How start-ups can take advantage of the cheap energy dilemma in Europe

Europe is facing an electrical dilemma – the rapid development of renewable energy sources, such as solar and wind energy, has caused a significant drop in energy prices, reports the Economist. It may seem paradoxical, but the challenge is that European infrastructure and regulations are not adequate to deal effectively with excess energy.

To address this challenge, several strategies are being considered. These include directing excess energy to regions where there is greater demand, encouraging citizens to use that energy at peak times when it is cheapest, and storing excess energy in forms such as electricity or fuel so that it can be used when production is low.

How does cheap energy benefit the economy?

Renewable energy is much cheaper to produce than energy produced from fossil fuels and benefits the economy in many ways. The first direct benefit is that households and businesses spend less money on energy because it is much cheaper.

Another important benefit is that the clean energy sector creates more jobs compared to the fossil fuel industry. The clean energy transition involves the development, installation and maintenance of new technologies and systems that create employment opportunities. This is observed in many economies. For example, an accelerated clean energy transition could create 15.4 million jobs by 2035.

Renewable energy can also power the economy. Investments in clean energy infrastructure and technology increase GDP because they increase demand for the development of new skills and industries. Countries

Economic growth: Renewable energy can drive economic growth. Investments in clean energy infrastructure and technology increase GDP by creating demand for new skills and industries. Countries that invest in renewable energy often experience higher GDP growth rates. For example, the EU could see a cumulative GDP increase of €7.3 trillion between 2022 and 2036 thanks to investments in green energy.

How does cheap energy benefit SMEs?

Startups and small and medium-sized enterprises (SMEs) can benefit from lower energy costs by using renewable energy.

Lower operating costs can increase profitability and help businesses become more competitive. SMEs can reinvest savings into their businesses and use the funds for research, innovation or other business-scaling activities.

In addition to energy savings, there are other ways in which clean and cheap energy can benefit SMEs:

Better financial planning

Renewable energy sources are often less likely to reflect price volatility compared to fossil fuels. This stability can help companies better manage and plan their expenses, ensuring that they will not face sudden price increases that could arise as a result of geopolitical events.

Accessibility to new markets

SMEs involved in the renewable energy sector may be able to enter new markets and miss out on new opportunities. With the growing demand for clean energy technologies, companies can present their proposals

Access to new markets: SMEs involved in the renewable energy sector can gain access to new markets and opportunities. As demand for clean energy technologies increases, companies offering solutions in this space can expand their reach and increase their revenue streams.

Sustainability and brand perception

Using renewable energy can help small businesses and startups improve their brand image, as consumers increasingly seem to prefer supporting companies with environmentally friendly practices. The adoption of clean energy also supports growing sustainability efforts that have long-term environmental benefits.

How companies can implement renewable energy

Businesses can seriously consider adopting renewable energy solutions to reap the benefits they offer.

With benefits such as enabling businesses to better plan their budgets, gain access to emerging markets and new opportunities, and contribute to a greener, more sustainable planet, it is clear that renewable energy solutions have the potential to transform the way SMEs operate.

Let’s look at the different options and measures SMEs can take to implement green energy:

Types of renewable energy production methods

Depending on your company’s location, SMEs and enterprises will want to consider the options below to choose the best type of green energy generation for their business.

Solar energy: Solar energy is becoming increasingly popular due to its scalability and ease of installation, as photovoltaic panels can be installed on home roofs and in dedicated solar farms.

Wind power: Wind turbines produce electricity using the power of the wind. Wind turbines are a good option for areas with windy conditions and where there is enough land to set up the turbines.

Hydropower: SMEs with access to flowing water may consider using hydropower. This method of generating energy involves installing a turbine that is rotated by falling and flowing water, which generates electricity through movement.

Geothermal energy is also an option, but requires very specific conditions because the plant must be installed over one of Earth’s natural geothermal reservoirs – hot pockets of hot water and steam. Establishing such installations is expensive, but may be feasible if conditions are right, as it is a highly efficient method.

Measures companies can implement to improve energy efficiency

In addition to using renewable energy solutions, companies can implement the following measures to improve their energy efficiency:

First, install LED lighting. They are much more energy efficient than traditional incandescent or fluorescent lamps, significantly reducing energy consumption.

Smart building controls are a modern way for businesses to optimize their energy use, and installing smart thermostats, lighting systems, and power strips can help automate energy usage based on the actual needs of the business.

Compliance with energy efficiency regulations is another way companies can reduce their carbon footprint and optimize energy use.

Finally, improving building infrastructure such as insulation, air sealing and ventilation can also increase energy efficiency as the need for heating and cooling will be significantly reduced.

As Europe prepares for the challenges of low-cost energy, exploring and adopting these clean energy methods can bring huge benefits to SMEs. These benefits include better financial planning, accessibility to new markets, sustainability and improved brand perception.

There are quite a few options to choose from, including solar power, wind power, hydropower, and geothermal power generation. Companies should consider which methods best suit their needs.