Electricity pylon and cables in the night sky

Irish SMEs failing to grasp energy bill calculations

AIB to lend €100 million to help boost energy efficiency

New research suggests that an alarming number of Irish businesses are clueless when it comes to deciphering their energy bills.

The report, sponsored by AIB and carried out by Amarach Research, indicated that 86% of the businesses questioned recognised that there was a need to try and reduce energy costs generally.

However, there seems to be little knowledge amongst the Irish business community regarding exactly how to do this.

To combat this, AIB have announced they will lend €100 million to enable Irish SMEs to become more energy efficient and to reduce energy bills in the long-term.

The survey showed that manufacturing SMEs spend an average of €114,000 on energy bills, while retailers spend €50,000 and other business spend €70,000.

Furthermore, 54% of businesses said they expected their energy costs to grow but few had an idea of how they would respond.

The issue is further complicated by the fact that more than half of the businesses questioned are in buildings which are between ten and 50 years old and are not very energy efficient.

Bernard Byrne, AIB’s director of personal, business and corporate banking, looked at the wider picture when assessing what an increasingly energy-conscious business community could potentially mean for national targets.

“It is also clear that the economic downturn has prompted businesses to focus on energy savings as a way of cutting costs when revenue growth is slow,” said Mr. Byrne.

“On the broader canvas, that in turn should help Ireland achieve its 2020 targets of reducing energy consumption by 20 per cent by 2020.”

Energy bills accounted for around 9% of operating costs in many of the 451 SMEs surveyed for the research.

The costs of installing energy efficiency projects varies depending on the size of the companies involved, but one in seven questioned expects to look for finance for such projects in the next 12 months.