Siemens Industry and the Energy Institute (EI) have advised the government that more needs to be done to instil confidence in the UK’s ability to meet its energy targets.
A recent survey suggested significant access to finance for companies wanting to invest in green technologies to reduce emissions and comply with EU and UK legislation.
In a joint poll of more than 300 senior energy specialists across the UK, only a third (33 per cent) thought it was possible for Britain to meet its 2050 energy targets to reduce emissions by 80 per cent, while more than half (55 per cent) of respondents thought the target would not be met. The remaining 12 per cent were undecided.
When asked ‘what has been your experience of British banks supporting companies who want to invest in energy-efficiency technologies to reduce their costs and save energy?’ the results demonstrated significant blockages to liquidity for companies wanting to become more energy-efficient.
Eighty-eight per cent of respondents said that banks and the financial sector were either not interested in supporting investment in energy-efficient technologies or provided ‘little feedback’.
Approximately one in 10 respondents had ‘positive feedback’ but less than 1 per cent had actually received finance for this type of investment.
Siemens Industry head of energy efficiency Stephen Barker said: ‘The government increased capital allowances in the last budget for firms wanting to invest in energy-efficient technologies and has also created the positive but still emerging Green Investment Bank, which is a good start.
“But the effectiveness of these measures is limited as there is currently a critical gap in the actual delivery of finance for investment in the wider end-user community. This is partly why businesses think we will miss our 2050 targets.
“The root of the problem is that we are often too short term in our thinking.
“What businesses need is access to affordable credit to allow them to make these types of investment, which can be capital intensive in the short term – but in the long term there is a reward of much lower energy costs, which can transform the profitability of the manufacturing sector.
“There is still an issue that end-users need to engage more with the opportunities that energy efficiency offers.”
Energy Institute chief executive Louise Kingham said: ‘To reach our carbon targets we must invest in energy-efficiency. This poll suggests business still faces barriers to doing so.
“Financiers need better knowledge around technology risk and return in different applications: signposting and access to good information for business is a must, as are the skills to install, operate and maintain technology to deliver value from such investment.
“The EI can help on each issue but the scale of the task requires government, institutions and business to work in concert.”