The Business Benefits of Switching to Sustainable Energy

Switching to sustainable energy doesn't end with the good it does for the planet. Increasingly, business owners are coming to understand the importance of doing so. Legislative changes will almost certainly come which further restrict the use of fossil fuels, and it’s always beneficial to be ahead of the curve on a matter like that. But this isn’t all about doing what you have to do or even the benefits for the planet. It also makes commercial sense to switch to sustainable energy.

The Benefits of Sustainable Energy for Businesses

Your bottom line

Switching to sustainable energy is an investment that can deliver significant financial benefits. For years, the ‘green premium’ made renewable tariffs more expensive. Today, that has reversed. The cost to build and run new wind and solar projects is now significantly lower than for new gas-fired power stations, making green energy the smart financial choice, not just the ethical one. Whilst wholesale energy prices fluctuate for all generation types, long-term contracts for renewables can offer greater price stability for businesses compared to the volatile global markets for fossil fuels.

Future-proofing

There is little doubt that further restrictions on the use of fossil fuels are coming, and by being ahead of the curve you can ensure that your business is ready for these changes. Such is the importance of making these changes to the way we live and work that governments and other organisations are offering significant incentives, which may help to make these changes highly cost-effective for your business.

Current government support for businesses includes:

• Full expensing: A 100% first-year capital allowance for investing in qualifying new plant and machinery.

• Boiler Upgrade Scheme (BUS): Grants of up to £7,500 towards the cost of installing a heat pump.

• Workplace Charging Scheme (WCS): A voucher-based scheme that provides support towards the up-front costs of the purchase and installation of electric vehicle charge points.

• VAT relief: A zero rate of VAT applies to the installation of certain energy-saving materials. This is in place until 31 March 2027.

The good of the planet

Climate change is already having very real and serious consequences for our planet, but it’s not too late to arrest and even reverse the worst of its potential impacts. Reducing your business carbon footprint is the biggest contribution that you can make toward achieving this aim.

Your business reputation

It’s also the case that there is a growing level of expectation on the part of customers that your business will be proactive on this front. You can attract new business by promoting your green credentials, growing your company’s public reputation and earning a significant uptick in terms of your public image.

Sustainable Energy Solutions for Business

Solar

Sunlight is one of earth’s most readily available sources of energy. The amount of solar energy required to keep us going is minuscule; what reaches the earth’s surface in a single hour is more than the whole planet’s total energy requirements for an entire year.

But this does come with a not-insignificant caveat, which is that this energy is not received consistently. The amount of solar energy available fluctuates according to both the time of day and year, while geographical location is also important. Solar can be difficult to store, though battery technology is rapidly developing.

Wind

Wind is as freely available as sunlight, with turbines powered by the wind driving generators which help to supply the National Grid. Wind farms have become an increasingly common sight in recent years, and some premises can be suitable for domestic turbines, which is colloquially known as going “off-grid”.

Hydroelectric

The power of water can be harnessed using turbines powered by the controlled flow of water from reservoirs. The dams required to be able to control that flow make these a huge infrastructural investment on the part of governments, but the benefits have been such that it has increasingly become a part of the energy landscape regardless. Hydroelectricity carries the significant benefit of being easier to store than solar or wind, which can help offset peak usage times.

Bioenergy

The new kid on the block when it comes to renewable energy, bioenergy refers to electricity and gas that is generated from organic matter. This matter is also known as ‘biomass’. It comes from several different sources, from plants and timber to agricultural or food waste. Even sewage can be used. Like water, it’s an energy source which is quickly upscalable for periods of high demand, and converting solid fuel made from plant materials into electricity also comes at a lower cost.

Green Energy Tariffs and Providers

Green energy tariffs are labelled as such if some or all of the units of electricity are ‘matched’ by units generated from a verified renewable energy source, such as a wind farm, solar array or hydroelectric power station. As the market has grown, so has the array of different tariffs available to businesses. But not all green energy tariffs are created equal, and ‘some’ in ‘some or all of the units’ can have to do some heavy lifting at times. Three companies lead the way, both in terms of providing commitment to and support for the industry as a whole.

Good Energy

Good Energy was founded in 1999 and is a highly respected business in the green energy sector. It is consistently recognised for its commitment to sustainability, including being named a Which? Eco Provider for six consecutive years.

Ecotricity

Ecotricity is probably the highest profile of the three companies mentioned here, thanks in no small part to the public profile enjoyed by founder Dale Vince, who also owns Forest Green Rovers, the world’s first vegan football club. The majority of Ecotricity’s output comes from its portfolio of wind power generators, and they currently supply around 170,000 homes and businesses in the UK.

100Green

100Green, which was founded as Green Energy UK (GEUK) in 2001, is the UK’s only energy supplier to provide 100% green gas to both homes and businesses. They were the first to offer this service and remain unique in the market.

What to Look Out for When Switching to Renewable Business Energy

It’s important to do your research when switching to a renewable business energy tariff, because not all ‘green’ tariffs are created equal. Some suppliers buy cheap Renewable Energy Guarantees of Origin (REGO) certificates to label their electricity as green without directly investing in renewable generation. To ensure your switch has a real impact, look for suppliers who generate their own renewable power or have direct purchasing agreements with renewable generators.

Cost

Depending on which way you opt to go, there can be significant set-up fees. Installing solar panels, for example, costs several thousand pounds. But once they’re in place, the long-term return on investment can be huge. Through the Smart Export Guarantee (SEG) scheme, you can be paid for any surplus renewable electricity you generate and export back to the National Grid, helping to offset your own energy costs.

Practicality

It’s important to understand the practical limitations of what you can and can’t do, with regard to green energy. If you rent office space in a tower building, for example, it’s unlikely that you’re going to be able to install solar panels, though you may still be able to switch to green tariffs which carry advantages for your business. The better you understand what you feasibly can and can’t do, the easier your decision-making process will become.

Understand your needs

The shortest cut to changing these habits is to understand your company’s needs and what you are hoping to take from all of this. Do you have the space for the equipment required to go off-grid? If you’re looking to change suppliers to increase your business energy efficiency, what’s your business tolerance for the higher costs of a higher proportion of your energy use being renewable? What do your key stakeholders expect from all of this? Have a plan before you start.

The phrase ‘Renewable energy’ means different things to different people, and it can certainly feel like having to hack through a forest to get to the answers that you want when you’re considering making changes toward a greener future. Fortunately, though, there is a shortcut to make it less daunting. SwitchPal can compare trusted energy suppliers across the entire industry and offer you a range of options, simplifying the entire process for you. With financial benefits to be reaped and future-proofing to be done, making that switch is a decision that you can’t afford not to make.