There are too many barriers to improving energy efficiency in businesses and smaller companies are less likely to take part in energy efficiency measures, because they lack the time and skills to support them, says an EEF Northern report.

Barriers included the cost of investing in energy efficiency outweighing the benefits to businesses. Hidden costs, such as the need to pay specialists, auditing requirements and the impact of energy systems, put off businesses that would otherwise be keen to invest in energy efficiency.

There is also a lack of skills, especially in smaller companies, to assess the costs and benefits of energy efficiency measures.

The report says only 22% of companies with less than 50 workers are investing in energy efficiency, compared with 48% of organisations with 500 or more employees.

EEF Northern says the government must provide support to companies of all sizes; there should be improved financial incentives and the Carbon Trust should customize its support for the needs of different companies.