British SMEs set to lead demand for greener goods

British businesses are set to make the greatest effort to go green over the next two years compared with their EU counterparts, but just a third have developed their own environmental products.

That is the stark finding of a major new Eurobarometer survey for the European Commission analysing how much the bloc’s 21 million SMEs are boosting resource efficiency and entering the green market.

The wide-ranging survey reveals that UK SMEs are among those leading the drive to save resources, particularly waste and energy. Eighty three per cent of UK SMEs said they were taking action to save energy, compared with the EU average of 64 per cent.

The report found that UK firms are set to make more effort than any EU SMEs to save waste and energy over the next two years. More than 80 per cent of UK firms plan to take extra steps to save energy, while nearly 90 per cent plan to step up their efforts to minimise waste and recycle more.

Significantly, the uptake of renewable energy is set to double over the next two years. While 12 per cent of SMEs currently use green energy, including on-site production such as solar panels, 27 per cent plan to increase their use of green energy by 2014.

SMEs cited financial incentives such as feed-in tariffs as the main reason for going green, as well as preparing for tighter legislation in future, such as higher landfill taxes. A third said they were driven by a company commitment to curb its environmental impact.

However, the report also found that, in line with the EU average, only a third of UK SMEs have tapped into the emerging green market, such as by creating products using recycled material or developing consultancy services.

But the vast majority of UK SMEs that do offer green products are mainly targeting the national market, with just a third selling to other member states and even fewer tapping into overseas markets.

European Commission vice president for industry and entrepreneurship Antonio Tajani warned that too many green businesses had a limited reach and urged them to expand their global presence.

“I am happy to see that SMEs are taking on this huge untapped potential, which will pay off with more innovation, more competitive SMEs and more jobs. However, there is still a lot of work to do,” he said.

“Only a few European SMEs extend their green business to foreign markets. Knowing that the EU makes up roughly one third of the world market for environmental industries means there is a huge potential for SME growth.”

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