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Green Business Grants and Loans in the UK: Sustainable Funding Guidelines

Green Grants and Loans in the UK

With growing awareness of various ecological issues, more companies are committing to sustainable practices. Implementing and maintaining these responsible actions are great ways to show your values and create a like-minded community around your products and services. However, on your journey to building a green company, you will need financial support. Today, we will share several strategies for attracting funding for your sustainable business and list what grants are available. In this article, we will primarily focus on the opportunities for companies that work in the UK market. However, some advice is universal and will be useful for companies operating in other countries.

What Does It Mean to Be a "Green Business?"

The definition of "green company" is comprehensive; however, in terms of getting government support, it can be narrowed down to one main metric. To evaluate whether the business is worth investing in, organizations usually use the ESG. This approach includes multiple principles of environmental, social, and governmental factors of a company's activity. 

From an environmental perspective, the ESG method evaluates whether the business aims for carbon reduction, utilizes renewable energy sources, minimizes waste, lowers greenhouse gas emissions, etc.

Apart from that, the company should be transparent about its sustainable goals and the results of implementing green practices. Regularly published reports on this topic show investors that the company is committed to sustainable values. Moreover, understanding the ESG criteria can help business owners find new directions for sustainable development. This approach provides a complete overview of tactics that can be used for creating a conscious, environmentally aware and responsible company.

Thus, to define your company as a green business and prepare to apply for a grant, go through the ESG parameters. That will also help you correct your business strategy and fill in the grant application in accordance with the latest sustainability norms.

Green Government Grants

As green initiatives are funded mainly by governments, this type of funding is the first thing to examine. This financial support is usually provided to companies that work in the country from which budget the grant program is sponsored. 

This article will mention several examples of the UK government grants that support local green projects. Even if you cannot apply for them because your business is located in another country, you will probably find similar support programs in your region by contacting the local authority.

Green Government Grants

DEFRA Grants

For green companies operating in the UK, applying for the Department for Environmental, Food and Rural Affairs (DEFRA) grants might be the best option. They primarily focus on supporting rural communities, agricultural businesses, and businesses that protect the local environment. In 2023, DEFRA spent more than £168 million on UK sustainability grants. 

Net Zero Living Grants

The Net Zero Living program aims at helping micro and small businesses on their way to carbon neutrality. The organization supports innovative companies implementing data-driven digital approaches to support the net-zero agenda. 

The grant request amount should be between £25,000 and £50,000. Together with the funding, you will get business support from Innovate UK EDGE.

UKSPF Grants

The UK Shared Prosperity Fund is an organization that helps local communities and spreads opportunities across all parts of the country. UKSPF has several grant options for different regions and towns. Getting help from these programs in your area will provide a broad range of targeted assistance and professional business advice.

Green Entrepreneurs Fund Grants

In collaboration with the University of Derby, this fund supports local UK businesses on their way towards creating a green economy. They have several programs for initiatives of different sizes:

  • Green Entrepreneurs Demonstrator Fund supports big projects aimed at creating alternative energy sources and lowering carbon emissions. The minimal grant size is £100,000.
  • The Green Entrepreneurs Small Grant Fund has been created to support small businesses with game-changing proposals in eco-initiatives and green technologies. The size of the maximum grant from this fund is £20,000.
  • Green Entrepreneurs Scholarship Fund provides support not to businesses but to individuals. As an entrepreneur, at the beginning of your green journey, you can get professional consultancy on how to maintain your business in a sustainable way.

Low Carbon Energy Efficiency Grants

If you run a business in Scotland, the Low Carbon Energy Efficiency Grant is the option you should closely examine. With funding up to £10,000, you will be able to reduce carbon emissions, strengthen your green credentials, improve energy efficiency, and achieve net zero.

Green Loans

The second option you have in terms of attracting funding for your business is to apply for green bank loans. Multiple bank organizations across the country have financial support programs for green projects. Contacting your bank to ask whether they offer similar options might be a good idea.

What Are Sustainability Linked Loans?

These loans provide support to green projects that offer innovative projects and increase energy efficiency. The conditions of green loans are always fairly similar: they provide lower interest rates than the typical loans, increased cashback, and extended repayment periods.

Green Loans

Other Funding for Green Businesses and Sustainable Projects

Funding opportunities for green projects are not limited to government grants and loans. For example, there are non-governmental organizations that offer grants to sustainable businesses. Here are some of these options:

WRAP Grants

This international NGO raises awareness about climate change all over the world. In the UK, WRAP has multiple grant initiatives that used device businesses can apply for. One such example is the Resource Action Fund, which supports responsible waste management. 

Besides that, WRAP supports recycling businesses — read our article on R2 certification to find out more about e-waste recycling. 

LCIF Grants

The Low Carbon Innovation Fund (LCIF) invests in start-ups that are aimed at reducing carbon footprint, promoting a circular economy, and providing optimized energy solutions. The NGO has funded over 50 various sustainable initiatives with an overall value of deals worth £1.5 billion. 


All in all, multiple grants are available, and numerous options exist to gain additional funding for your sustainable projects. Search for green grants and loans in your region, paying attention to both governmental and non-governmental sources. Moreover, consider support programs of different sizes — apart from national, also look for regional and local opportunities. 

One more thing that will have a significant impact on your green journey is Reeva, the NSYS robotic solution. One robotics line can process up to 70 devices per hour, hugely benefiting the overall turnover of devices while extending their lifecycle. 

Try Reeva to contribute to the circular economy! 

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