How England’s First Net Zero Whisky Distillery and Peak District Eco-Tourism Lead the UK’s Top Small Businesses for Green Growth

UK SMEs Leading the Charge on Green Growth

Sustainability is no longer a peripheral concern for UK businesses; it’s increasingly becoming a central pillar of strategy and operations, particularly for Small and Medium-sized Enterprises (SMEs). Against the backdrop of national commitments like the Net Zero by 2050 target, SMEs, which constitute over 99% of the UK business population and are estimated to account for around half of all business emissions, play a pivotal role in the transition to a greener economy. More than just an environmental obligation, embracing sustainability is proving to be a powerful driver of business success, fostering innovation, enhancing reputation, potentially reducing costs, and building resilience for the future.

Across the UK, numerous SMEs are demonstrating that green practices and commercial success can go hand-in-hand. Initiatives like the ‘Green Growth Awards’, launched by Small Business Britain and BT, celebrate these pioneers, showcasing entrepreneurs who are leading the way in sustainable growth. Among the standout examples are Cooper King Distillery in York and Hoe Grange Holidays in the Peak District. These award-winning businesses illustrate how innovative green strategies can benefit both the planet and the bottom line. This report explores their journeys, the broader challenges and opportunities for SMEs pursuing sustainability, and the support available to help businesses navigate this transition.

Case Study: Cooper King Distillery – Distilling a Net-Zero Future

Nestled in Yorkshire, Cooper King Distillery, founded in 2016 by Abbie and Chris Jaume, embodies a commitment to producing sustainable spirits guided by “craftsmanship, honesty and adventure”. Their most notable achievement is the creation of England’s first single malt whisky distilled using net-zero energy – a milestone reached 27 years ahead of the UK government’s 2050 target. This accomplishment stems from years of dedication to reducing their environmental footprint through innovative practices. It is worth noting the distinction: while Scotland’s Nc’nean became the UK’s first *distillery* certified net-zero for production emissions in 2021, Cooper King specifically achieved net-zero *energy* status for its *English* whisky distillation, verified in late 2023/early 2024.

Key Sustainable Practices:

• Renewable Energy & Efficiency: Since firing up their stills in 2018, Cooper King has run entirely on 100% renewable energy. However, their approach goes beyond simply sourcing green power. They actively seek to minimise consumption first. A prime example is the application of a pioneering insulating paint, originally developed for NASA space rockets, to their custom-built copper pot still. This paint, filled with ceramic micro-beads, creates a highly effective thermal barrier just 3mm thick, reducing the energy required for distillation by a significant 21%. Furthermore, they implemented a clever water recycling system. Water used to cool the still’s condenser exits at around 60°C; this warm water is captured and used via a heat exchanger to pre-heat the cold wash (the fermented liquid) entering the still for the next run, saving both energy and water.
• Carbon Footprint Calculation & Offsetting: Cooper King undertook a rigorous assessment of their Scope 1 (direct) and Scope 2 (indirect energy) emissions from distilling operations, conducted by environmental consultants. This revealed a remarkably low footprint of just 0.6 tonnes of CO2 equivalent (CO2e) since 2018. To address these residual emissions and ensure a robust net-zero claim, they adopted a “belt and braces” approach, removing three times their calculated emissions (including a forecast for the next year) through a diversified strategy. This involved contracting Climeworks for Direct Air Capture (removing 1 tonne of CO2 directly from the atmosphere), planting native UK woodland with charity partner Yorkshire Dales Millennium Trust (estimated to sequester 1 tonne CO2 over 50 years), and investing in a Verified Carbon Standard overseas tree planting project in Uruguay (removing a further verified 1 tonne CO2).
• Sustainable Packaging & Production: The commitment extends to the final product. Their whisky is bottled in lightweight containers made from 55% recycled glass. They utilise biodegradable cellulose tampers, innovative stoppers derived from renewable sugarcane, and labels printed on FSC-certified paper. Alongside their net-zero energy whisky, the distillery also produces carbon-negative gins and has pioneered a gin refill scheme, with plans potentially using their award prize money to launch letterbox-friendly refill pouches to further reduce waste and enhance customer convenience.
• Wider Environmental & Social Commitment: Cooper King’s sustainability ethos permeates their entire business model. They donate £5 from every whisky bottle sold to the Yorkshire Dales Millennium Trust (YDMT), specifically funding life-changing apprenticeships for young people in rural areas. These apprentices undertake vital habitat protection work, including restoring Yorkshire peatlands which are crucial carbon sinks. Their goal is to fund at least one full apprenticeship (£17,000) annually through these sales. This is complemented by planting 35,000 sqm of woodland linked to sales and donating over 2.5% of total revenue to environmental causes. They cemented this commitment by becoming the first distillery in Europe to join the ‘1% for the Planet’ initiative and are also an accredited Living Wage Employer, demonstrating a focus on people and planet alongside prosperity.

