy efficiency investment'

Businesses in the UK lack support from banks when investing in energy efficiency measures, according to research from Siemens Industry and the Energy Institute.

The research, a survey of over 300 senior energy specialists across the UK, shows that only one per cent of respondents reported a secured financial investment from a bank when approached to help cover the cost of energy saving technologies. Half received little feedback to their proposals, with a further 38 per cent saying their bank was not at all interested. 

Stephen Barker, head of energy efficiency and environmental care at Siemens Industry, commented: “With Britain striving to meet stringent carbon reduction targets by 2050, everything that businesses can do to help should be encouraged. This is especially true in major energy using industries such as manufacturing. Our findings show that businesses do want to reduce their energy consumption and have ideas on how they could effectively achieve this. But we’re seeing barriers being put up from banks, which perhaps don’t understand the payback that energy efficient technologies can deliver.

“In the absence of ready financial support from banks, businesses could look to alternative methods of financing, such measures including innovative purchasing options such as energy performance contracts. These remove the need for upfront capital and allow for the investment to be paid back by savings achieved.”

The research also found that only 33 per cent of respondents thought it was possible for Britain to meet its 2050 energy targets to reduce emissions by 80 per cent, while 55 per cent thought the target would not be met. The remaining 12 per cent were undecided.

Louise Kingham OBE FEI, chief executive of the Energy Institute, commented: “To reach our carbon targets we must invest in energy efficiency. This poll suggests businesses still face barriers to doing so. Financiers need better knowledge around technology risk and return in different applications. Signposting and access to good information for companies is a must as are the skills to install, operate and maintain technology to deliver value from such investment.”