Small business guide to increasing energy efficiency and reducing waste

young man smiling at laptop in an office filled with sunlight and green potted plants

Erin Delahunty

Posted August 30, 2023

Investing in energy efficiency and waste reduction can be a win-win for Australian small businesses. Here are some cost-effective ways for small businesses and sole traders to take the next step.

By implementing energy efficient and waste reduction practices, small businesses of all types and sizes can conserve resources and save on operating costs, while also helping to attract customers and clients who value social responsibility.

Being a responsible operator can also help a small business differentiate itself from competitors. From increasing recycling opportunities to installing energy-efficient appliances, there are lots of simple ways for small businesses to make an impact.  
Small businesses and sole traders investing in energy efficiency through solar panels, batteries, electric vehicles and other energy assets should consider if they have appropriate small business insurance coverage in place.

A person holding a cardboard food container filled with salad

Food industry businesses can swap polystyrene food containers. Photo: Matt Harvey.

How to make your small business more responsible

Reduce, reuse, recycle

The “reduce, reuse, recycle” mantra is just as applicable in a business as it is at home, offering myriad ways to eliminate wastage.

Whether it’s an office responsibly handling e-waste and separating different types of waste for collection, a café encouraging customers to bring their own reusable coffee cups and limiting the use of single-use plastics, or retailers encouraging conscious consumption and donating unused, good-condition stock to charities, there are countless ways to “reduce, reuse, recycle.”

Select energy-efficient appliances

No matter the type of business, heating, cooling and hot water are among the three biggest energy hogs, accounting for a high percentage of energy usage. This makes selecting efficient appliances paramount. 
Lights, computers, heaters, air conditioners, fridges, freezers, dishwashers and even coffee machines all significantly contribute to power usage, especially if they’re old and inefficient.

According to the Victorian Government, for every extra star on the label of an appliance or device, businesses can save around 25% in running costs. So, upgrading to more efficient appliances may be able to help reduce power bills.

man maintaining an air conditioner

Keep air conditioners well maintained and serviced for maximum efficiency. Image: Supplied.

Embrace LEDs for lighting

Lighting can account for anywhere between 18% and 40% of a commercial building’s electricity, so it’s one area where big savings can be made.

It means LED lights, which are far more energy efficient than other types of lightbulbs, are the best choice for businesses looking to reduce energy consumption.

LED – short for light-emitting diode – lights produce maximum light for minimal electricity, using up to 90% less electricity to produce the same amount of light as traditional incandescent bulbs, according to While typically the most expensive type of lightbulb to buy, they don’t have to be replaced for many years. RACV Trades can help with the installation of LED lighting in your small business.

Set a steady temperature

Just like at home, heating and cooling a small business, whether it’s a coffee shop or a warehouse, is one of the biggest contributors to the energy bill.

Each extra degree on a heater or cooler’s thermostat can increase energy use by up to 10%, according to, so it makes sense to set the temperature between 18°C and 20°C and not move it.

In hot weather, portable and ceiling fans can use only a fraction of the electricity of air conditioner systems to keep your shop or office cool.

Air conditioners and heating systems should be regularly serviced by a qualified professional to ensure they're running effectively.


hands holding an incandescent lightbulb (on left) and LED lightbulb (on right)

LED lightbulbs are much more energy efficient than other kinds of bulbs. Image: Getty

Ditch paperwork and go digital

Physical paperwork is the bane of a small business, producing lots of stress and unnecessary waste. Going digital is a simple way to cut down on piles of papers for both you and your customers.

Switching to digital might include sending customer invoices via email instead of snail mail, forwarding receipts electronically instead of handing them to customers in-store and requesting bank statements, bills and other documents be sent via email.

It's simple to archive electronic paperwork by having a dedicated folder on an email system or computer drive. Having an automatic backup system is also wise.

Switch to new types of packaging

Many single-use plastics, including straws, cutlery, plates, drink stirrers and polystyrene food and drink containers, are now banned in many states and territories, making the switch to new packaging a business imperative. But in other places it’s still a choice small businesses can make.

Luckily, there’s a plethora of items available to replace plastic, which never biodegrades. In the food service space, these include beeswax wraps, silicone food covers and lids, paper or washable metal straws, paper bags, recycled paper or bamboo plates, bamboo cutlery and paper cups.

When it comes to businesses which ship goods, plastic-free packaging options include recycled cardboard and paper, corrugated cardboard packaging and “peanuts”, recyclable adhesive shipping labels, biodegradable plastics, air pillows made from recycled material and ecological textiles.

For retail, eliminating plastic from stores, using cotton tote bags and finding ways to recycle old products and materials are just a few of the options available.


reusable products such as a canvas tote bag and wooden cutlery

There are plenty of ways for small businesses to reduce waste such as plastic. Image: Getty

Boost insulation and draught-proofing

Good quality insulation and cost-effective draught-proofing might seem like modest improvements but are among the most effective ways to save on heating and cooling in a business.

Ensuring there’s good quality insulation in the roof space at the very least will make a huge difference. Finding and stopping draughts which allow warm air out and force heating systems to work harder in winter can also stop money disappearing into thin air. Even a simple door snake is a great way to keep chilly air from creeping in under the door.


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The information provided is general advice only that does not take into account your personal circumstances. Before making any decisions, please consider your own circumstances and the Product Disclosure Statement and Target Market Determinations. For copies, visit As distributor, RACV Insurance Services Pty Ltd AFS Licence No. 230039 receives commission for each policy sold or renewed. Product(s) issued by Insurance Australia Ltd, ABN 11 000 016 722, AFS Licence No. 227681.