There are a number of various options to raise the capital to pay for the initial investment depending on your organisation and business type. Enhanced Capital Allowances (ECAs) and Carbon Trust 0% Interest loans are two of these schemes that provide generous finance assistance to businesses wanting to implement energy efficiency projects. Salix Energy Efficient Loans Scheme is also available and delivers 0% interest free capital to the public sector to improve their energy efficiency. Michael Scott can help you in choosing and understanding the right scheme for you.
Salix Finance works with UK public sector bodies. It is an independent, publicly funded company set up in 2004 to accelerate public sector investment in energy efficiency technologies through invest to save schemes. Salix has public funding from the Carbon Trust and is working across the UK public sector with Local Authorities, NHS Trusts, Higher and Further Education institutions and Central Government.
Salix Finance enable’s Public Sector bodies to improve their energy efficiency, attain targets, reduce energy bills and raise green credentials. Salix do this by using long term, ring fenced, interest free capital to make carbon saving projects happen within the public sector by offering interest free capital.
Salix provides interest free loans to help publicly funded bodies reduce their energy costs and carbon emissions. The loan amount is intended to fund the full cost of the work and is repayable between 4 to 8 years depending on the property and organisation. Salix services can be used for a range ofenergy saving projects such as:
Once the energy efficient technology has been installed the energy savings are returned to the fund as loan repayments until the original investment has is repaid. As soon as the loan is repaid, you are free to keep the savings top spend on front line services. In many cases the loan repayments are satisfied by the savings in your energy bills due to the energy efficient technologies there for not actually costing the end user anything. In some instances we have seen some customers actually profit from having the energy efficient technology installed from day of installation.
Michael Scott is well versed in securing Salix Finance for our customers; we will undertake an initial assessment to establish suitable energy saving projects and prepare application for funding. The Salix consultancy process includes calculating the payback periods for he chosen projects and managing any queries during the process. After successfully securing the loan, we are also able to manage the implementation and construction phase through to completion in a full turnkey package.
If you would like to know more about this scheme please check the Salix Finance website
http://salixfinance.co.uk/or contact us for further details
The Enhanced Capital Allowance (ECA)
“Claim 100% first year capital allowance on your LED lighting”
The Enhanced Capital Allowances (ECA) scheme is a key part of the Government’s programme to manage climate change. An ECA enables a business to claim 100% first-year capital allowances on their spending on qualifying plant and machinery, against taxable profits of the period of investment.
The scheme encourages businesses to invest in energy saving plant or machinery specified in the Energy Technology List (ETL) to help reduce carbon emissions, which contribute to climate change. The ETL is a register of products that may be eligible for 100% tax relief under the ECA scheme for energy saving technologies. The Carbon Trust manages the list and promotes the ECA scheme on behalf of government.
This link gives an overview of lighting equipment specified on the ETL and illustrates the reductions in energy bills that can be realised by investing in qualifying ETL energy saving equipment over non-qualifying equipment.
Certain energy efficient lighting products also fall within the energy category within the ELT.For lighting systems, the Enhanced Capital Allowance scheme eligibility is dependent on the systems performance and how it has been configured. Energy saving lighting solutions are different to some other energy saving technologies where specific products qualify.
At Michael Scott, amongst our wide range of energy saving lighting solutions we offer two types of lighting systems that are on the list if qualifying products for the Enhanced Capital Allowance. These two types are lighting controls and LED lighting.
The enhanced capital allowance scheme aims to encourage businesses to purchase lighting controls that implement energy savings by automatically switching or dimming lighting. Various categories of lighting control are eligible and detailed on the ETL; these can be either individual controls or combinations of the following:
A networked lighting controls system
Michael Scott can advise you of a lighting control system that is eligible under the ECA scheme’s criteria.
White light LED luminaire eligibility for enhanced capital allowance is mainly dependant on their light output efficiency. The eligibility differs depending on the application that is going to be installed. Once again Michael Scott will be able to advise you of which LED luminaires and systems are eligible under the ECA scheme.
How can my business benefit from ECA?
Under the ECA scheme working with Michael Scott, businesses and organisations are eligible to claim full corporation tax relief within the first year on their qualifying capital expenditure for an energy saving lighting installation The ECA scheme means that UK businesses can offset a significant part of the lighting product and installation cost against taxable profits in the year of purchase. This provides a cash flow boost and incentive to invest in energy saving lighting equipment. In addition, from a point of lighting installation your business will benefit from reduced carbon emissions, increasedefficiency and lower energy bills, as well as better quality of light when and where its needed.
To find out more about how Michael Scott Services can help your business reduce its carbon footprint, save money on your energy bills and reduce your corporation tax please contact us.
For more information on Enhanced Capital Allowances please visit the ECA website https://etl.decc.gov.uk/etl/site/about.html
The Carbon Trust 0% Loans
The Carbon Trust was set up by the UK Government to accelerate the transition to a low carbon economy. The Carbon Trust has interest free loans available to business for energy saving projects. The 0% loans are unsecured, interest free with no arrangement fees and can be repaid over a period of up to 4 years. The size of the loan offered and its repayment period is based on the project CO2 savings, which will be assessed by the Carbon Trust. UK based Small and Medium Business (SMEs) can borrow between £3,000 and £100,000.
Does your business qualify? The scheme is open to businesses who:
Have been trading for more than 12 months
Have suitable credit rating
Have less than 250 employees
Have an annual turnover lower than £42.5m or an asset value lower than £36.5m
Are not more than 25% owned by a parent non-SME company
How long does the process take?
A decision in principle on the 0% loan can be made within 24 hours, though there are several verification stages to go through before the loan can be granted. Immediately following the formal loan application, the whole process normally takes between 4-6 weeks. One of the process stages involves having the proposed energy saving technology installation verify by an independent energy saving assessor.
Carbon Trust Loan Benefits:
UK based Small and Medium Businesses (SMEs) can borrow between £3,000 and £100,000 interest free
As the scheme is designed for energy savings to cover the repayments, your new energy saving technology should pay for itself and you will then continue to make savings year on year
The loans are Government funded and unsecured
A straightforward and fats application process with no arrangement fees
You’ll receive a conditional offer within 24 hours of your application being processed
All applications can be tracked online
Loans can be repaid over a period of up to 4 years
Which type of Energy Saving Technology Qualify?
Typical examples of energy saving technology include one or more of the following:
Boilers and Heating Controls
Here at Michael Scott as well as the supply and installation of energy saving lighting, as part of our full turnkey solution we can assist you with applying for an interest free loan from the Carbon Trust
For more information please see the Carbon Trust website http://www.carbontrust.com/client-services/technology/implementation