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One of the biggest ways your business can help the planet is by making the switch to renewable business energy.
What that means in reality, however, can vary greatly. Do you just want to ensure your energy supply comes from renewable sources? Or do you also want to generate your own renewable energy?
Renewable energy is generated through sources that are not permanently depleted by their use. For example, solar energy does not reduce the amount of sun in the world; ditto wind turbines and wind.
Other forms of energy labelled ‘renewable’ therefore are better described as sustainable. This means sources of energy that can be created again in the future, such as nuclear or biogas, but are not self-renewing.
Although not suitable for every business, the in-house generation of renewable energy can not only provide a step towards tackling the climate crisis, but give you greater autonomy when it comes to your energy bills.
And that’s something that must be mighty appealing at a time when a third (33%) of business leaders and decision makers labelled energy prices a ‘major’ challenge, according to a NerdWallet UK survey in March 2022.
Renewable business energy: what to consider
For both energy suppliers, and businesses themselves, there are a range of different ways renewable business energy can be generated.
Solar PV panels
One of the most familiar forms of renewable energy, solar photovoltaic (PV) panels use their cells to convert sunlight into electricity. According to industry association SolarPower Europe, solar PV energy is 96% less carbon intensive than coal, and 93% less than gas.
If you plan to install these on your business premise, you need to make sure you have the space on your roof or on the side of your building. And ideally, this space would be south-facing, in order to maximise exposure to the sun.
While there is an undoubted seasonality to solar panels – fewer hours of daylight and the sun’s lower position in the sky mean energy generation falls in winter – they still work in all weathers. But you will need to be conscious of the fact that you won’t be able to rely on solar panels in winter for all of your energy needs.
» MORE: Are commercial solar panels worth it?
Solar thermal energy
Solar thermal energy differs from solar PV energy as, instead of generating electricity, it uses the sun to heat up water.
It is possible to have a solar thermal system installed on the roof or on the side of your business premises. This can potentially help you save money on your heating bills.
Due to the use of heat instead of light, seasonality is a greater issue for solar thermal energy. Profit-for-purpose organisation Energy Saving Trust estimates that while solar thermal energy can cover around 90% of your hot water usage in the summer months, that drops to 25% in winter.
Wind power
Whether an offshore farm or a roof-mounted turbine, wind power is one of the UK’s major contributors to renewable energy.
National Grid statistics show that wind power provided 26.1% of all electricity generated in the final quarter of 2021, with a 12% and 14% split between onshore and offshore respectively.
Depending on your premises and location, you can look into a roof-mounted or freestanding wind turbine to generate electricity for your business.
Wind, however, while inexhaustible, isn’t constant. The Met Office reported in July 2022 that the UK’s annual wind speed for 2021 was the second lowest since records began in 1969. And that’s not a one-off – the period between 1969 and 2021 has shown a downward trend ‘consistent with that observed globally.’
This global slowdown has contributed to the energy crisis, with falling wind speeds, and therefore lower energy generation, playing a part in sending prices higher.
Hydroelectric power
While most associated with major dams, hydroelectric power – that is, the generation of electricity through the movement of water – is possible for businesses, and even domestic households.
Micro hydro power systems can potentially be installed if your business premises are located near a river or stream. The suitability of the system will in part depend on the flow of water, and the ‘head’, i.e. the height difference between where the water enters and leaves the hydro power system.
But hydropower is also increasingly a victim of our changing climate. Norway is one of Europe’s biggest electricity exporters, and generates 90% of its total power production through hydro. Yet the intense summer droughts in 2022 led Norway to consider imposing export curbs due to falling water levels.
Biogas
While natural gas is not a renewable source, it is possible to produce biogas, which is.
Anaerobic digestion (AD) is the process where organic material, such as plant or animal waste, is broken down to produce a biogas. This biogas can then be burned in generators to produce electricity, compressed to become vehicle fuel, or cleaned up and turned into biomethane in order to replace natural gas that can then be used, for example, for cooking and heating.
