Small and medium-size businesses that have been overwhelmed by recent energy bill rises will get some relief from the Federal Government’s Small Business Energy Incentive.

Business NSW has welcomed Treasurer Jim Chalmers’ announcement that almost all of NSW’s 840,000-plus small and medium businesses could be eligible for up to $20,000 in tax relief under a scheme to be introduced in the upcoming Federal Budget.

The scheme benefits enterprises with a turnover up to $50 million, allowing them to claim deductions on up to $100,000 in spending for the installation of more energy efficient fridges and induction (electrified) cooktops.

The incentive, for the next financial year, also applies to the installation of batteries and heat pumps and will be on top of the regular depreciation deduction of business equipment.

Business NSW CEO Daniel Hunter said the changes will offer some relief to small and medium business owners who have been left without proper assistance on how to reduce their energy usage and costs.

“The Federal Government’s Small Business Energy Incentive will go some way to helping businesses reduce their energy costs – especially when you consider all the other cost pressures enterprises face,” Mr Hunter said.

“Switching from gas to electrical power and heat can be complex for a business to implement. 

“Providing advice alongside this incentive would help ensure that the program is effective and reaches the goals the government has for it.

“Small businesses want to support the transition to Net Zero, but often don’t know where to begin or who to turn to for help.”

Business NSW’s Unfinished Business energy report, released in December 2022, revealed an appetite among business to move more quickly to reduce their emissions. 

However, 51 per cent of businesses owners who have set a target of reaching Net Zero by a specific date said they have no awareness of the implications of Net Zero or do not understand how their business specifically will be affected.

"We have seen in the past that complicated administration processes put businesses off accessing government support," Mr Hunter said.

"As we approach the Federal Budget on May 9 we hope the government continues to bear this in mind as it decides how else to focus on small and medium businesses.

“Many businesses have seen their gas and electricity bills double, so any help in helping them reduce their costs is welcomed.”