BUSINESS Secretary Vince Cable is encouraging firms to seize the chance of government match-funding to increase their energy efficiency and better compete with US rivals benefiting from America’s shale gas revolution.
Cable attended the launch of a forum for green technology firms in Edinburgh last week, where it emerged that the private sector is missing out on huge energy savings because companies are too risk-averse to invest in technology.
But the UK Cabinet minister told Scotland on Sunday that help is at hand, as match-funding initiatives from the likes of the Green Investment Bank aim to de-risk projects and pave the way to a rise in efficiency for firms.
“There’s been a rise in uncertainty and our job is to try to reduce that,” he said. “We are de-risking environmental projects so that private investors who are on the brink of making a decision will take the risk because there’s government money alongside.”
Both the UK and Scottish governments are trying to persuade households and businesses to reduce their energy consumption to help meet ambitious carbon reduction targets. The plans were hatched in a last-ditch attempt to avoid serious climate change and the disruption that could bring. However, since energy costs in Europe have soared in recent years, greater efficiency has also become an issue of competitiveness.
Cable noted that firms are increasingly concerned about finding ways to match rivals in areas of the world where energy is often cheaper.
He said: “At the moment there’s a lot of cost pressure, and I’m hearing that a lot more from businesses competing with the US, where they have the benefit of very cheap gas.”
He said the Green Investment Bank was already supporting a fund investing in industrial energy efficiency. The bank revealed last week that it has invested £635 million since it opened in October, securing 11 deals worth a total of £2.3 billion once private funding flooded in.
The Business Secretary was at the offices of law firm Anderson Strathern, where he was attending the launch of a forum for Scottish businesses involved with the low carbon economy.
During a debate to launch the EcoConnect group, delegates spoke of the difficulties in persuading both consumers and businesses to adopt policies that could save them money.
Stewart Little, chief executive of Dundee-based IRT Surveys, said it was hard enough trying to persuade households to take his energy-saving advice, even when it was free. He resorted to showing people what they could buy with the money they save, such as expressing it in terms of cans of Tennent’s, to get them to act on the thermal images of buildings he uses to show people where their heat is leaking out.
He said the commercial sector was proving even tougher to crack, because firms were not interested in investing when the return on their investment takes longer than three years.
As a consequence, firms such as IRT have tended to take the easier option and have targeted their services at the public sector, which is keen to be seen to be investing in efficiency, he said.