Small Talk: Green energy clash is casting a shadow over small firms
SMEs that sprung up to install solar panels because of the financial incentives will close
No one said coalition government would be easy, but the tensions between the Conservatives and their Liberal Democrat partners over green energy policy are mounting by the day.
Former energy secretary Chris Huhne has already accused the Tories of trying to sabotage the Coalition's green policy initiatives, and now his successor, Ed Davey, is making speeches attacking the way the Chancellor describes environmental legislation as a burden on business. The practical effect of this infighting has been inconsistency on policy. And while this has been damaging for businesses of all shapes and sizes, it is small and medium-sized enterprises (SMEs) that have really suffered.
It's not all bad news. Last week, Mr Davey unveiled the £35m Energy Entrepreneurs Fund, a new scheme aimed at SMEs with low-carbon products and technologies to develop.
The money will initially target projects focused on energy efficiency in buildings, with companies offered as much as £1m each to develop their ideas in the hope this will enable them to persuade private investors to invest too.
Similarly, Mr Davey's department appears to be working hard to ensure that SMEs feature among the suppliers that will begin delivering the Government's flagship Green Deal programme of energy efficiency improvements to households in October.
Yet there are regular disappointments. SMEs have been hit by the rising cost of energy, so the delay in introducing the Green Deal to businesses is a blow for many. And businesses active in the cleantech sector complain that private sector funding remains hard to come by.
Then there is the solar power feed-in tariff debacle. The Government's insistence on cutting back on this scheme, which saw it dragged through the courts as ministers sought to renege on previously made commitments, has seriously damaged SMEs in two ways. Many will now find taking advantage of the scheme does not stack up financially. And many of the SMEs that sprung up to install solar panels because of the financial incentives to do so will close.
It is also a question of tone. The small-scale scheme announced by Mr Davey last week is no match for the increasingly anti-green rhetoric coming from the Treasury and, to a lesser extent, the Department for Business.
The message from these departments has been that there is a choice to be made between greening energy policy and economic growth.
Utilitywise powers toward a listing
Aim flotations have been few and far between this year and most of the companies that have made it to a listing have been in the natural resources sector – often with assets in far-flung regions of the globe. However, Utilitywise, which will will unveil to float today, is a little different: it's based in South Shields, Tyne and Wear, is debt free and profitable.
The business, run by father and son Geoff and Adam Thompson, wants £10m from investors to fund expansion, which would value Utilitywise at around £50m. The Thompsons specialise in energy procurement and management for business customers with a 8,000 organisations already signed up. Profits last year were £3.5m on turnover of £11.7m.
Small Businessman of the Week: Matt Downes, Director and co-founder, Strategy To Revenue
We started in 2008. We saw an opportunity to drive a different approach to the way companies invested in their people.
In recent years, training and staff development have increasingly moved online, with webinars and e-learning, but we wanted to do something different – there is still a need for people to come together in a face-to-face environment, even if the organisation can't afford to take its sales teams off the road for a day or more to meet with a trainer.
We've developed 'power sessions', multi-media packages that a manager can run with his team – it is tailored to the company and we supply the materials to help him motivate, educate and mobilise the sales force. We turned over £850,000 in the first year, grew by 35 per cent in 2010 and doubled in 2011 – now the aim is to turn over £5m in 2012.
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