Carbon Trust announces an increase on business loans for energy-saving projects

Interest-free loans of up to £500,000 are available through Envido for companies seeking to lower their carbon emissions.

Online PR News – 02-February-2010 – – Firms planning to invest in energy-efficient plant and machinery could be eligible for an interest-free loan of up to £500,000. The Carbon Trust has increased today the maximum value of the energy-saving loans it can make available to small and medium-sized businesses, in response to increased interest in high-value loans over the past three months.

The Interest-free loans, made available as part of the Carbon Trust's £100m ‘Big Business Refit’ campaign, are designed to ensure that repayments are covered through lower energy bills. Therefore, costs savings delivered after the loan is repaid go straight on the bottom line.

Any business that does not qualify for the Carbon Reduction Commitment (CRC) or EU carbon emissions trading scheme (ETS) is eligible to apply for the interest-free loans.

Around 800 interest-free loans had been awarded since the scheme was launched last year, and it remains on track to lend more than £100m over the next 18 months.

North East steel components manufacturer Astrum was awarded £400,000, and has used the money to replace its ageing air compressors as part of a project that is expected to cut energy costs by £80,000 a year.

Interest-free loans pay for themselves within years through energy savings

In words of Mike Hutchinson, Operations Director at Astrum, the interest-free loan will pay for itself within four years through energy savings, and allow them to accelerate their investment plans installing a system that will not only cut energy costs, but will also improve the efficiency of their business.

The interest-free loan also paid for low-pressure drop piping, variable speed compressors and a leak-detection programme, all of which will improve energy efficiency. Around 10% of all UK industrial electricity consumption is used for compressed-air generation. Between 20% and 50% of that electricity is wasted due to air leakage and incorrect pressure control.

Russell Lerman, co-Managing Director at Envido said, “the Astrum loan is a classic example of how Carbon Trust interest-free loans can help firms improve the energy efficiency of their business. Astrum saw the offer of interest-free funding as an opportunity to improve its systems and give itself a competitive edge.”