Across Britain’s industrial heartlands, a quiet revolution is underway. According to a major new report from Make UK titled “Manufacturing a Sustainable Future – Capitalising on Green Technologies,” more than 8 out of 10 manufacturers plan to include a “green growth” strategy in their business plans over the next five years.
This surge in optimism comes at a time when net-zero ambitions globally are being debated, but UK industry appears undeterred. Almost half of the respondents to the survey identified renewable energy as their top priority, followed by investment in greener supply chain materials and digitalisation to drive energy efficiency and waste reduction.
“Manufacturers are clearly committed to investing in green technologies to make their operations more efficient by reducing costs and cutting emissions,” says Verity Davidge, the director of policy at Make UK. But she cautions that incentives still don’t align fully.
The Roadblocks to Green Industry
However, the enthusiasm comes with caveats. Several structural impediments are compromising the pace and scale of investment:
- Business rates penalisation: Ironically, many manufacturers note that installing solar panels, low-carbon heating systems, or other energy improvements can raise their factory’s rateable value, thus increasing their tax burden. About 44 % of companies point to this as a stronger deterrent than even high energy costs.
- Uncompetitive energy pricing: Industrial energy in the UK remains notoriously expensive. The report notes that British manufacturers pay roughly four times more than their U.S. counterparts, nearly two-thirds more than in France, and about 25 % more than in Germany.
- Delay of incentives and uncertainty: While the government has proposed the British Industrial Competitiveness Scheme (BICs) to ease the burden on energy-intensive sectors, it won’t be enacted until 2027. Some manufacturers doubt its long-term viability.
- Policy ambiguity and incentive alignment gaps: Many firms express concern over inconsistent incentives, shifting regulations, and unclear policy frameworks — especially in areas like rate relief, R&D credits, and capital allowances.
Without concrete reform, these barriers risk throttling what could otherwise be a wave of green industrial modernization.
A Green Future Is Still Within Reach
Despite the challenges, the report outlines a pathway forward — and it begins with policy reform:
- Exempt green investments from business rates
Extending relief periods from the current 12 months to at least three years, or aligning them with net-zero timelines, could remove a major deterrent. - Expand R&D tax relief
Incentivising capital spending on decarbonisation, automation, and industrial modernisation would encourage firms to adopt next-gen tech. - Stable, long-term regulatory frameworks
Certainty, transparency, and consistency in green policy will help manufacturers commit to multi-year strategies. - Support for skills and training
Updating apprenticeships and workforce development to reflect green technology needs will ensure that technology adoption isn’t hampered by talent shortages.
If acted upon, such reforms could catalyse a green investment surge — making UK manufacturing more efficient, competitive, and sustainable.