Several decades ago, few businesses took the initiative to investigate green energy sources to meet their growing energy demands. However, in today's world it's not uncommon for companies to determine technologies such as wind power or solar energy installation will be a practical and cost-effective investment. In fact, going green is slowly becoming the norm for businesses across the country and around the world.
Making the initial investment
While sustainability can have major benefits for companies, such as lower energy costs and a stronger reputation with consumers, the investment can be unaffordable to some in the beginning. According to The New York Times, subsidies for the renewable energy industry are extremely limited when compared to the natural gas sector; this can in turn make green energy more expensive for businesses to implement, as sustainable technology firms continue to seek investors to finance new projects.
"We've made great progress in bringing down the cost of renewable energy technologies like wind turbines and solar panels," said Dan Reicher, executive director of the Steyer-Taylor Center for Energy Policy and Finance at Stanford University, according to The New York Times. "Where we haven't made the necessary progress is on bringing down the cost of financing he projects that use that equipment, so the cost of renewable energy is higher than it needs to be."
Financing the cost of sustainability
For many smaller firms, funding the cost of green energy installation could be a major expense that isn't easily covered. In these instances it may be helpful for company owners to seek project finance that will allow them to invest in these new technologies without struggling to pay their bills.
However, business financing has become more difficult to get in recent years, especially for smaller startups or firms in unconventional or risky industries. How can an entrepreneur manage to get loans that will cover sustainability projects? More are considering working with small and mid-sized banks to achieve these goals. Smaller institutions are often more willing to hand out loans than big banks, making it easier for firms to achieve their green goals and install clean energy sources.
But small banks can do much more for businesses than lend the money necessary for green projects. Smaller institutions can also provide more personalized solutions to ordinary business banking needs, helping entrepreneurs better manage their company accounts and achieve other goals.
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