Coping with the Crisis:
Increasing Resilience in Small
Businesses in Europe through
Energy Efficiency
Proposed Energy Saving Strategies
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Coping with the Crisis: Increasing Resilience in Small Businesses in Europe through Energy Efficiency
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Introduction
Today’s global energy crisis has driven up the cost of fuels and electricity, creating
shortages and hurting consumers, businesses and entire economies. Small to
medium enterprises (SMEs) are some of the most exposed economic players,
lacking the margins, economies of scale, and support staff that allow larger
companies to mitigate the impact of the crisis. At the same time, SMEs are the
backbone of economies around the world, making their survival essential.
To help smaller businesses overcome these perilous challenges and to sustain
European economies, the European Commission and the International Energy
Agency have teamed up to raise the awareness of governments, businesses and
related stakeholders about the available options to empower and protect SMEs.
These include EU support measures currently available to SMEs that can be
tailored to meet their specific needs. They also include steps that businesses can
take themselves to use energy more efficiently and wisely, making them more
resilient and secure – both in the short and in the long term.
In this document, the sections on setting the scene, what the European Union can
do, and what national governments can do were prepared by the European
Commission. The section on what small businesses can do was prepared by the
International Energy Agency.
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Setting the scene
Small and medium-sized enterprises (SMEs) are the backbone of Europe's
economy and add value in every sector. They represent 99% of all businesses in
the EU, employ over 80 million people and account for more than half of Europe’s
gross domestic product. With many small businesses already reeling from the
impact of the coronavirus pandemic, the current high energy prices and supply
uncertainty are creating further pressure on their survival.
How the EU supports SMEs
Since the start of the energy crisis, the European Commission has come forward
with several initiatives that aim at supporting not only households but also small
businesses. Already in October 2021, the Commission published a toolbox of
measures that EU countries can use to help businesses, such as income support,
energy vouchers, rebates on bills or financial support for energy efficiency and
renewable energy measures. More recently, an emergency tool was agreed
stipulating that EU countries may temporarily set a price for the supply of electricity
to SMEs to further support those struggling with high energy prices.
Besides helping them to reduce their energy consumption, which is one of the most
effective ways to support SMEs in mitigating energy costs and supply risks, the EU
operates several support schemes focused on SMEs that include financing,
innovation and advice services. Increasingly, these schemes address the clean
energy transition as a priority.
COSME, the programme for the Competitiveness of Enterprises and Small and
Medium-sized Enterprises, funds many initiatives that help small businesses access
finance and improve their business conditions. Programmes such as the Innovation
Fund, InvestEU Fund – SME window and Cohesion funds also support SMEs with
tailored solutions and contribute to enhancing their sustainable growth and
competitiveness, while fostering job creation within them.
Market transformation and innovation programmes such as LIFE CET and Horizon
Europe contribute to supporting the transition towards an energy-efficient,
renewable energy-based and climate neutral EU economy, while making
companies more climate and environmentally friendly, resilient, competitive and
smarter.
Support networks also play a key role to help businesses innovate and grow on an
international scale. Through targeted advice services, the Enterprise Europe
Network, which is the world’s largest support network for small and medium-sized
enterprises, helps companies increase their resilience and support SMEs in their
transition to more sustainable and digital business models. The Covenant of
Companies, a Commission’s pilot initiative, also encourages SMEs to step up their
contribution to a clean energy transition by providing assistance related to energy
audits, the implementation of targets for the reduction of emissions and the
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identification of technologies, methods and financing mechanisms that companies
can use to implement their energy targets.
What national governments can do
National and local governments are best placed to assist small businesses on their
territory. Many support programmes and structures are already in place, including
through financial support (via grants, loans, subsidies, tax relief or a combination
of measures), information/advice services (via awareness raising, guidance,
training, networks), regulation (e.g., supplier obligations and standards) and
national plans or strategies. National or regional energy agencies also play a key
role in supporting EU small businesses, as they are often the first point of contact
for companies looking for advice to reduce their energy consumption and switch
to renewable energy.
Despite the structures already in place, governments can take the following
measures to further support SMEs
 Extend existing subsidy schemes for small businesses. Wherever possible,
this should focus on investments that structurally reduce energy consumption
such as the implementation of energy audit recommendations, replacement of
equipment/appliances with more efficient ones, process insulation, etc.;
 Support energy audits and advice services. Proactively reaching out to
businesses offering them energy audits and advice is a very concrete way to
quickly identify opportunities for reducing their energy consumption;
 Mandate the implementation of audit recommendations. Where possible
companies should be obliged to implement the most cost-effective
recommendations coming from energy audits. This should be underpinned by
financial support.
