Renewable Energy for Business

Investing in renewable energy for your business can help you reduce your expenditure and become environmentally friendly. Renewable energy sources are available for both your business electricity and gas supply.

Both climate change and sustainability continue to remain key topics across the world, more so in recent years. The UK has a target to reduce its carbon emissions and become net zero by 2050. To achieve this, businesses throughout the world are slowly moving forward to becoming more environmentally friendly. Those that are interested should definitely look into carrying out a business energy audit as a way to improve energy efficiency through reduced consumption.

Today we hope to give you a better understanding on renewable energy for businesses. We will also cover the various renewable sources that you can make use of to cut the amount your company pays for business energy prices.

Things to consider before installing a renewable energy source for your business

Investing in renewable energy sources for your business will certainly benefit you in the years to come. Although, you must first consider a few things before making the green move and getting underway with any installations. These considerations include:

Planning permission: Once you have decided on the most optimal renewable energy source for your business, you will need to obtain planning permission from your local authority. Think about your business’ requirements, your premises and location. It’s also important to make yourself aware of any restrictions within the planning stage.

Connection requirements: Changes may need to be implemented to your building when you are installing a new renewable energy source. Think about the connection requirements and whether they are suitable for your business, as well as the planned costs for the project.

Business renewable energy site survey: The National Energy Foundation can be consulted to help you carry out a renewable energy site survey. This includes a thorough business analysis as well as a recommendation for the most suitable option to meet your needs.

Regulations and legal obligations: When selecting an installation company, choose one that has been approved under the government’s Microgeneration Certificate Scheme (MCS). After all, you want to use an authorised professional provider and make sure that your investment into renewable energy equipment is protected. Learn more about microgeneration for business here.

What renewable energy options are available for businesses?

As a member of The Paris Agreement, the UK has made a consequential investment into renewable energy sources. The agreement seeks to reduce greenhouse gas emissions across the globe and was a strategy founded at the United Nations Framework Convention of Climate Change (UNFCCC). The country’s progress has made it one of the world’s top ten most attractive national markets for renewable energy. Since 2019, 33% of the UK’s energy output was derived from renewable sources.

At this juncture it is important to clarify what renewable energy actually is. Renewable energy is energy that is generated from a source that does not deplete over time and can be replenished, unlike fossil fuels such as coal and oil which are finite in their availability.

What renewable energy sources are available for businesses?

There are a number of renewable energy options available on the market for businesses. The best option for your company will depend on where you are located and how much you are able to invest. A business energy audit will help you ascertain what type of green energy option is right for you.

Solar PV panels

Solar panels are the most popular form of renewable energy for businesses. These PV panels can be installed on the roof of your premises, some can even be attached to the side of your building. You can expect smaller solar panel installations to cost between £5,000 to £12,000. On average, these will take between six and ten years to recover your costs from the energy generated.

Wind power

If you have acres of free land, using wind power to generate energy could be a viable option for your business. To generate a substantial amount of power, you will need to install a large system.

A microturbine (2.5kW to 6kW) will cost you around £10,000, whereas a larger turbine is considerably more expensive at £3.3 million. You can expect a small turbine (20kW to 50kW) to take around 15 years to recover your initial investment, while a larger turbine generating 1MW to 2.5MW can take between one and five years.

Hydroelectric power

Hydroelectric power can be used to generate electricity by passing water through a submerged turbine or waterwheel. You can expect the price of these systems to be around £4,000 to £9,000 per kW. By installing a capacity for 8kW, it will take you around seven years to recover your initial investment with a hydroelectric power plant.

Solar thermal energy

A solar thermal energy installation makes use of sunlight to heat up your water tank. This type of installation is relatively straightforward and can be placed on the side of your building. As for expenses, you can expect it to be between £3,000 and £5,000. It will take around five years to recover your initial investment.

Combined heat and power systems

These systems capture and store heat created by your electricity. It will then be used to heat your water. It will set you back around £35,000 and take ten and a half years to recover the initial costs.

Biomass systems

These systems generate power by burning organic materials such as straw or wood pellets. The cost will largely depend on the type of fuel and size of boiler your business opts for. Expect the cost recovery time to be between five and twelve years.

Geothermal and ground source heat pumps

These can be fitted on the side of your building. The system makes use of low levels of naturally occurring heat from the ground to generate both cooling and heating. It will cost you around £10,000 to £15,000 and take approximately 15 years to recover the initial investment outlay.

The future of renewable energy for businesses

Over the next five years, the use of renewable energy is expected to increase by more than 50%. As research and development in this sector continues, manufacturing costs will naturally be driven down and make it far easier for businesses to invest in these sustainable energy generation sources. Furthermore, as the market continues to become more competitive, energy procurement becomes less expensive which will make both domestic and business energy tariffs cheaper for customers.

Innovation within the sector will also mean that the range of available energy sources will also likely increase. Here are some possible sustainable energy sources that are currently being explored and may be viable one day in the future:

  • Artificial photosynthesis
  • Enhanced geothermal
  • Solar power from space
  • Wave generation

Advantages and disadvantages of sustainable energy for business

Before you take out the cheque book and invest in a commercial renewable energy source, it is important to understand the advantages and disadvantages to help you make an informed decision.


  • Energy costs become cheaper and more stable over time
  • Reduce carbon emissions and become carbon neutral
  • Improve your company reputation through corporate responsibility
  • Moving towards becoming sustainable as renewable energy sources can be replenished
  • Another income stream through Feed in Tariffs and the Smart Export Guarantee
  • Business exemption from the Climate Change Levy (CCL)
  • Energy subsidies through a government energy efficiency grant
  • Over time, renewable sources will eventually pay for themselves


  • High initial costs – Installations may be expensive to begin with. Although, the savings you will make in the years to come will offset these expenses.
  • Intermittency – Not all renewable sources are readily available at every hour of the day. For example, sunlight won’t be available after sunset. However, did you know that solar panels can actually generate electricity without sunlight?
  • Space and geographical restrictions – Business suitability must be factored in for various types of renewable energy sources. As an example, wind turbines are best suited to locations which have access to a large open space as opposed to an industrial location surrounded by buildings.
  • Energy storage costs – Storing generated energy through battery systems can become expensive. Fortunately, energy storage capacities are increasing with technological innovations and advancements within the field. This will make storing energy far more affordable in the years to come.

It is clear that the benefits of renewable energy generation outweigh the potential drawbacks. Business owners are also advised to compare green energy tariffs to become more environmentally sustainable.