Regional disparity in funding access for food and drink business’s sustainable projects

New research, commissioned by the Scotland Food & Drink Partnership’s Net Zero Commitment found that food and drink businesses in some regions of Scotland have more access than others to funding for sustainability initiatives.

The research found that out of 22 grant opportunities available for businesses in the sector, 59% (13) were provided by local councils. Some of Scotland’s largest local authorities had current specific grant funding for food and drink industries to support sustainability initiatives[1].

Of the local authority grants, two thirds (69%) are capped at or below £10,000, where technologies like industrial air source heat pumps can cost multiple times that amount. Most grants were restricted to capital expenditure or ‘green asset’ projects like low carbon heating, insulation, LED lighting and similar technologies. Many grants will cover up to 70% of project costs but are only paid after the work has been completed, putting pressure on business cashflows. Highland Council was found to be comparatively more supportive, with grants of between £25,000-£150,0000 available.  

Scotland Food & Drink Partnership’s Net Zero Commitment aims to ensure that every business within the sector understands Net Zero and the steps required to get there. It commissioned the report to understand the funding landscape available to food and drink businesses to identify opportunities and highlight where more support is required to reach our national Net Zero ambitions.

Four Scottish public bodies currently offer grant funding – Business Energy Scotland, Scottish Enterprise, Skills Development Scotland, and Rural Payments and Services.  Almost half (10) of all available grants were specifically for SMEs.

Iain Clunie, Net Zero Programme Director, at The Scotland Food & Drink Partnership’s Net Zero Commitment, said: “Food and drink businesses are, by and large, on-board with the need to reduce emissions for both the good of our planet, and for the future viability of their businesses. But that knowledge and desire to take practical steps towards reducing emissions needs to be met with a funding landscape that supports that ambition.

“While there are some great opportunities out there for businesses, there are regional disparities and hoops to jump through that could be preventing many of Scotland’s 17,500 food and drink companies from becoming more sustainable. 

“Scottish food and drink businesses account for 10% of all businesses registered in Scotland, and 98.8% of food and drink companies are SMEs. They need the support of funding and expertise to decarbonise through proven sustainable solutions, technologies, and practices. Beyond existing, tried and tested options, businesses also need to be incentivised and supported to innovate to tackle areas of the supply chain that are more difficult to decarbonise.

“The Net Zero Programme will continue to work on behalf of the industry to ensure business can access the support they need, and we welcome open discussion with potential funders around the challenges.”

To find out more about sustainability in Scotland’s food and drink sector, please visit: bit.ly/FDFNetZero

[1] Highlands & Islands, East Ayrshire, West Lothian, East Renfrewshire, Falkirk, Fife, Glasgow, Perth & Kinross, and Renfrewshire councils all had live grant funding opportunities at the time of writing.