Why going green could prove lucrative for Scottish business

The Swanny Brewery
The Swanny Brewery
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Promoted by Zero Waste Scotland

Resource Efficient Scotland can advise SMEs on how they can boost their bottom lines by making energy and refuse reduction a top priority, writes Rosemary Gallagher

Businesses know that they can cut their bills and other outgoings, and therefore boost profitability, by using less energy and water and fewer materials. However, actually achieving such savings can seem like a major challenge.

Energy bills are one of the top three outgoings for smaller'businesses

Energy bills are one of the top three outgoings for smaller'businesses

With such overheads only likely to increase, all firms, including Scotland’s large number of family businesses, are being advised to take steps now to cut usage, rather than think it is something they can put off until sometime in the future.

Using less energy, and being more resource efficient, is more than a good thing to do for small and medium-sized enterprises (SMEs), it should be seen as vital to their survival and growth. Building a more energy-efficient economy also offers opportunity for growth.

Since 2015, Scottish Ministers have designated energy efficiency as a national infrastructure priority, recognising the many benefits delivered by improving the energy performance of buildings.

The Scottish Government’s Energy Efficient Scotland route map sets out the vision that by 2040 Scottish homes and buildings will be warmer, greener and more efficient.

Resource Efficient Scotland supports business owners to run greener and more efficient businesses by identifying where they can make efficiencies, and supporting with expertise and investment.

Every £100 million spent on energy efficiency improvements in 2018 was estimated to support approximately 1,200 full-time equivalent jobs across the Scottish economy.

Energy bills are one of the top three outgoings for smaller businesses – along with people and property. It has been estimated that the SME sector in the UK spends more than £15 billion a year on energy alone. Therefore, any small business looking to grow must be smart when it comes to energy use and expenditure.

Zero Waste Scotland’s Resource Efficient Scotland programme is all about reducing energy, water and material use. It is designed as a one-stop shop for resource efficiency and was set-up by the non-governmental agency to help the country’s small businesses save money, and thereby improve their bottom line.

Launched six years ago, the programme is funded by the Scottish Government and the European Regional Development Fund through the £73m Resource Efficiency Circular Economy Accelerator Programme. It offers a range of services and access to finance for Scotland’s SMEs, including free assessments, where they identify energy, water and material efficiency opportunities in businesses.

To date, more than 3,000 businesses have received one-to-one in-depth support through the Resource Efficient Scotland Advice and Support Service, identifying a potential £54m in annual cost savings. The service can typically help businesses identify savings of 24 per cent on energy bills and nine out of ten surveyed clients have said that they would recommend its services to other organisations.

Businesses accessing the programme are given guidance throughout the process to help them reduce wastage and cut bills. Clients are allocated a dedicated implementation advisor who undertakes a free opportunities assessment, advising the organisation on priority measures to reduce costs and assisting with accessing funding.

Resource Efficient Scotland offers Scottish Government-funded SME loans of between £1,000 and £100,000 which are interest-free, unsecured and have an eight-year payback period for eligible businesses to pay for resource efficiency upgrades. Businesses can currently secure 15 per cent cashback up to £10,000 on energy-efficiency projects. To date, Scottish organisations have received loans exceeding a value of £26m for more than 968 projects, with cumulative identified savings worth in excess of £49m. Two of the recipients are profiled below.

Dedicated advisors are available to help plan projects, guide businesses through the loan application process and, if needs be, support implementation of the projects, from planning projects through to implementation.

Brexit poses an immediate energy cost threat to businesses as the UK untangles from a number of energy agreements signed with its former trading block. If Britain leaves the European Single Market and the EU’s Internal Energy Market then “frictionless” trade could be put at risk, due to uncertainty around the cross-border trade of electricity and which carbon-pricing mechanism would be used.

Carbon pricing is designed to reduce greenhouse gas emissions by increasing the cost for any business emitting them. Signing up to fixed-term deals is advised for companies to limit the impact of energy price fluctuations.

Cutting energy, water, waste and resource costs might not be a top business priority, but by working with Resource Efficient Scotland, SMEs can unlock immediate savings. And the advice is that these companies should be looking to invest in order to make these savings today to future-proof their business.

The programme also helps businesses tackle the challenges Scotland faces in reducing food waste – the nation throws out almost 1.4 million tonnes of food and drink every year.

From a business point of view, wasting food is expensive. Meanwhile, from an environmental point of view, it generates methane, a potent greenhouse gas, and squanders the water, land and energy resources that go into producing that food in the first place.

Practical and financial support is available to help the country achieve Holyrood’s commitment to reducing the food waste mountain by 33 per cent by 2025.

Contact Resource Efficient Scotland for free advice and support by telephoning 0808 808 2268, or e-mailing enquiries@resourceefficientscotland.com. See also the website at

www.resourceefficientscotland.com

Savings made on frozen assets

Donald’s Cream Ices, a Gourock-based family run frozen food wholesaler, used an SME Loan from Resource Efficient Scotland to install a new, high-performance freezer room.

The company’s old freezer offered limited room for growth and was vulnerable to malfunction. Overloading the unit also restricted the air flow into the freezer room, reducing efficiency and increasing the firm’s energy bills.

Resource Efficient Scotland recommended installing a modern, energy-efficient facility as the most reliable and economical option.

To this end, Donald’s was supported in applying for an unsecured, interest-free loan.

This process included providing due diligence guidance and support with procurement.

The business has since received the loan and successfully completed the installation of its new freezer room.

It is estimated that it is saving the business £4,500 per annum.

Carlo Amadei, owner of Donald’s Cream Ices, says: “I have nothing but good things to say about Resource Efficient Scotland and the SME Loan.”

Casking for more

Swannay Brewery, based in Birsay on Mainland Orkney, produces more than 300,000 litres of beer each year.

Lewis Hill, Swannay’s manager, first heard about Resource Efficient Scotland’s free advice and support service when he attended a Zero Waste Scotland circular economy workshop on the island.

The Swannay team decided to request a food waste audit – which Resource Efficient experts conducted free of charge.

Opportunities were identified for reducing waste in the brewer’s cask-filling process which could bring potential annual savings of £9,845 and reduce carbon emissions by 21 tonnes.

It emerged that a significant proportion of beer was being lost in the manual casking process, so a Resource Efficient Scotland representative recommended Swannay install a cask racker, with the financial help of Zero Waste Scotland’s Waste Prevention Implementation Fund.

A waste-saving opportunity was also identified for Swannay – the idea of using leftover beer from casks returned to the brewery as an nutritional addition to feed for local livestock.

Hill concludes: “Receiving on-site support from Resource Efficient Scotland has been incredibly beneficial.”