3 blockers businesses face to growing their renewable generation assets
And how to overcome them
At the Asset Management Conference earlier this month, we asked attendees what is standing in the way of them growing their renewable generation portfolios.
In this article we discuss three potential blockers that they identified, and how businesses can overcome them to secure great return on investment for their generation assets.
1. There isn’t a consistent net zero approach from government
The government’s fluctuating path to net zero, and weakening of several key policies has undermined confidence and urgency for critical carbon saving investments for many businesses and consumers.
At Good Energy, we regularly engage with the government on issues core to the net zero transition. But like many of the businesses we speak with, we believe that the government can play more of a leading role in accelerating the transition, so we can build resilience and security within our energy system, whilst also exploiting the benefits for businesses and consumers of decentralised, flexible renewable energy.
From selling power back to the grid, to aggregating your assets to provide flexibility services, businesses have exciting opportunities by moving quickly to invest in key carbon saving areas. Embedding sustainability isn’t just an ethical decision, it’s a commercial one – and businesses should cash in on this.
If you’re not sure how to get started, have a look at some of our other articles:
- Getting to net zero – a how to guide for small businesses
- How to measure your carbon emissions
- How to support greener commuting
- What is the Science based Target initiative?
- Six steps to earning an income from your renewable generation asset
2. Government don’t provide funding support for commercial green projects
Another important blocker that was identified was the lack of government funding support for commercial green projects.
A recent article from FSB highlights the unequal support for sustainability projects across Britain – stating that less than 1% of small businesses have received support from government schemes. Ofgem outlines the support businesses may be entitled to here.
We want to see the government raise the ambition and offer more targeted support for small businesses who want to accelerate their own net zero journeys.
With support sometimes hard to find, businesses often need to look to third party lenders for the financial support required to purchase low-carbon assets.
What third party funding is available for green projects?
From multinational banks to pension providers, financial organisations are increasingly moving away from investments in activities that contribute to the climate crisis. Instead, they are looking to finance green projects.
Good Energy’s preferred funding supplier is Finpoint, an FCA-regulated intermediary that gives businesses greater transparency about the funding options available to them. Explore options from a range of lenders, all through one application. Good Energy customers can also benefit from 24/7 support and impartial financial advice.
Find out more about how to get funding for commercial green energy projects here.
3. There aren’t enough products available to give small generators a good return on investment
There currently aren’t enough products offering small generators a good return on investment for their generation assets. Commercial generators that are too small to qualify for a PPA contract have been left with uninspiring Smart Export Guarantee (SEG) rates, until now…
At Good Energy, we are committed to paying renewable generators of all sizes fairly for the power they generate. We’ve been developing products and offerings to help more businesses than ever get a great return on investment for their renewable generation assets.
For our FIT customers, we’ve proactively rolled out Smart Export – a method which pays generators with a smart meter for the energy they actually export to the grid rather than an estimated 50%. Our data shows that on average our customers are exporting 60% to the grid – so customers with larger portfolios could make substantially more money by switching to us.
And for commercial and portfolio generators, we are developing SmartGen Portfolio – an export tariff that will pay renewable generators market-leading rates for the power they export, with the back up of returning to FIT export rates if the market drops.
We will share more information about Smart Export Portfolio very soon. Why not sign up to our newsletter to be among the first to benefit from the scheme as soon as it launches.
