Green business grants and funding options

Saving energy and being ‘greener’ is something we’re all becoming more aware of thanks to news of global warming and rising energy costs. As a business owner, you may be wondering about how your business can become greener; but understandably, you may be concerned about the costs involved. Whether your motivation for becoming greener is out of an altruistic desire to ‘do your bit’ or is simply because you know that cutting your energy usage will reduce bills is irrelevant. You want to do the right thing for the environment, and that is a great thing!

There are many government- and charity-funded grants available to businesses that want to take a step towards becoming greener and more energy-efficient. Some green business grants are available on a national level – that is, any business in the UK can apply for them. Other green funding options are available on a local level. Some are funded by the EU, so are available to any eligible business or individual in the European Union.

UK-wide green business grants

There are a variety of green business grants available at the moment. Some help businesses install green energy measures such as air source heat pumps, ground source heat pumps and solar panels. Others are designed to help businesses buy green vehicles to reduce their carbon emissions. There is even a grant to help businesses which transport goods to and from other countries to use greener alternatives to transporting via road networks such as short sea shipping, rail and inland waterways. As for waste – there are several grants available to help you minimize your impact on the environment by reducing waste and recycling or reusing items instead of throwing them away.

Work out which green funding option(s) will work for your business

To get the best out of any grant, you need to make sure you apply for something that is relevant for your business – for example, a business that doesn’t operate any vehicles would get little use out of a grant to help them buy low-emission vehicles.

Work out what you want to achieve from a green business grant – is it to reduce your ongoing costs by cutting your energy usage, or is it to enable you to develop new, environmentally-friendly products?  If your goal is to reduce your carbon emissions (thus reducing your energy costs) then you will have to provide details to the funding body as to how this will be achieved. The more detail you provide, the more likely your proposal will be accepted.

You may have to supply a copy of your business plan, as this will provide evidence that your business is trading successfully. Include details of how the grant would enable you to reduce your energy usage – if you can estimate how much energy can be saved with your proposal then you are much more likely to have it approved.

Work out how long your proposed project is likely to take. Factor in some contingency time, so if a third party lets you down on a delivery or service during the project you have enough time to ‘catch up’. There may be certain milestones throughout the project, so document what they will be and when you expect to reach them. Similarly, factor in the costs of each milestone throughout the project.

How to find out about green business grants

There are a lot of resources on the internet offering advice and information about the various green funding options available. These organisations should help point you in the right direction though, so you don’t have to spend hours surfing the net!

If you get rejected

It’s never nice to be the subject of a rejection, but you must remember that many of the grants available have a limited supply – that is, once the cash is gone, it’s gone. Additionally, many green business grants are highly competitive, especially those running on a national scale or those funded via the EU. If you do get rejected, then make sure to ask why you were rejected. Perhaps you neglected to provide some important information, which can easily be fixed. If you can’t reapply, then take a look at other similar options for green funding available. There may be a local green business grant available which you could apply for instead, so check with your local authority.

If you get rejected for funding, but still want to go ahead with a green project, you may want to consider taking out a bridging loan or by releasing equity from your business premises with a commercial remortgage. Get in touch with the team here at Commercial Trust to discuss your options.  

This information should not be interpreted as financial advice. Commercial mortgage rates are subject to change. Speak to our advisors for a mortgage illustration.