Sustainability business loans — finance refrigeration & chiller systems

Short answer: Yes — SMEs can finance refrigeration and chiller upgrades to reduce energy bills and carbon emissions. Options include asset finance, green loans, energy performance contracting, and grants. Start a Free Eligibility Check to see which lenders or brokers are best suited to your business: Get Quote Now (Takes 2 minutes — no impact on credit score).

Why refrigeration & chillers matter for SMEs

Refrigeration and chiller systems are often one of the largest energy consumers in businesses that rely on cold storage — supermarkets, convenience stores, restaurants, pubs, food producers, laboratories and healthcare suppliers. Older or inefficient units can drive energy bills, raise maintenance costs and create stock-loss risk.

Upgrading to modern, energy‑efficient chillers can typically reduce energy use by 20–40% depending on equipment age, controls and insulation. For many SMEs that translates to thousands of pounds of annual savings and a reduced carbon footprint — benefits that can justify financed investment.

Can SMEs get finance for refrigeration/chiller upgrades?

Short answer: Yes. SMEs commonly secure funding for refrigeration and chiller projects via multiple routes. Typical options include:

• Asset finance (hire purchase, leasing)
• Commercial term loans / business loans
• Green loans or sustainability-linked loans
• Energy Performance Contracting (third‑party financing tied to energy savings)
• Government grants and public funding (e.g., Salix or local schemes)
• Supplier / manufacturer finance

Each route suits different project sizes (£10,000+ are typical for equipment finance) and cashflow preferences. To begin, get a Free Eligibility Check from specialist lenders and brokers: Free Eligibility Check.

Financing options — pros, cons & suitability

Asset finance (hire purchase, lease)

What it is: Lenders fund the equipment; you pay monthly over an agreed term. At the end you may own the asset (hire purchase) or return it (leasing).

Typical term/size: 2–7 years; well-suited to £10k upwards.

Best for: Businesses that want to spread cost while preserving cashflow and often benefit from tax allowances.

Pros: Quick decisions, finance secured against asset, can preserve working capital. Cons: Interest and fees vary; ownership terms differ by product.

Green / sustainability loans

What it is: Loans or facilities marketed for environmentally beneficial projects; some offer better rates or flexibility for verified green upgrades.

Best for: Projects with measurable energy savings and documentation (energy audit, quotes).

Pros: Lenders may value lower risk from energy savings; may access sustainability specialists. Cons: May require additional paperwork to demonstrate savings.

Commercial loans & overdrafts

What it is: Standard business loans or overdrafts for capital expenditure.

Best for: SMEs with strong credit and a need for more flexible use of funds beyond equipment purchase.

Pros: Simplicity. Cons: Possibly higher rates for unsecured borrowing; overdrafts are short-term.

Energy Performance Contracting (EPC) / third-party financing

What it is: A contractor installs and finances the upgrade; repayment is funded from a share of the realised energy savings.

Best for: Businesses wanting a low‑risk, outcomes-based approach with performance guarantees.

Pros: Low upfront cost, contractor takes performance risk. Cons: Contract complexity and long-term commitments.

Grants & incentives

What it is: Public funding schemes or grants (for example public-sector Salix funding) and local energy grants can reduce capital cost.

Best for: Eligible organisations and projects meeting scheme rules. Check Salix Finance and gov.uk guidance for eligibility.

Pros: Non-repayable funding reduces project capital. Cons: Competitive, often targeted (public sector / certain SMEs), paperwork and timelines.

Supplier / manufacturer finance

What it is: Manufacturers or dealers offer in-house finance or partner with funders to spread payments.

Best for: When you want bundled procurement and installation with finance in one package.

Pros: Convenient procurement, potentially competitive offers. Cons: May be limited choice of lender or terms; compare independently.

How to evaluate the business case — ROI & payback example

Simple worked example (typical SME grocery/convenience store):

• Capital cost (new chiller + installation): £25,000
• Expected energy savings: 30% on refrigeration energy → annual saving approx. £4,500
• Maintenance savings & reduced downtime: £600/year
• Total annual benefit: £5,100
• Finance: 5‑year asset finance (example rate may vary) — annual repayment approx. £5,850

Interpretation: With full finance and no deposit, repayments could slightly exceed first‑year savings, but net cashflow typically improves after tax relief and energy savings rise. Add a 10% deposit, and payback reduces to under 5 years. Exact outcomes vary; get tailored quotes to model your numbers.

Eligibility & what lenders check

Common lender checks and requirements:

• Business age and turnover — lenders typically prefer established SMEs with verifiable trading history.
• Management/director credit profiles — depending on product, personal guarantees may be required.
• Two to three years’ accounts or management accounts for smaller businesses.
• Bank statements, VAT returns and company registration where applicable.
• Equipment quotes, supplier credentials and energy audit or projected savings.

Documents to prepare: recent accounts, business bank statements, supplier quote(s), equipment spec sheets and any energy audit or EPC. Start by submitting a Free Eligibility Check to see which lenders match your profile: Get Quote Now.

