It’s easy to become nostalgic about those good old days when environmental responsibility was on the tip of everyone’s green tongue and people were throwing interest-free money at you to roll out whichever eco-friendly scheme for your business took your fancy. 

Because, nowadays, things are tougher. The lending atmosphere and the environmental goodwill appear to have lessened in the face of still-difficult economic conditions. There’s a new reality at work and hence there should have been little surprise that, when the Carbon Trust loan scheme – the leading interest-free financing scheme for environmental projects in the UK – was relaunched last April, it was a much-changed beast to what it once was. 

The question for printers is whether the new scheme, now very much a commercial enterprise, is still of any use for those wishing to pursue environmental initiatives. 

Over the 10 years the scheme has been running, it’s been an evolving initiative of varying scale and application, but the fundamental tenets have always been that repayments are paid for by the savings made through the investment, and that there would be no interest to pay on that investment. But in the new system, the latter has disappeared and the former is no longer a must. The cause is the coalition cutbacks. 

"We saw significant reductions in our funding as we were almost entirely funded by the government," explains Myles McCarthy, managing director of Carbon Trust Implementation Services. "Obviously, with the restraints on government funding, we could see the money for the loan scheme disappearing. To prevent this, we went out to the market and partnered with Siemens Financial Services."

The new scheme is a commercial enterprise with commercial terms – so out go interest-free loans and in comes a rate McCarthy describes as "competitive" and dependent on the details of the deal. The positive side is that the trust has been able to be much more flexible about the loans it offers – finance can now be provided ranging from £1,000 to millions of pounds. Repayments are no longer as strictly tied to equate to the savings made through the investment either, which McCarthy says again means more flexibility.

"In most circumstances, the energy savings can fully fund the financing costs of any capital investment," he explains. "However, we do recognise that full coverage of the repayments is not always going to be achieved from the project. This does not mean the project cannot be financed through the scheme; this is different from the 0% scheme, which would only provide funding up to the level that would be covered by four years of energy savings."

As to what the scheme might facilitate, once again, flexibility is the name of the game. The standard projects previously considered – low-energy lighting, heating controls, power controls, insulation – are still eligible but because of the lack of a higher spending limit, large-scale investments in renewables are now more plausible, as are press investments. 

"Presses are a significant consumer of energy and we believe there are savings to be had there," says McCarthy. "There will be significant productivity and energy benefits from an upgrade to a newer machine and we are not going to be frightened off by the size of a transaction; the company in question just has to prove to us that it is a worthy investment."

Flexible as the new scheme is, the loss of the 0% interest part of the loan is significant blow to printers struggling in the harsh credit situation of the current market. Indeed, it was this feature alone that made the previous schemes so attractive, according to Harry Skidmore, chief executive at Easibind, who used the old 0% interest scheme extensively. 

"This new scheme has undone the whole principal about what the carbon scheme loans were originally about," he explains. "The agreement used to support revenue-neutral, stick-and-carrot policies to encourage green investment. It’s now a compromise scheme, which is a commercial agreement with lots of rules and limits, so should be treated accordingly."

Source of credit 

That said, the Carbon Trust scheme may be an easier finance option if the eco credentials can be proved, with banks not falling over themselves to offer loans, but proving the energy-efficiency savings could be problematic for some of those investments. 

At the lower end of the scale – lighting controls and heating measures and the like – the energy savings are relatively easy to quantify and substantiate but, with interest on the loan and the capital expenditure relatively low, the majority of printers may opt to avoid finance altogether and pay for the schemes outright instead. 

Where the scheme is likely to be more attractive is for larger capital expenditure in renewable power or printing hardware. Unfortunately, the former is incredibly difficult to implement and, with the latter, it is almost impossible to prove efficiencies.

With regards to a press investment, McCarthy says the Carbon Trust would be looking to the kit suppliers to assist printers in formulating the environmental case for the new press or piece of print kit. Adam Robotham, director of sheetfed sales at Manroland GB, says that, while his company is happy to help, it’s not as simple as just formulating some figures. 

"It is very complicated to nail down the carbon footprint of all the myriad items on a press and that a press uses," he says. "To formulate a reliable assessment of the improved carbon performance of the press you would have to get all the suppliers that contribute to the print process – kit, paper, ink, other consumables – to formulate their carbon footprint and to do so in the same way."

Environment consultant Clare Taylor agrees. She says that, in theory, there is no reason that printing equipment such as a press could not be financed through the Carbon Trust scheme, but in practice she says there are issues.

"A major factor is how much work is being put through, for example – the saving is going to be subject to how much the press is used," she explains. "A lot of sums would have to be done to be able to prove any energy advantage."

At Easibind, this kind of carbon insight is possible, but Skidmore says that this is down to extensive "hard work" the company has done itself and that expecting the supplier to create the figures instead would be "naive". He adds that there is no short-cut to getting the figures and that even when you get hold of them through consultations and extensive monitoring and tracking, the lack of standardisation as to how carbon calculations are done by suppliers still creates unreliability – something he is campaigning to address. 

McCarthy counters that he realises the issues involved and that "certain assumptions" in the business case are inevitable, but as long as the printer understands those assumptions – i.e. that the savings may not match the repayments – then he does not see an impenetrable barrier. 

Substantial barriers 

On the renewables side, though, there are also issues. On paper, wind turbines or solar panels seem like a sound investment, especially with the government’s feed-in tariffs providing an extra monetary incentive to switching. However, the strict planning and practical restrictions make renewables difficult for many printers to roll out in any meaningful way. For solar panels, you need a substantial, south facing roof space to line with solar cells if you are to get any meaningful power from a very expensive investment. On the wind-turbine side, the barriers are also substantial, according to Ron Davidson, owner of PM Solutions which has just been granted planning permission for two 50 megawatt, 30m turbines. 

"Our investment is around £380,000 but the real barriers are practical," he reveals. "It depends on the council, but most say the turbines have to be 700m from the nearest dwelling. We had to reduce our turbine size from 40m to 30m to prevent a ‘blot on the landscape’. We had to pay for a bat survey. You have to have the right type of wind – too slow and you don’t generate enough power, too fast and the turbine has to be switched off to avoid it coming off its axis. It is an extremely difficult and lengthy process."

Fin Payne of CF partners, an environmental advisory company, argues that renewable projects make no financial sense. He says that companies should invest in smaller projects to make themselves as efficient as possible, but to go the extra mile there are better, cheaper, options. 

"We advise that, for SMEs, at the moment, renewables such as solar panels are just not cost effective," he explains. "There are cheaper ways of becoming a greener company – we believe offsetting your carbon by investing in green schemes is the best for those who want to go further at the moment."

The trouble with offsetting is that you are not dealing with your own problems, you are essentially paying to be able to be as polluting as you want – as Skidmore says, it is "like a Catholic doing something wrong then going to confession". 

But, if smaller projects are affordable without the need for a loan that carries hefty interest and larger projects are difficult to roll out and nigh on impossible accurately to quantify in terms of energy savings, what has the Carbon Trust loan scheme got to offer printers?

Well despite scepticism, McCarthy explains that since April the scheme has helped companies of all sizes tackle both small and large projects, from the smallest light sensors to the largest capital investments in renewables and kit – so proving a case to win finance is clearly possible. The complications for printers are clearly a concern, but McCarthy believes the new scheme has the flexibility to help the industry be greener and reduce both energy and costs – whether the printers will agree remains to be seen.