The European Union has launched a major financial initiative aimed at transforming the energy footprint of small and medium-sized enterprises (SMEs) across the continent. Backed by €17.5 billion in funding from the European Investment Bank (EIB) and supported by the European Commission, the new program will help over 350,000 businesses accelerate energy efficiency upgrades and decarbonize their operations.

The announcement was made by EU Energy Commissioner Dan Jørgensen and EIB President Nadia Calviño, signaling a coordinated effort between EU institutions and private sector partners to close the energy investment gap among Europe’s small businesses.

Tackling the Investment Gap in SME Energy Efficiency

While SMEs form the backbone of the European economy, accounting for more than 99 percent of all businesses, they currently invest in energy efficiency at only half the rate of larger companies. This gap leaves significant climate and economic opportunities untapped. Through this new initiative, the EU aims to simplify financing for energy upgrades and remove longstanding barriers to adoption.

Read more: Billions in Green Energy Mining Finance Linked to Rights Abuses and Environmental Harm, Report Finds

Commissioner Jørgensen emphasized the urgency of the initiative, noting that boosting energy efficiency in SMEs delivers a triple benefit: it strengthens the economy, cuts emissions, and enhances local resilience across Europe’s communities. With the new program in place, SMEs will gain streamlined access to finance that is often too complex or burdensome to secure through conventional channels.

Targeting Over €65 Billion in Total Energy Investments

The EIB and the European Commission have set an ambitious target for the initiative: to unlock more than €65 billion in total energy savings-related investments by 2027. This scale-up will be achieved through a mix of new and existing financial instruments, including both equity and debt-based solutions.

To ensure effective deployment, the EIB will partner with commercial financial institutions to set up dedicated investment platforms tailored specifically to SME needs. These platforms are designed to channel funding into practical, results-oriented projects such as energy-efficient lighting, heating and cooling upgrades, smart meters, and emissions-reducing equipment.

A New One-Stop-Shop for SME Energy Financing

One of the cornerstones of the initiative is a new one-stop-shop that will serve as a central access point for all EIB Group financing options related to energy efficiency. By consolidating resources into a single, user-friendly entry point, the initiative aims to remove complexity and accelerate implementation.

The goal is to create a more seamless experience for SMEs, enabling them to access funding, technical guidance, and risk-sharing tools without navigating a maze of disconnected programs or intermediaries. The EIB’s lending offering will be fully integrated within this platform, reducing administrative burden and helping businesses take swift action.

Explore OneStop ESG Marketplace: Renewable Energy

Aligning Public and Private Efforts for Climate Goals

In tandem with the financing program, the European Commission is also launching a new working group under the European Energy Efficiency Financing Coalition. This group will focus on breaking down persistent barriers and designing innovative financing solutions that meet the specific needs of small businesses.

EIB President Nadia Calviño called the initiative a timely and significant advancement in Europe’s green transition. She underlined that supporting SMEs in cutting energy costs is not only a climate imperative but also a competitiveness issue, as energy-efficient companies are better positioned to thrive in a low-carbon economy.

A Strategic Step in the EU’s Climate and Economic Agenda

This move comes as Europe continues to prioritize its twin goals of climate resilience and economic competitiveness. With energy prices remaining volatile and pressure mounting to meet 2030 and 2050 decarbonization targets, enabling SMEs to modernize their energy infrastructure is increasingly seen as a strategic necessity.

The new initiative reflects a growing recognition that climate action and economic opportunity go hand in hand. As the EU prepares to implement its broader Green Deal objectives, investments like these are expected to play a central role in both driving emissions reductions and supporting sustainable growth for Europe’s 23 million small businesses.

Explore ESG Solutions on our marketplace - OneStop ESG Marketplace.

Keep abreast of the top ESG Events on OneStop ESG Events.

OneStop ESG Educate: Your go-to source for top ESG courses and training programs tailored to your needs.

Stay informed with the latest insights on OneStop ESG News.

Discover meaningful career opportunities on OneStop ESG Jobs.