The UK’s built environment is responsible for approximately 25% of the nation’s total greenhouse gas emissions. With a commitment to achieve net zero emissions by 2050 and a pledge made at COP26 to slash carbon emissions by 68% by 2030, the construction industry faces urgent pressure to transform.

Asset Finance, including Finance Lease and Hire Purchase, has emerged as a vital enabler for the construction sector in driving sustainability. A recent study commissioned by ERA highlights the potential of rented or hired equipment in drastically reducing carbon emissions, with potential cuts ranging from 30% to an impressive 50%. This approach leads to the appropriate use of tools for specific tasks over their useful working life, minimising travel distances, and ensuring regular maintenance.

Increasing Sustainability Through Technology

Sustainability in construction equipment management has become a priority, with a focus on greening the asset base. The transition to electric-powered construction equipment represents a significant innovation, offering quiet and emissions-free operation, ideal for indoor and urban projects. Renewable fuel-powered equipment, such as those using biofuels or hydrogen fuel cells, provide alternatives to traditional fossil fuels, significantly reducing greenhouse gas emissions.

Driving Sustainability in Construction Finance

Asset Finance is a powerful funding tool giving construction companies the ability to prosper in a challenging environment - and Propel is here to help business in the sector unlock its full potential.

Propel, the fastest-growing asset finance provider in the UK, champions sustainability in construction by supporting businesses in acquiring eco-friendly machinery and equipment. Through tailored financing solutions, Propel enables companies to invest in sustainable technologies, while realising economic benefits and environmental gains.

Propel delivers asset finance deal, championing sustainability

Recently, Propel helped a North-East headquartered recycling and construction support specialist by financing a new sustainable aggregate processing and washer plant.

The equipment purchase has benefitted the customer economically in terms of creating a substantial new income stream from the sale of washed aggregates and value-added bi-products; while it has also delivered considerable environmental benefits, transforming the sustainable working practices of businesses throughout the entire supply chain including landfill, tipping and road haulage.

Following an introduction from its strategic banking partner, Propel’s customer management and credit teams met with the customer, a privately-owned SME business with annual turnover of £4m, and their multi-national supplier on-site. This discussion enabled the team to gain a deep understanding of the customer’s medium to long-term investment plans and strategy, the commercialisation of the assets, and the lengthy and complex commissioning cycle for the equipment - which covered substantial acreage.

Propel structured and delivered a comprehensive asset finance package to enable the customer to purchase the end-to-end processing plant comprising a control room, buffer tank, washer plant, filter press, feed conveyors and several additional items of processing equipment.

The plant has been running for nine months, processing thousands of tonnes of cost-efficient, recyclable sand and aggregate, reducing power consumption and landfill requirements, and recycling up to 90% of the water back into the washing process.

Commenting on the facility, Julie Warren, Marketing and Partnerships Director at Propel, said: “We were thrilled to be able to help our client fulfil their ESG aspirations from the germ of an idea to realising its potential. We have delivered a deal that many traditional lenders would have been unable to write. There were so many layers of complexity, from stage payments to the size of the deal, the high level of interaction with the supplier and the protracted commissioning period.

“At Propel, we are absolutely committed to implementing our ESG policy on a macro-level, not only within our business but also in respect of the impact of the technologies we finance. We aim to have a positive impact on the environment by helping businesses to power productivity and performance, while benefitting the planet.”

Propel strongly supports the Finance & Leasing Association’s (FLA) Building on Net Zero Plan, which sets out a clear and consistent approach to green finance, including the introduction of a ‘Green Finance Guarantee’ (GFG) and further support for net zero commercial vehicles and plant & machinery (electric, hydrogen and other forms of alternative fuel).