As the pressure to meet net zero targets intensifies, UK businesses (particularly small and medium-sized enterprises (SMEs)) are increasingly turning to financial support to fund their sustainability goals.
In 2025, a wide array of grants, loans, and incentives are available to help businesses reduce emissions, improve energy efficiency, and invest in green technologies.
Government Grants and Support
The UK Government has committed nearly £5 billion to support businesses on their net zero journey. Its Find a Grant service helps SMEs locate up-to-date funding across sectors and regions. For businesses with high energy use, the Industrial Energy Transformation Fund (IETF) offers support for energy efficiency upgrades and low-carbon technologies.
Devolved administrations provide tailored schemes. Scotland’s SME Loan Scheme includes cashback grants of up to £30,000, while Wales’s Green Business Loan Scheme offers flexible loans via the Development Bank of Wales. Northern Ireland businesses can access the Sustainable Energy Programme through the Energy Saving Trust, with additional grants listed on Invest NI’s Business Support Finder.
Bank Loans and Green Financing
Several UK banks now offer preferential financing for sustainability initiatives:
- Lloyds Bank supports green investments via its Clean Growth Financing Initiative.
- HSBC offers up to £300,000 through its Green SME Fund.
- NatWest and RBS both provide Green Loans for clean energy and energy-efficient building upgrades.
- The Co-operative Bank funds renewable projects, from EVs to LED lighting.
- Bank of Ireland offers discounted Green Business Loans, including for farms.
Other Sources of Funding
Additional support comes from community-focused schemes and specialist funds. SSE’s Community Funds have backed over 9,000 sustainability projects across the UK. Meanwhile, the Sustainable Community Buildings Programme in Northern Ireland supports upgrades to improve environmental performance.
For capital-intensive improvements, UK-wide tax incentives such as the Annual Investment Allowance and Structures and Buildings Allowance enable businesses to offset green investments against tax.
Getting Started
To take advantage of these opportunities, businesses should assess their current energy use, create a retrofit plan, and explore relevant schemes via platforms such as GOV.UK, Business Energy Scotland, or the Carbon Trust. With the right support, sustainability doesn’t have to come at a financial cost—it can be an investment in future resilience.
