Assisting SMEs in the low-carbon transition

By Platform

Small and Medium Enterprises (SMEs) are the cornerstone of Europe’s economy, making up 99% of businesses in the EU, and around two-thirds of private sector employment. Correspondingly, their impact on the economy, and the environment, is significant, and their transition to sustainable and low-carbon practices will be essential for reaching our carbon emission reduction goals

However, SMEs often find it difficult to innovate and integrate new practices and approaches due to a number of barriers, including a risk-avoidant culture, a lack of knowledge and expertise, and limited personnel and financial resources. Public authorities, therefore, have sought to provide incentives and support to SMEs to help them to introduce innovations.

Audits and grants for reducing risk

Providing support from expert energy auditors, backed up with grants for part funding of implementation, has been recognised as a good solution for overcoming limited knowledge and financing, and in return, decreasing risks from investment. The approach has been well trialled across Europe, including these two practices from the United Kingdom.

In County Durham, SMEs make up 87% of established companies. To enable them to improve their energy efficiency, Durham County Council established the Business Energy Efficiency Project (BEEP), co-funded by the European Regional Development Fund (ERDF). BEEP offers free energy assessments and grants to SMEs to help them reduce their energy and water use. Firstly, an individual from BEEP’s team of auditors will perform an assessment of energy and water usage, and will provide an energy efficiency plan which presents a number of possible interventions, related from low- to high-cost. From the audit, the company can then decide which interventions to proceed with, with 40% of costs covered by programme grant. BEEP provided support to more than 240 businesses, saving more than 2,000 tonnes of carbon emissions. 

Two hundred miles south, the county of Leicestershire was facing a similar problem and established the Green Business Energy in Leicester and Leicestershire (BELLE) scheme, an ERDF funded business support project to enable local SMEs to reduce their carbon emissions through grants and energy advice. BELLE provided an energy audit and capital grant to SMEs for retrofit works, renewable energy and energy efficient technologies, analysing energy savings through 'before and after' energy bills. BELLE aims to support 150 SMEs and save almost 2,000 tonnes of CO2. As of end-2018, 98 SMEs had received grants, with more than 90 more on a waiting list for support.

The power of networks and collaboration

As well as single company interventions, public authorities have the opportunity to bring together companies to enable collaboration and to better understand their collective needs. This enables them to provide support at scale, identifying what sort of support is broadly required.

The Energig Energy Efficiency Network, in the Gävlebord region of Sweden, assisted forty-four local SMEs to implement energy efficiency measures, achieving an average of 16% energy savings per company. The Energig approach put SME owners into groups of 5-15 participants, based on similar profiles, and provided training and support on energy management issues, including energy audits and how to implement simple energy savings measures. Having set groups of participants helped to also add a social aspect to the approach, with SMEs discussing needs and challenges with each other, and comparing performance. The programme, co-funded at 50% by the ERDF, had a budget of 63 million SEK (around 600,000 EUR as of 2020) and has resulted in a follow-up programme, ENERLEAN, which continues the approach to 2022. 

The GreenHUB initiative in Joensuu, Finland, brings together six organisations to provide assistance to bioeconomy companies, particularly the forestry sector, through an open innovation ecosystem and platform. Companies can request support from the GreenHUB’s 600 experts, which can arrange tailored support, access to expert communities and workshops, as well as enable collaboration and joint research projects to answer common challenges. Since launch, GreenHUB has tackled more than 100 different business issues and developed several innovative technologies for use in regional SMEs.

Encouraging low-carbon mobility management

It is not only energy efficiency measures that companies can implement; mobility aspects can also be considered. As well as issues of logistics, there are issues related to the mobility of staff members and customers travelling to the business site.

In Graz, Austria, the city municipality set up a competition, 'Mobility Management for Companies', looking to encourage SMEs to implement mobility management measures and reduce car use by staff. The competition offered a monetary award to the five best proposals from companies, to enable them to implement their ideas. With the launch of the competition, the municipality provided training to companies, including a handbook and free consultations. In this way, even the companies that did not win came out with improved knowledge of mobility management. Two competitions were held – one in 2012 and one in 2014 – with five winners in each year, but with a total of more than 250 measures ultimately implemented.

The good practices featured in this article were gathered from the SMEPlus, LOCARBO, BIO4ECO, REFORM and SET-UP projects. Be sure to check their project websites for further good practice ideas. If you are interested in learning more about stakeholder engagement, reach out to the Policy Learning Platform team.

Image credit: Photo by SHREC 
European Union