A report by the Federation of Small Businesses (FSB) calls for the government to expand the current loan scheme for small businesses and provide incentives for firms to make their buildings more environmentally friendly.
Under current targets the UK is expected to reduce its carbon emissions by 20% by 2020. The FSB says that while many small businesses understand the benefits of green investment, the upfront cost is a huge disincentive.
Small businesses can play a huge part in the UK's fight against climate change
Many small firms are not aware that they can access a zero per cent loan scheme for energy efficient equipment. The scheme allows firms to ‘pay as you save' so firms can realise a genuine cost saving through energy efficiency, without having to make an upfront cost.
"In order to achieve the tough targets set by the government, it must ensure that it makes economic sense for the UK's 4.8 million small firms to go green," said John Walker, national chairman of the FSB.
"Small businesses can play a huge part in the UK's fight against climate change and we urge the government to harness this potential when it publishes its Energy Bill, expected later this parliament."