Demystifying SME energy behaviours: Insights on decision-making, priorities and risk appetite
This content is AI generated, click here to find out more about Transpose™.
For terms of use click here.
New research from 425 European SMEs reveals what drives energy decisions, what holds businesses back, and how providers can unlock adoption.
Small and medium-sized enterprises (SMEs) play a critical role in the energy transition, yet their behaviour remains poorly understood
The findings highlight a clear tension: SMEs are highly motivated to reduce costs and gain control over energy, but face significant barriers including upfront investment, limited internal resource, and uncertainty around returns.
This report provides actionable insight into SME decision-making, tariff preferences, and appetite for emerging models such as Energy-as-a-Service (EaaS) and third-party asset control. It offers a practical framework for solution providers looking to design propositions that resonate with SME priorities.
Access the full report, available to Spark subscribers
Sign in to access the full analysisExplore the full findings and identify where your proposition fits in the SME market.
About the research
The research explores how SMEs approach energy management, including decision-making structures, investment behaviour, and attitudes towards emerging energy propositions.
- Sample size: 425 SMEs across Europe
- Geography: United Kingdom, France, Germany and Italy
- Business size: Micro (<10 employees), Small (10–50), Medium (51–250)
- Timing: December 2025 – February 2026
- Methodology: Online quantitative survey, supported by qualitative interviews
- Respondents: Individuals with responsibility for, or influence over, energy decisions
Subscribe to our thinking
Get relevant insights, leading perspectives and event invitations delivered right to your inbox.
Get started to select your preferences.
What drives SMEs to act vs what holds them back?
Driving action (motivation)
Holding back (barrier)
-
95%monitor their energy consumption in some way, mainly to control or reduce energy costs and avoid unexpected bills
-
56%cite reducing energy costs and improving cost efficiency as a key motivation for investing in new energy equipment
-
44%cite upfront costs as a main barrier to investing in new energy assets
-
25%cite uncertainty around savings or payback periods as a main barrier to investing in new energy assets
While SMEs are strongly motivated to reduce energy costs and gain greater control over their bills, action is often constrained by internal capacity and uncertainty. Many businesses lack the time, expertise, or confidence to assess new technologies and build robust business cases, meaning investment decisions are delayed or deprioritised.
Are SMEs ready for innovative propositions?
The research finds that traditional propositions such as fixed tariffs remain the dominant choice for SMEs who are looking for lower energy costs and protection from price increases above all else. However, there are promising signs for cautious uptake of more advanced propositions to achieve these same goals.
74% of SMEs are willing to pass control of energy assets to a third party to help save money, cut emissions, and reduce strain on the grid. This number rises again once savings are guaranteed.
XaaS X-as-a-Service was found to be one of the most popular purchasing models for future energy equipment investments, resonating with SMEs’ desire for simplified energy management and reduced capital outlay.
SMEs are not inherently opposed to complex or advanced energy propositions. They are opposed to having to manage that complexity and risk themselves. If positioned as tools to lower/stabilise bills and reduce risk, without significant added operational complexity, propositions will go further to capture the attention of SMEs.
Gabrielle Heal C&I Strategy Service Manager, LCP Delta
What this means for solution providers
SMEs show readiness to invest in energy management solutions but to succeed in the SME market, energy propositions must:
- Reduce or remove upfront cost barriers
- Offer clear, short-term financial value
- Transfer risk away from the SME
- Simplify decision-making and operations
- Build trust through transparency and support
