**Dublin**: Ireland’s ambitious Climate Action Plan aims for a 35% reduction in enterprise emissions by 2030, posing significant challenges for SMEs. Expert Russell Smyth shares sustainable strategies that not only minimise emissions but can also increase profitability through energy efficiency and government support.
Ireland’s Climate Action Plan has set an ambitious target to achieve a 35% reduction in enterprise emissions by the year 2030, presenting a significant challenge for small and micro enterprises (SMEs) across the country. While larger corporations typically have the resources and stakeholder pressure to navigate these environmental requirements, smaller enterprises must find a balance between adopting sustainable practices and maintaining commercial viability.
Russell Smyth, who leads the energy advisory business at KPMG, has outlined various strategies for SMEs to enhance their sustainability credentials in a way that is financially manageable. In his insights published by Business Plus, Smyth highlights that improving sustainability can also lead to increased profitability.
One of the primary avenues for SMEs to reduce emissions is through energy efficiency measures. The implementation of LED lighting, smart heating controls, and energy-efficient appliances can collectively contribute to a marked decrease in energy consumption. To facilitate these changes, the Sustainable Energy Authority of Ireland (SEAI) offers grants for energy audits, allowing SMEs to identify areas of inefficiency without incurring heavy up-front costs. Smyth encourages small businesses to leverage available Government support, as Ireland provides various grants, training initiatives, and tax incentives, such as the accelerated capital allowance, which rewards investments in energy-efficient equipment.
Demonstrating the practical effects of these measures, a study conducted by KPMG in 2021 revealed that the average dairy farm in Ireland could reduce emissions by 13% annually while also increasing profitability by an estimated €5,100 simply by adopting proven practices such as enhancing on-farm energy efficiency, optimising fertiliser usage, and integrating multispecies sward crops.
Smyth emphasises that sustainability is a journey for SMEs, suggesting that they should begin with modest targets and progressively work toward more ambitious goals. Free resources provided by the SEAI and the Environmental Protection Agency (EPA) can help businesses establish their baseline emissions, thereby enabling them to refine and track progress. Engaging employees, suppliers, and customers in this process is important, as sharing sustainability targets and achievements can foster trust and loyalty among stakeholders.
Another strategy indicated is to localise and green supply chains. By sourcing materials locally, SMEs not only contribute to the Irish economy but also reduce associated emissions. Collaborating with suppliers who prioritise sustainability and selecting eco-friendly materials can amplify their impact on creating more resilient supply chains.
The digital transformation is another significant factor. The shift to remote or hybrid working models diminishes commuting emissions and reduces office energy consumption. The use of digital tools can streamline operations, decrease paper waste, and further cut in-house energy use and emissions.
Transport is also a critical area for emissions reduction. For SMEs with logistics requirements, transitioning to electric vehicles (EVs) offers substantial savings on fuel costs. The total cost of ownership for an EV is considerably lower compared to traditional internal combustion engine vehicles, and government grants are available to support this transition. Additionally, initiatives like bike-to-work schemes and tax saver public transport tickets provide employees with options to reduce commuting emissions at minimal cost to SMEs.
Finally, as businesses grapple with rising electricity costs, the option of integrating solar photovoltaic (PV) technology should be considered. While initial capital investment is required, the increased unit cost of electricity in Ireland has reduced payback periods for solar PV installations to as little as three to four years, further incentivising SMEs to adopt this technology.
In summary, SMEs in Ireland have various pathways available to improve sustainability while also bolstering profitability, according to KPMG’s Russell Smyth. The integration of energy-efficient practices, leveraging government resources, collaborating with local suppliers, embracing digital advancements, and adopting sustainable transport options are all essential components of this transition, as businesses work towards the emissions reduction targets set out in Ireland’s Climate Action Plan.
Source: Noah Wire Services
