Q:What payback periods do small and midsize businesses require to participate in programs?

A:Using data from the E Source Business Customer Insights Center, an interactive database of survey responses populated by E Source business customer surveys, we can estimate whether small and midsize businesses (SMBs) have specific payback timeline thresholds that energy-efficiency projects would have to meet to be approved. We can also suggest how far in advance SMBs plan for participating in an energy-efficiency project when a capital investment is required.

Do SMB customers have payback timeline thresholds that must be met to approve an energy-efficiency project? Some do, but the majority do not, according to the Business Customer Insights Center. In general, midsize businesses have payback timeline thresholds at higher rates than small businesses do.

What small business sectors are the most likely to have payback timeline thresholds? Small education, property management, restaurants, and industrial and manufacturing business customers report having specific payback timeline thresholds at a higher rate than the all-sector average, according to the Business Customer Insights Center. As such, we’d say these customers are the least likely of small business customers to have wiggle room regarding payback timelines. But it really depends on the specific customer, as a majority of respondents in each sector say they do not have specific timeline thresholds.

What midsize business sectors are the most likely to have payback timeline thresholds? Midsize industrial and manufacturing, property management, retail, office, and education customers report having specific payback timeline thresholds at a higher rate than the all-sector average, according to the Business Customer Insights Center. As such, we’d say these customers are the least likely of midsize business customers to have wiggle room regarding payback timelines. Again, it depends on the specific customer, as a majority of respondents in each sector say they do not have specific timeline thresholds.

In figure 1 we show how a variety of small business sectors responded to the question, “How far in advance do you plan for participating in an energy-efficiency project when a capital investment is required?” And in figure 2 we show the responses from a variety of midsize business sectors.

Figure 1: Small business timeline for capital investment in energy efficiency

“How far in advance do you plan for participating in an energy-efficiency project when a capital investment is required?”
Small business timeline for capital investment in energy efficiency

Small business timeline for capital investment in energy efficiency

Small business timeline for capital investment in energy efficiency

Figure 2: Midsize business timeline for capital investment in energy efficiency

“How far in advance do you plan for participating in an energy-efficiency project when a capital investment is required?”
Midsize business timeline for capital investment in energy efficiency

Midsize business timeline for capital investment in energy efficiency

Midsize business timeline for capital investment in energy efficiency

Contributing Authors

Associate Director, Customer Engagement Solutions

Luke Currin leads E Source’s Customer Engagement Solutions team, which covers marketing, communications, customer experience, and...