The Cooper King story highlights that genuine green leadership often involves a holistic view, integrating environmental action across energy use, waste reduction, biodiversity support, and social responsibility. Their journey wasn’t just about switching energy sources but required actively seeking and implementing innovative solutions, like the NASA-derived paint and the combined offsetting strategy, demonstrating that achieving ambitious green targets may necessitate looking beyond standard practices and embracing new technologies and approaches.

Case Study: Hoe Grange Holidays – Peak District Eco-Tourism Pioneer

Hoe Grange Holidays, established in 2006 by David and Felicity Brown as a diversification of their family farm in the scenic Peak District, exemplifies how tourism businesses can thrive while championing environmental stewardship. Recognised alongside Cooper King Distillery at the Green Growth Awards, Hoe Grange is setting a high standard for eco-friendly tourism in the UK, offering accessible log cabin and glamping holidays with sustainability at their core.

Key Sustainable Practices:

• Renewable Energy Powerhouse: A cornerstone of Hoe Grange’s eco-credentials is its commitment to renewable energy. All guest accommodation, including log cabins and glamping pods, is 100% powered by on-site renewables, specifically wind turbines and solar panels. This green energy fuels efficient heating systems like heat pumps and infrared panels, ensuring guest comfort year-round. Crucially, they installed a battery storage system in 2024 to capture surplus generated electricity for use during nighttime or less sunny/windy periods, maximising self-sufficiency. Their £5,000 award prize is earmarked for expanding this battery capacity and enabling smart EV charging.
• Reducing Carbon Footprint & Costs: The investment in renewables and efficiency has yielded impressive results. Hoe Grange reported a 77% reduction in their carbon footprint over the three years leading up to their award win. This transition has also led to significant energy cost savings. Demonstrating a virtuous cycle, these savings were directly reinvested into further green technology, namely the initial battery storage system. Their ambition extends further, with a target to achieve Net Zero status by 2030.
• Broader Eco-Conscious Operations: Beyond energy, Hoe Grange integrates sustainability across its operations. They provide free Electric Vehicle (EV) charging points for guests, encouraging greener travel. As a working farm, they actively promote biodiversity and share their passion for sustainable farming practices with visitors. The business also emphasizes accessibility and inclusion in its offerings and actively supports other local sustainable businesses, fostering a greener local economy. Community engagement is also a key part of their ethos.

Hoe Grange Holidays powerfully demonstrates the financial viability of deep green investments. By generating their own power and reinvesting the savings, they’ve created a model where sustainability directly enhances profitability and resilience, particularly against volatile energy prices. This provides a compelling case study for other SMEs hesitant about the upfront costs of green technology. Furthermore, their success underscores the growing market for eco-conscious tourism. By authentically embedding sustainability into their brand and operations, they attract guests who specifically value these principles, confirming that aligning with customer values can be a potent market strategy.

The Green Imperative for Small Businesses

The drive for SMEs to adopt greener practices stems from a confluence of factors, blending ethical motivations with pragmatic business considerations. Many business owners are personally motivated by a desire to combat climate change and “do the right thing” for the planet. Simultaneously, external pressures are mounting. Customers are increasingly aware and demanding of sustainable options, with surveys indicating a majority of consumers prioritise sustainability in purchasing decisions. Supply chains, particularly those involving larger corporations, are also setting stricter environmental standards for their SME partners.

Beyond compliance and ethics, sustainability presents tangible business opportunities. Around one in four SMEs now view ‘going green’ as a pathway to growth. This can manifest through enhanced brand reputation, which helps attract not only customers but also talent and investment. Implementing sustainable practices can build resilience against future regulations and the physical impacts of climate change. Furthermore, efficiency gains from greener operations – such as reduced energy consumption through LED lighting (potentially cutting lighting bills by 40%) or lower running costs for electric vehicles (around 40% less than petrol/diesel) – can lead to significant long-term cost savings. This combination of intrinsic values and extrinsic value creation means sustainability is shifting from a niche concern to a strategic imperative for many UK SMEs.

Navigating the Hurdles to Sustainability

Despite a strong desire among UK SMEs to improve their environmental performance – with 80% wanting to enhance sustainability – significant obstacles often impede progress. While a large majority (77%) report taking some steps, only 20% feel their actions have been significant, highlighting a considerable gap between ambition and implementation. Understanding these hurdles is crucial for designing effective support mechanisms.

