Jun 30 2009
The Carbon Trust is to improve access for small and medium businesses to over £100m in interest-free and unsecured loans, it was announced today. The move is intended to help more businesses survive the recession by cutting both their energy costs and their carbon footprints.
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Thousands of small businesses have already slashed their annual energy bills, some by as much as 75%, by installing new energy-saving equipment paid for by Government-funded Carbon Trust loans.
Now the Carbon Trust has extended eligibility for the recently-expanded loan fund. The minimum loan amount has been lowered to just £3,000, putting the loans within reach of micro-businesses; the upper limit has been doubled from £200,000 to £400,000 to meet the needs of small and medium businesses with high energy spends, such as manufacturing companies.
The Carbon Trust expects to deliver over £100m in loan funding to UK SMEs over the next two years, including almost £84m in England allocated by the Government as part of Budget 2009.
In most cases, businesses taking a Carbon Trust loan to update their equipment find the savings they make on energy bills exceed the cost of the loan repayments. This means they benefit from brand new equipment, increased efficiency and reduced running costs, all at no expense to themselves. They also help to drive the UK’s move to a low carbon economy.
Carbon Trust Chief Executive, Tom Delay said:
“Small and medium businesses are the backbone of the UK economy and key to the move to the low carbon world. We are extending a helping hand to them by offering more than £100m in interest-free, unsecured loans at a time when bank funding is hard to come by.
“Our zero per cent loan offer is as close to free money as a business can get, and is flexible enough to help almost any small or medium business, from the corner fish and chip shop to a factory.”
Department of Energy and Climate Change Minister Lord Hunt added:
“Climate change is one of the biggest threats to our planet so it’s vital that everyone plays their part. Taking action offers a huge opportunity for businesses to save money on their energy bills as well as reducing emissions and driving the move to a low carbon economy.
“The government is helping businesses to do just that by making over £80m of new funding available for energy saving loans for small and medium sized businesses in England, delivered by the Carbon Trust – taking total funding available to over £100m.”
What can you buy for £3,000 or £400,000?
According to the Carbon Trust, a loan of £3,000 and upwards can fund a new energy efficient boiler, refrigeration, lighting or cooking equipment for businesses such as independent retailers, franchisees and caterers.
At the other end of the scale, loans of up to £400,000 could enable medium sized manufacturing companies to fit their factories with modern, less power-hungry, production equipment.
The Carbon Trust also offers advice to businesses, including a free on-site service to help them identify the energy-saving equipment with the greatest potential to reduce their running costs.
One business owner who has recently taken advantage of a Carbon Trust loan funding is Jeff Greenall of The Cavan Bakery in Hampton Hill, Middlesex. In 2008 Jeff received an interest-free loan of £31,000, enabling him to replace the bakery’s ageing oven and electric boilers with a new energy efficient gas powered steam oven.
As a result, The Cavan Bakery’s gas consumption has dropped by 75% and it is also saving 500 units of electricity each month – savings that have helped the business counter rising energy costs and ride out current economic difficulties.
“The Carbon Trust was very helpful, and applying for the loan was incredibly straight forward,’ said Jeff Greenall. “I kept thinking ‘what’s the catch?’.”
Businesses can find more information about interest free Carbon Trust loans by calling 0800 085 2005 or visiting carbontrust.co.uk/loans