CONFESS – Clean Energy Verification and Validation for SMEs

Small and medium-sized enterprises (SMEs) often face challenges with the administrative burden and complexity of understanding the EU taxonomy. They frequently receive information requests from clients and banks about how their products or activities align with the taxonomy. This can be overwhelming and time-consuming. The CONFESS project aims to solve this problem by creating an easy-to-use data tool. This data tool will help clean energy SMEs report their sustainability efforts simply and effectively, making it easier for them to respond to data requests as well as access sustainable financing.

The EU taxonomy is a vital tool for defining sustainable economic activities, but it can be complex for SMEs to implement. By creating a straightforward verification and validation scheme, CONFESS helps SMEs navigate these requirements. This not only makes it easier for them to report their sustainability efforts but also enhances their credibility with investors and financial institutions. Ultimately, this initiative supports the growth of sustainable investments in the clean energy sector, contributing to a greener future.

CONFESS works directly with clean energy SMEs and financial institutions to develop and test a user-friendly verification and validation scheme. Here’s how we do it:

• Engagement: We talk to stakeholders to understand their specific needs and challenges with taxonomy reporting.
• Research: We study what financial institutions and SMEs require for effective sustainability disclosure.
• Methodology: We analyse the core activities of clean energy SMEs and simplify the EU Taxonomy criteria to make them feasible for SMEs.
• Online Data Tool: We develop a easy-to-use online data tool for SMEs to assess and verify their sustainability efforts.

What are the benefits of the verification and validation scheme?

For SMEs:

• Enhances credibility and visibility, making them more attractive to investors and financial institutions.
• Facilitates access to sustainable financing options, enabling SMEs to fund their clean energy initiatives and support their growth.
• Provides a competitive market advantage through recognized environmental sustainability assessment.

For financial institutions:

• Simplifies EU Taxonomy screenings, enhancing efficiency in evaluating the alignment of investments with the EU Taxonomy.
• Promotes informed decision-making, integrating sustainable investments into their portfolios.
• Establishes industry standards for taxonomy-enabled financing, fostering transparency and consistency.

The CONFESS project consortium partners are: RWTH Aachen University, the International Sustainable Finance Center (ISFC), the Czech Technical University in Prague (CVUT) and Circular S.R.L.

If you are a clean energy SMEs or financial institution in Germany, Czechia or Italy, and would like to help us to test out the tool whilst providing input, contact us today.