Key Challenges:

• Financial Constraints: Cost consistently emerges as a primary barrier. Between 35% and 41% of SMEs identify finance as a major obstacle to taking green action. Compounding this is the difficulty in accessing funding specifically earmarked for sustainability projects; research indicates only 11% of smaller businesses have successfully accessed finance to support net-zero transitions. This financial pressure is exacerbated by the broader economic climate, including the cost-of-living crisis and recessionary pressures, which restricts investment capacity. Consequently, there’s a strong demand for more grant funding, with 65% of SMEs expressing this need. Smaller businesses, in particular, may be more hesitant to seek finance during uncertain economic times due to concerns about repayment.
• Lack of Clear Guidance and Support: Many SMEs struggle with knowing how or where to begin their sustainability journey. Business leaders report a lack of clear, actionable guidance and find the sheer volume of advice sources overwhelming, making it difficult to identify trustworthy information. This is reflected in the finding that nearly two-thirds (64%) of SMEs desire greater support, and very few (under 2%) feel that significant sustainability resources are readily available to them. This points to a need for stronger leadership and more coordinated support from both government and the private sector to clarify the path forward.
• Time and Expertise Constraints: Implementing and managing sustainability initiatives requires ongoing attention, which can be complex and time-consuming for SMEs often operating with limited resources. Many businesses lack dedicated in-house expertise or formal training in sustainability practices. As a result, a significant number seek external partners, advisors, or insights from organisations like Small Business Britain to guide their efforts.

There appears to be a significant disconnect between the high level of awareness and desire among SMEs to engage in sustainable practices and their practical ability to access the necessary information, support, and, critically, finance to implement meaningful changes. While awareness of national goals like Net Zero exists, the pathway for individual businesses is often unclear or perceived as too costly. Initiatives aimed at bridging this gap must therefore be practical, easily accessible, reliable, and directly address the financial barriers currently hindering progress.

Finding Support for Green Ambitions

While challenges exist, a growing ecosystem of support is available for SMEs looking to embark on or accelerate their sustainability journey. Navigating these resources effectively is key to turning green intentions into tangible actions. Businesses need to proactively seek out the help that aligns with their specific needs and circumstances.

Avenues for Support:

• Government Initiatives & Advice: The UK government has launched the UK Business Climate Hub, intended as a central resource or “one-stop-shop”. This platform offers advice on various green measures (EVs, heat pumps, solar), tools like a free carbon calculator, and guidance on measuring and reporting emissions. General government resources, such as the Business Finance Support Finder and specific grant search services, can also uncover funding opportunities, including those targeted at green investments like EV chargepoints or woodland creation. Additionally, local authorities and Local Growth Hubs may offer tailored regional support or grants, sometimes linked to broader economic development or net-zero strategies.
• Financial Institutions & Green Finance: Recognizing the need and opportunity, many banks now offer dedicated green finance products. Examples include Lloyds Bank’s Clean Growth Financing Initiative, Barclays’ Sustainable Green Solutions, HSBC UK’s Green SME Fund, NatWest’s Green Loans, The Co-operative Bank’s Renewable Energy Funding Scheme, Royal Bank of Scotland’s Green Loans, the Development Bank of Wales’ Green Business Loan Scheme (which includes consultancy), and Bank of Ireland’s Green Business Loans. These often provide discounted lending or specific terms for investments in renewable energy, energy efficiency, or low-carbon transport. Beyond these specific products, standard business finance options like asset finance are frequently used to fund green capital expenditures.
• Training, Mentoring & Community Resources: Partnerships like the one between Small Business Britain and BT offer valuable non-financial support, including free training programs such as ‘Sustainability for Small Business’, covering key topics like measurement, accreditation, and financing options. Membership organisations like the Federation of Small Businesses (FSB) provide a wide range of general business support, including financial expertise and advocacy, which can extend to sustainability challenges. Energy companies, such as SSE through its Community Funds, may also offer funding for relevant local projects. Engaging with sector-specific bodies or local business networks can also provide tailored advice and peer learning opportunities.

The very diversity of these support mechanisms – spanning national and local government, high street banks, challenger banks, membership bodies, and private initiatives – can itself be a challenge for SMEs. This potential fragmentation underscores the difficulty businesses report in finding clear, trustworthy guidance. Centralised resources like the UK Business Climate Hub aim to mitigate this, but SMEs still benefit from clear signposting to navigate the complex landscape and identify the most relevant and accessible support for their specific situation and location.

Business Finance Options for UK Businesses

Financing the transition to greener operations or investing in sustainable growth often necessitates external capital, linking directly back to the financial constraints highlighted as a major challenge for SMEs. The UK’s business finance market has evolved significantly, with a growing array of options beyond traditional bank loans. Navigating this landscape can be complex, which is where the expertise of a business finance broker can be invaluable.

