Measure

Financing sustainability through external sources

Financing sustainability through external sources
© Romolo Tavani, image #100673786, 2017, source: Fotolia.com
Resources:
Energy, Materials, Water, Waste, Carbon
Sector:
All sectors
Cost:
High cost
Payback time:
3 - 25 Year(s)
Payback time:
Sustainability measures requiring external funding are often long-term projects with largely varying ROIs from 3 to 25 years, depending on the measure
Total cost savings:
Resource and cost savings depend on the sustainability measure being financed
Premises and operation areas:
Production building, Product and design, Production processes, Supply operations, Waste and recycling
Size of company:
Micro (less than 10), Small (less than 50), Medium (less than 250)
Advancement in applying resource efficiency measures:
Beginner, Intermediate, Advanced
What is in it for you:
Increased financial security and, if given the technological support, reduced risk of a failed sustainability project due to financial constraints or unexpected problems, especially during early stages of implementation.
Descriptive information:

Initial investment costs can discourage SMEs from choosing to pursue sustainability as a business strategy; the vague long-term benefits and payback on the investment might not seem worth it. And the green sector is vulnerable to changes in government policy, which could adversely affect ongoing sustainability efforts, leading to uncertainty.

Financing a business’s environmental project through external sources can provide the required fiscal security for a successful transition to sustainable practices. Businesses not only get funding in terms of financial aid, but also the technical knowledge and support to help implement future sustainability measures. Many financing schemes also provide evaluations of possible improvements.

In the field of sustainability, governmental institutes, companies and NGOs provide assistance through programmes, funds, grants, loans, and support schemes. Other funding possibilities are provided by the European Union and inter-governmental organisations.

Within the EU's Horizon 2020 programme, for example, SMEs can get up to € 2.5 million each in funding. On the national level, the German government has been providing support for innovative SMEs; ZIM offers a range of funding opportunities and cooperation. The Plug-In Car Grant in the UK is another example, granting businesses up to 25 % of the costs for ultra-low emission vehicles, up to around € 5 635 (£ 5 000). The Dutch government has similar incentives, which results in savings of up to € 19 000 for corporate owners over five years. 

Many suppliers of sustainable technologies have partnerships with financing bodies and can then recommend flexible funding options for SMEs to start their transition to sustainable operations.

Testimonial:

"Many businesses are hesitant to invest in energy efficiency because they feel deterred by the large upfront capital required. Without the help of the EEF scheme, we would not have been able to prioritise these green investments. That would have meant a continuation of significant heating bills, and hefty carbon footprint. The EEF scheme, as an alternative financing option, has allowed us to do just that: saving money and the environment simultaneously." - Rodger Jackman, ‎Strategic Development Manager, ‎Dame Hannah Rogers Trust, on the EEF scheme

 

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