Paying for your Energy Efficiency Measures
Paying for your Energy Efficiency Measures
For many energy efficiency improvements it should be possible to obtain internal funding given the significant benefits available. However, energy efficiency will always be competing with other potential investments within a business. This section summarises some of the opportunities available to improve the financial case for an energy efficiency investment.
Grants and Low-Cost Loans
Grants, generally from public funds, are sometimes available to assist with the capital costs of an energy efficiency investment. Low-cost or interest free loans for energy efficiency investments also are sometimes available, particularly for SMEs. The nature of grants and low cost loans sometimes apply only to a specific region.
For information on current schemes available visit the web-sites of the Carbon Trust www.carbontrust.co.uk and the Energy Saving Trust www.energysavingtrust.org.uk.
The Enhanced Capital Allowance Scheme
The Enhanced Capital Allowance (ECA) scheme offers tax incentives to businesses that invest in energy saving equipment and enables them to claim 100% first year capital allowances on investments in approved energy saving equipment. Businesses are now able to write off the whole cost of their investment against their taxable profits for the period during which they make the investment. Qualifying equipment includes boilers, lighting, motors, drives, combined heat and power, thermal screens, insulation and refrigeration.
Further information on the ECA scheme and The Energy Technology Product List of supported products can be found on the ECA Scheme Web-site www.eca.gov.uk.
Energy Services
The term 'Energy Services', also known as Contract Energy Management, CEM, describes arrangements by which an organisation may contract out some, or all, of its energy management functions. These agreements allow an organisation to transfer some or all the responsibility for ensuring cost-effective procurement of fuel, security of supply, and the efficient use of energy. Depending on the type of contract, the Energy Service can include the finance and provision of energy plants, lighting, boilers or CHP, ongoing maintenance and operation and fuel purchase.
Further information on Energy Services companies can be found in the 'specialist groups' section of the Energy Systems Trade Association's web-site www.esta.org.uk. The Energy Saving Trust http://www.energysavingtrust.org.uk/ also provides relevant information.