Although the small and medium-sized enterprise (SME) sector is the backbone of the European economy, generating more than half of the EU’s GDP, its role in the green revolution remains surprisingly marginal. The latest report published by the Solar Impulse Foundation and Schneider Electric, entitled Unlocking SME Competitiveness in Europe, sheds light on an important paradox. Although these companies account for 99 per cent of all players in the market, only 11 per cent of them are making significant investments in sustainability. This sluggishness could cost the European economy billions of euros in potential value lost by 2030.
The authors of the study point out that the key to unlocking this potential is the synergy of electrification and digitalisation. Estimates are promising: the implementation of appropriate technologies would reduce the sector’s energy consumption by 20 to 30 per cent and, in some industries, reduce CO2 emissions by up to 40 per cent. However, the problem lies in the approach to strategy. The report makes a clear distinction between ad hoc measures and long-term plans. While as many as 93 per cent of companies are taking single efficiency measures such as replacing equipment, only a quarter have developed a comprehensive decarbonisation strategy.
The market needs systemic solutions, not just spot-on implementations. Digital integration is now a matter of tough competitiveness and cost control, not just image. Indeed, smaller players, due to their limited bargaining power, are extremely vulnerable to energy price shocks, making them ideal candidates for the adoption of models such as Energy-as-a-Service.
However, this transformation faces infrastructural barriers. Europe, wanting to increase the electrification rate to 32 per cent by the end of the decade, has to face the fact that 40 per cent of electricity grids are over 40 years old. This modernisation requires an investment of €584 billion. Against this backdrop, the report calls on policymakers to take urgent action, including simplifying permitting procedures and revising tax directives, which could lower investment risks for the SME sector and accelerate the adoption of modern energy technologies.