Leveraging Broker Expertise:

• Access to a Wide Network: Specialist finance brokers maintain relationships with a large panel of lenders – often exceeding 95 different institutions, encompassing traditional banks, challenger banks, and alternative finance providers. This broad reach significantly increases a business’s chances of finding a lender willing to fund their specific project, including green initiatives, often securing more competitive rates and terms than if approaching lenders directly. Platforms like the FSB Funding Platform, powered by Capitalise, offer a similar aggregated approach.
• Tailored Solutions & Guidance: Brokers invest time to understand a business’s unique circumstances, objectives (such as sustainability goals), and financial health. They can then identify the most appropriate type of finance and match the business with lenders whose criteria align with the proposal. This personalised guidance extends through the application process, helping businesses present their case effectively.
• Efficiency and Convenience: Engaging a broker saves considerable time and effort compared to researching and applying to numerous lenders individually. Brokers streamline the application process, manage communication with lenders, and can often expedite approvals. Many brokers operate on a success-fee basis paid by the lender, meaning there is no direct cost to the business for their services.

Common Finance Products Available:

• Business Loans (Unsecured/Secured): The most conventional form of finance, involving a lump sum repaid over time with interest. Unsecured loans don’t require specific assets as collateral, relying more on the business’s trading history and creditworthiness, while secured loans are backed by assets like property or equipment. These loans offer versatility for funding investments like energy-efficient equipment, premises upgrades, or research into sustainable processes. Loan amounts and terms vary widely depending on the lender and business profile. They are a common vehicle for funding green projects like solar installations or fleet electrification.
• Merchant Cash Advance (MCA): This option provides funding based on anticipated future credit and debit card sales. Repayment is flexible, automatically deducted as a pre-agreed percentage of daily card takings, making it suitable for businesses with seasonal or fluctuating revenue, common in retail and hospitality. While less directly used for large green capital projects, MCAs offer quick access to working capital that could support smaller operational adjustments or bridge funding gaps during a green transition.
• Invoice Finance (Factoring/Discounting): Businesses that issue invoices to customers (typically B2B) can unlock cash tied up in unpaid sales ledgers. Lenders advance a percentage (often up to 90%) of the invoice value almost immediately. Invoice Factoring usually includes the lender managing credit control, whereas Invoice Discounting is typically confidential, with the business retaining control of collections. This improves immediate cash flow, which can then be allocated towards sustainability investments or cover operational costs during periods of green project implementation.
• Asset Finance (Leasing/Hire Purchase): Specifically designed for acquiring tangible assets – vehicles, machinery, equipment. Hire Purchase agreements typically lead to ownership at the end of the term, while Leasing is essentially a long-term rental. The asset being financed often serves as security for the lender. This is an ideal structure for funding specific green assets such as solar panels, wind turbines, biomass boilers, energy-efficient manufacturing equipment, or electric vehicles, allowing businesses to spread the cost over the asset’s useful life. Dedicated ‘Green Finance’ often utilises this structure, sometimes offering preferential terms.
• Bridging Loans: These are short-term funding solutions intended to cover a financial gap until longer-term finance is secured or an anticipated inflow of cash arrives (e.g., from selling an asset). While often associated with property, they can provide rapid access to capital for urgent needs or time-sensitive opportunities. In a green context, a bridging loan might cover initial deposits for large renewable energy projects or fund preparatory work while awaiting confirmation of a grant or a longer-term green loan.

The expansion of these diverse financing options, facilitated by brokers and the rise of alternative lenders (including fintech platforms and challenger banks), signifies a crucial shift in the SME funding landscape. This evolution, partly driven by a pullback from traditional banks post-financial crisis and actively supported by initiatives like the British Business Bank, provides SMEs with more avenues to secure funding. This diversified market may be particularly beneficial for businesses seeking finance for innovative or less conventional green projects that might not fit traditional lending criteria, offering greater flexibility and potentially faster access to the capital needed to pursue sustainability goals.

Conclusion: The Future is Green for UK SMEs

The journey towards sustainability is becoming increasingly central to the identity and success of UK small businesses. As exemplified by the pioneering efforts of Cooper King Distillery and Hoe Grange Holidays, integrating green practices is not merely an environmental responsibility but a strategic move that can unlock cost savings, drive innovation, enhance brand reputation, and build long-term resilience. These businesses demonstrate that ambition, coupled with innovative thinking and a commitment to holistic sustainability, can lead to significant achievements, even surpassing national targets.

While the path presents challenges, particularly around securing finance and navigating the complex web of available guidance, support structures are evolving. Government initiatives, dedicated green finance products from banks, and support from business organisations offer resources to help SMEs overcome these hurdles. Furthermore, the changing finance landscape, with the rise of alternative lenders and the valuable role of finance brokers in accessing diverse funding options, provides new avenues for securing the capital needed for green investments. For UK SMEs, embracing sustainability is increasingly looking less like an optional extra and more like a fundamental component of future-proofing their business and contributing to a more prosperous, resilient, and greener economy.

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