Practical steps to secure finance

1. Arrange 2–3 competitive quotes from reputable refrigeration suppliers and ask for full specs and disposal costs for old units (F‑gas handling).
2. Obtain an energy audit or simple ROI projection to demonstrate savings to lenders.
3. Decide your finance preference (asset finance, green loan, EPC, grant top‑up).
4. Complete a quick enquiry for a Free Eligibility Check so we can match you to specialist lenders/brokers: Free Eligibility Check.
5. Review offers, ask lenders for total cost of credit and repayment schedules, then appoint installer once finance is accepted.

Tips to improve approval: provide clear cashflow forecasts, offer a deposit, or select an asset-backed facility and extend the term to lower monthly payments.

Risks, compliance & regulatory considerations

Finance costs and approvals vary — always check full terms and T&Cs. Equipment installs have compliance obligations: F‑gas regulations for refrigerant handling and disposal, installer certifications (e.g., REFCOM/F‑gas qualified engineers), and relevant building works approvals. Factor disposal and commissioning into project quotes.

Important: UK Business Loans is an introducer and does not lend or provide regulated financial advice. We connect you with lenders and brokers who will provide offers under their terms; eligibility checks and credit searches may apply.

How UK Business Loans helps

UK Business Loans connects SMEs to lenders and brokers that specialise in sustainability and equipment finance. Our process is quick and free:

• Complete a short enquiry (takes ~2 minutes).
• We match you with lenders/brokers experienced in refrigeration/chiller projects.
• Receive no‑obligation quotes and guidance; compare offers and choose the best fit.

We typically handle enquiries for funding of £10,000 and above. Start your Free Eligibility Check now: Get Quote Now (no obligation, no immediate credit check).

Case study (example)

Example: A neighbourhood convenience store replaced two 12‑year‑old chillers for £28,000 using asset finance. Projected savings were £5,400/year. With a 10% deposit and a 5‑year term, the owner reported reduced energy bills, quieter operation and lower maintenance — estimated payback under 5 years and improved daily cashflow from lower utility spend.

FAQs

Final CTA & next steps

If you’re considering replacing or upgrading refrigeration/chiller systems, the quickest way to find appropriate finance is to get matched with specialist brokers and lenders. Complete a short enquiry now for a Free Eligibility Check and tailored quotes: Get Quote Now — takes 2 minutes, no obligation.

Related links

• Salix Finance
• Energy Saving Trust
• Gov.uk — Business energy efficiency
• REFCOM — refrigerant handling guidance
• sustainability business loans
• Asset finance
• Get a Free Eligibility Check

Important: UK Business Loans introduces businesses to lenders and brokers; we do not lend money or provide regulated financial advice. We will share your enquiry with selected partners to obtain quotes — offers, terms and credit checks are provided by those lenders. We only handle enquiries for funding of approximately £10,000 and upwards. See our Privacy Policy for details on how we handle your data.

1. Can SMEs get finance to replace or upgrade commercial refrigeration and chiller systems? — Yes — UK SMEs can access asset finance, green loans, EPC arrangements, supplier finance or grants to fund refrigeration and chiller upgrades.
2. Which finance option is best for refrigeration upgrades (asset finance, green loans or grants)? — Asset finance is common for £10,000+ equipment purchases while green/sustainability loans or grants suit projects with verified energy savings and EPCs.
3. What size of project do lenders typically fund for refrigeration and chiller upgrades? — Most lenders and brokers handle projects from around £10,000 upwards, with many typical chiller replacements costing £20k–£30k or more.
4. Will submitting a Free Eligibility Check with UK Business Loans affect our business credit score? — No — the enquiry is not a credit application and won’t affect your credit score, though individual lenders may perform checks if you proceed.
5. How long does it usually take to get finance approval for a chiller or refrigeration project? — Preliminary eligibility feedback can come within hours to days, with full lender approval commonly taking 1–3 weeks depending on documentation.
6. Do I need an energy audit, EPC or projected savings to qualify for a green loan or grant? — Some lenders and grant schemes do require an energy audit or evidence of projected savings, and providing one can improve your chances and terms.
7. Are there grants or public incentives available for energy‑efficient refrigeration in the UK? — Yes — schemes such as Salix and local energy grant programmes can fund eligible projects, but availability depends on sector and location.
8. What documents do lenders typically request for refrigeration equipment finance? — Lenders usually ask for recent accounts or management accounts, bank statements, company registration, supplier quotes/specs and any energy audit or savings projections.
9. Do I need to factor in refrigerant disposal and F‑gas regulations when budgeting for a chiller upgrade? — Yes — old units often contain regulated F‑gases and must be decommissioned and disposed of by REFCOM/F‑gas certified engineers at an added cost.
10. How does UK Business Loans help me secure the best finance for refrigeration upgrades? — We’re a free introducer that matches your short enquiry with trusted UK lenders and brokers who specialise in sustainability and equipment finance so you can compare tailored offers (we do not lend or give regulated advice).