This means an anaerobic digestion facility could, for example, be installed on a farm, where there is an abundance of the materials required for generation.
Other types of renewable business energy
There are more types of renewable energy than the headline quartet of solar, hydro, wind and biogas. These include:
Biomass systems
A biomass system burns biological material – such as wood pellets or straw – in order to produce heat for use in heating systems. It can also be used to generate electricity through direct combustion and to produce a renewable alternative to natural gas.
An example of a business use for this type of energy would be the installation of a commercial biomass boiler at your premises.
Geothermal and ground source heat pumps
The Earth stores heat of its own. Geothermal and ground source heat pumps access this low-level heat via temperature-conducting fluids, and transfer it to your business premises through pipes in order to provide heat or hot water.
These pumps can even be used as a way to cool down your building in the summer, by removing heat from the air and transferring it to the ground.
Combined heat and power (CHP)
A combined heat and power system does what it says on the tin – it generates electricity, while utilising the heat produced by the same electricity generation. The electricity is generated through a gas engine, which can use renewable sources such as biogas.
For small businesses and households, a micro-CHP system would be most appropriate. It can replace a traditional boiler in terms of heating water, while also co-generating electricity.
Renewable energy vs fossil fuels
In one sense, fossil fuels have history on their side. Due to pre-existing infrastructures, and the political power of the sector, coal, oil and natural gas can be seen as a cheaper and easier path to energy generation than renewables.
The Financial Times recently reported that even coal was in danger of being ‘re-embedded’ into Europe’s electricity generation, due to the current supply issues surrounding gas.
Similarly, Prime Minister Liz Truss reversed the ban on fracking in September 2022 in order to combat the country’s energy crisis. Fracking is also a fossil fuel, producing gas and oil from shale rock.
But whatever the flaws are with renewable energy, they pale in comparison to the risks of sticking with fossil fuels, and the catastrophes that path will continue to cause. And not only are they unsustainable for reasons related to the climate, they are a finite resource on top.
How do I get renewable business energy?
There are two main, overlapping paths you can take when getting renewable business energy: generating your own electricity, and ensuring your supplier is 100% renewable.
Generating your own electricity
If you are a business looking to install your own forms of energy generation, then not every type of renewable business energy will be the right fit.
When weighing up your energy options, you would need to take in consideration:
- the size of your energy needs
- the cost of each type of renewable energy, and how long it would take for you to recoup the initial investment
- your business premises, and which types of installation can be accommodated
- planning permission, regulatory and legal requirements
You should also pay attention to which forms of renewable business energy you can sell back once generated (assuming you don’t use it all). If you are based in Great Britain, the Smart Export Guarantee (SEG) allows you to sell the following types of energy to the National Grid:
- solar PV power
- wind power
- hydro power
- biogas
- micro combined heat and power
In Northern Ireland, the energy market is regulated by the Northern Ireland Authority for Utility Regulation (NIAUR) and electricity is not supplied through the National Grid. For information on renewable energy for businesses in Northern Ireland, you can find out more here.
Switching to a renewable business energy supplier
It is easy to switch your business energy supplier to one using 100% renewable energy when you move into new premises or your existing contract expires. Many companies will openly promote that they are renewable only, while others will offer a specific renewable tariff.
If you want to find out exactly how this renewable business energy is being generated, then you can look into a supplier’s fuel mix disclosure.
Suppliers in Great Britain are legally required to inform customers how their electricity is generated each year, based on the Electricity (Fuel Mix Disclosure) Regulations 2005. You should be able to find this information on the website of each supplier.
Suppliers in Northern Ireland are similarly required to inform customers on their fuel mix disclosure, under Article 14 of the Gas and Electricity (Internal Markets) Regulations (Northern Ireland) 2011.
You can use our comparison tool to see how the country’s renewable business energy suppliers stack up against each other, in order to find the one best suited to your needs.
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