Reducing carbon emissions in small businesses 

If you’re a business owner looking to become more environmentally responsible in your practices, April is the perfect time to bite the bullet. #EarthDay was first started in 1970 after a huge oil spill caused environmental havoc in California. It has grown to become a global movement that spans the whole month of April (#EarthMonth). It’s a chance to raise awareness of our impact on the planet and is a good opportunity for businesses to review and reduce their carbon footprints. 


Carbon Emissions Reporting for UK Businesses 

As well as being the environmentally responsible thing to do, becoming more sustainable can save businesses money and attract new customers. Research shows that 73% of businesses that employ sustainable practices  experience sales and marketing benefits, while 43% see growth in production, sales or revenue.  With the Government focused on Net Zero, it looks likely that more and more businesses will become subject to legislative pressure to reduce emissions. 

In April 2022, the Companies Act 2006 was amended to make it a legal requirement for large companies to report on energy usage and carbon emissions. To ensure accountability and compliance, companies that cannot provide the required information must explicitly state the reasons for not doing so. The rules apply to companies with 500 or more employees and £500m in turnover – equating to around 1300 companies across the UK. 

While SMEs make up more than 99% of the UK economy (and generate 44% of the UK’s greenhouse gas emissions), they are not legally required to report their carbon emissions. However, rumour has it that the government plans to extend mandatory emissions reporting to the wider UK economy, by 2025. 

With that in mind, how can UK SMEs reduce their carbon footprint? 


Simple ways to reduce carbon emissions


Calculate your environmental impact 

Changes to any business process should always start with data. After all, you can’t manage what you can’t measure! 

The Carbon Trust has a carbon calculator specifically for SMEs, which can help companies understand their emissions in line with GHG Protocol Guidance – a comprehensive global framework for measuring and managing greenhouse gas (GHG) emissions from private and public sector operations and value chains. The calculator covers direct emissions from fuel and production processes, and emissions from purchased electricity for the assets they operate. Having a good understanding of your current position is a great way to identify incremental changes. 

When calculating the environmental impact of your business, it helps to understand the difference between different types of emissions. The National Grid website provides a simple explanation, based on the Greenhouse Gas Protocol. 

  • Scope 1 covers emissions from sources owned or controlled by the business – for example from fuel in a fleet of vehicles.
  • Scope 2 covers emissions that a company causes indirectly. For example, the emissions caused by generating the electricity that is used in buildings.
  • Scope 3 covers emissions that are produced by activities up and down its value chain (i.e. not directly owned or controlled by them). Scope 3 emissions include all sources not within the scope 1 and 2.


Reduce emissions from company vehicles 

Reducing Scope 1 impacts requires businesses to change internal processes away from polluting activities, or to reduce the emissions associated with these activities. One of the most obvious ways to do this is to look at company-owned vehicles. 

Wherever possible, opt for company vehicles that produce lower emissions – this article from Which is a good guide for companies with car fleets. If changing your vehicles is not an option, use fleet management software or telematics that can track driver behaviours, and use the data provided to educate your fleet drivers on how driving habits can impact fuel consumption. Combine this data with route tracking software, and fuel station finders, to help optimise routes and reduce unnecessary mileage. 


Consider switching to an electric fleet 

One of the primary drivers behind the transition to EVs is the reduction of carbon emissions. Traditional vehicles powered by fossil fuels contribute significantly to air pollution and climate change. By opting for EVs, businesses can significantly lower their carbon footprint and contribute to a cleaner, greener future. 

Read our blog to find out more about transitioning your fleet to electric vehicles. Or, if you already have an EV fleet, consider using our EV charge card, which gives you access to a huge network of EV charge points, using electricity from 100% renewable energy sources.

Review energy usage 

Reducing energy use is one of the most common steps being taken by SMEs to reduce their operational costs, while also becoming more sustainable, according to a report from Sage, Oxford Economics and the International Chamber of Commerce (ICC). 

There’s lots of advice available for small businesses looking to reduce energy consumption – from buying more energy-efficient machinery and appliances to changing office layouts, using thermostats to manage heating, and opting for more energy-efficient lighting solutions. The SME Guide to Energy Efficiency, published by the governmental Department of Energy and Climate Change, has some useful tips, which are simple to implement and can help to reduce scope 2 emissions. 


Switch to a clean electricity provider 

Consider switching your energy supplier. Using information about your current rates and usage, as well as in-depth knowledge of the latest trends and pricing structures, our energy team can negotiate favourable rates with energy suppliers and guide you towards renewable energy options. As well as helping to reduce your carbon footprint, the team can save a whopping 75% off your current bills. 

Carbon offsetting for businesses

Carbon offsetting allows businesses to purchase emissions credits that are used to fund green projects such as reforestation, renewable energy, and carbon capture. While carbon offsetting does not actively reduce emissions, the idea is that businesses compensate for their emissions by reducing carbon elsewhere. 

Carbon offsetting has come under some criticism when companies simply buy credits and take no further action to employ sustainable practices – so it is important that companies select a reputable and verified partner and are proactive in finding other ways to reduce their impact. At The Fuel Store, we work with Forest Carbon to offset our carbon footprint and have set up a Clean Air Partnership, which helps our customers to offset their emissions in a verified and responsible way.


Review your supply chain 

As well as looking at Scope 1 and 2 emissions, SMEs can influence and reduce Scope 3 impacts by reviewing the emissions generated in their supply chains. This might be reducing procurement of new equipment, conducting preventative maintenance to increase the service life of existing equipment, switching to recycled packaging of goods, or using downstream suppliers that employ sustainable practices. 

The other thing to be aware of is that larger companies will also review their supply chain and Scope 3 emissions. If you supply goods and services to other businesses, there may be pressure on you to reduce your emissions upstream, as well as downstream. 

Want to find out more about how to reduce energy bills via green suppliers, improve fuel efficiency, or offset your carbon? Speak to our team today.