Carbon Trust offers interest free loans to green companies

The Carbon Trust has begun offering £100m in interest free loans to businesses that are investing in energy-efficient plant and machinery.

By Richard TylerLast Updated: 4:22PM BST 04 May 2009

Some 763 businesses secured loans last year and the trust expects to double that number this year following the Government's decision to increase the trust's loan fund in the Budget.
Hugh Jones, director of solutions at the trust, said: "There's always been financial benefit from carbon saving but we are bringing it closer to home by offering the money interest free. Come and get it."

Last year the trust, an independent company funded by government, lent the £23m of new money it had been given, but an additional £5m of loan repayments was not recycled because of a lack of demand from the target companies, some of whom had struggled to raise additional bank finance for their investment plans.
The trust has now revamped its application process, it said, reducing approval times from four to six weeks down to, on average, 10 days.
It is also considering widening the criteria so that larger sums can be lent and bigger companies can apply.
The £100m, which will be lent over two years, is restricted to small and medium-sized businesses in England looking for between £5,000 and £200,000. Large companies can apply in Scotland.
Tom Delay, chief executive of the trust, said that companies could reduce their energy costs by up to 20pc by investing in efficient plant and machinery like lighting and heating systems.
The trust has drawn up a map of the hot spots in the country where businesses could save the most money.
It estimates that businesses across the country could save £2.5bn a year if they made their operations more energy efficient.
By region, the most savings can be achieved in Greater London, the South East and the North West.