 Support the implementation of an energy management system (where
appropriate), including energy and CO2 related key performance indicators, and
including them in the company’s strategic decision-making process;
 Strengthen the energy services market, for example by increasing awareness,
reducing transaction costs and providing guarantees;
 Provide financial guarantees for energy efficiency investments to facilitate
access to finance;
 Communicate the multiple benefits of energy transition measures within
companies, such as productivity increase through better indoor conditions for
people and machines, risk reduction due to energy cost fluctuations, employer
attractiveness, etc.;
 Support the switch away from fossil fuels towards electrification, connections
to central steam production (where available) and the use of heat pumps and
excess heat for the supply of low-temperature processes;
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 Support employee-led initiatives and behavioural campaigns to motivate
people to reduce energy use in the workplace (and in the home) through the
inclusion of employees in their energy saving initiatives.
 Facilitate networking of multiple companies to simultaneously develop their
energy audits or energy management systems, sharing best practices, joint
training, etc.;
 Ensure easy access to relevant information, for example on funding
opportunities, advice services, business networks, where appropriate in
collaboration with trade associations.
There is an important role for national or regional energy agencies in supporting
small businesses. Often, they are the first point of contact for companies looking
for advice on how to reduce energy consumption and switch to renewable energy.
An overview of all European energy agencies can be found through the Network
of European Energy Agencies (Members – European Energy Network (enrnetwork.org))
and on the ManagEnergy website: ManagEnergy.
What small businesses can do
Understand your energy use
A better understanding of where, how and why energy is used can help a business
unlock multiple opportunities for both immediate savings and longer-term
efficiency improvements. An analysis of energy bills and processes can be the first
step, followed by increased monitoring of management systems for continuous
improvement.
 Smart meters and controls - when used to identify energy saving opportunities and
manage energy use - can reduce energy use by up to 40% at little or no extra cost.
 Energy audits play a crucial role and have most impact when they include a
method to certify the savings achieved. They have been proven to provide
potential average savings of 18% of total energy use.
 Energy Management Systems that set out achievable targets for energy use and
action plans to reach targets and measure progress can lead to an average
reduction in annual energy use of between 10% to 17%.
Involve your workforce
Employees are valuable resources, uniquely placed to understand the
organisation’s energy use, identify efficiency opportunities and undertake energy
saving actions. Actively engaging the work force on measures to increase energy
efficiency and savings has been shown to benefit both the employee and the
organisation. Energy training and awareness campaigns, with the appointment of
energy officers and an energy team, have been shown to deliver almost 6% annual
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energy savings, which increases to 21% when combined with technological
support and expertise.
Introduce efficient technologies
Replacing inefficient equipment, even before the end of their useful life, with new
best-in-class efficient equipment can lead to immediate energy savings, typically
with short payback times, and can reduce reliance on unsecure fossil fuel sources.
 Lighting - LED lights last up to five times longer than traditional bulbs and use up
to 90% less energy.
 Motors and motor systems - The energy cost of the typical electric motor over 20
years of service is 50 times its purchase price. For every euro invested in
improving the energy efficiency of motor-driven systems, at least seven will be
saved in energy use over the lifetime of the equipment
 Boilers and Heaters – For most space heating and processes in small enterprises,
an efficient heat pump is four times more efficient than a traditional fossil fuel boiler
and reduces the business’ reliance on unsecure fossil fuel sources.
 Compressors - Energy accounts for more than 75% of the ownership cost of a
compressor. Correct sizing of the compressor load can reduce the energy
consumption of a compressed air system by over 1/3.
EU businesses, citizens and public authorities can consult the European Product
Registry for Energy Labelling (EPREL) to obtain information and compare the
energy efficiency and other details about a wide range of products.
Good housekeeping and maintenance provide immediate
savings
An average small business could reduce its energy bill by up to 30% by
implementing good housekeeping and maintenance measures.
 Heating and Cooling: Heating costs increase by around 8% for every 1oC increase.
Smart programmable thermostats can cut heating costs by between 5% and 15%.
Additional low cost measures such as lowering boiler flow temperatures and
insulating/draught proofing doors and windows can deliver immediate savings
 Refrigeration: Refrigeration can represent up to 50% of electricity costs for some
businesses. Maintenance alone can decrease refrigeration energy use by up to
10%.
 Compressed air: Compressed air can be responsible for 10% of an enterprise’s
energy bill, and half of which can be due to easily repaired leaks. Furthermore,
reducing air pressure by just 10% can lead to 5% energy savings.
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 Motors and Drives: Increased control over motor operating parameters can reduce
energy use by 15%-40%. Replacing a conventional motor driven pumping system
with an energy efficient system can result in a 57% reduction in energy use.
 Lighting: Lighting can be responsible for up to 40% of a building’s electrical use,
and using lighting controls has been shown to reduce lighting energy use by over
one third.
 Insulation: Simply insulating pipework has been found to reduce energy losses by
over 75% while maintaining comfort levels.
Additional resources
 Coping with the Crisis: Increasing Resilience in Small Businesses in Europe through
Energy Efficiency
 Action and measures on energy prices
 Entrepreneurship and small and medium-sized enterprises (SMEs)
 Energy efficiency
 EPREL - European Product Registry for Energy Labelling
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