Making the sustainability case for refurbished tech

Most of us are only too aware that the climate crisis demands immediate and systematic changes. An increasingly important part of this transformation relates to how we manage and use technology. As businesses look to reduce their carbon footprint and take responsibility for the impact their use of technology is having, how government supports them becomes even more crucial.

Of course, even the most environmentally conscious businesses must overcome the significant financial barriers that inevitably come hand in hand with transitioning to sustainable infrastructure. Upgrading IT equipment comes at a price for all organisations, large or small – and more efficient technology usually comes at a premium. Many are looking to the government for support, hoping to relieve some of these pressures.

While tax incentives are available for new technology investment, and sustainability initiatives continue to take centre stage, joined up thinking is MIA when it comes to refurbished technology. In short, it has fallen through the cracks when it comes to government financial incentives. This is counter-intuitive, as refurbished tech is already helping businesses to pursue ambitious sustainability targets, without sacrificing quality, all while keeping costs at an affordable level.

Why refurbished is a strong asset in the drive to net zero

Refurbished technology means having your cake and eating it too. Businesses can invest in IT infrastructure to be more efficient without having to jeopardise their balance sheet in the process.

For companies with tight budgets, refurbished provides a viable option to enhance IT systems, allowing them to buy high-quality infrastructure, with stronger power and cooling credentials, at a fraction of the cost of buying new. Trusted providers guarantee that equipment has been tested and restored to prime working order, often with warranties comparable to new products. In turn, business leaders have peace of mind, knowing they’ve secured reliable equipment, while making significant savings.

What’s more, refurbished tech champions the country’s circular economy by promoting reuse and reducing waste. Many refurbished products are surplus stock or only a year or two old, saving perfectly good equipment from disposal. Figures from the UN’s Global E-waste Monitor estimate a staggering 82 billion kilograms of e-waste will be generated by 2030. This is a pressing issue, so every organisation needs to step up - and act.

By opting for refurbished, businesses can therefore be confident in their decision, knowing they’ll get exactly what they need for a smaller investment while also helping to reduce e-waste and supporting the government’s net zero goals.

Challenges with the lack of incentives for refurbished tech

While the benefits of refurbished technology are clear, current government tax incentives still heavily favour new tech, leaving refurbished options at a major disadvantage. Some businesses are realising the value of buying refurbished and the market is steadily growing, but many are still unaware of refurbished options. The public sector must create incentives to support the refurbished industry if this growth is to accelerate.

Super-deduction tax, for example, arrived in 2021, allowing UK companies to deduct 130% of the cost of qualifying plant and machinery investments from their taxable profits. While this policy helped businesses boost their productivity post-pandemic - a necessary move to get the UK economy back on track – it only applied to new assets, making refurbished options comparatively less attractive.

Including refurbished in the policy would have enabled companies to upgrade their equipment and get exactly what they wanted, all within budget, and would have given the UK a significant push forward on its path to net zero. The unfortunate reality is these fiscal decisions are pushing financial decision-makers away from refurbished and towards less sustainable new products.

The need for a cohesive government approach

The government is already paving the way for a net zero future, with green homes, schools and leisure facilities becoming the norm - but it’s not enough. Businesses must be able to adapt their technology strategies as well, making informed decisions in a market that operates on a level playing field.

Introducing tax incentives that include refurbished tech could be the answer to breaking down barriers. If provided as a viable option, refurbished could be a key player in the drive towards sustainable and cost-efficient business investment. To achieve this, we need policy makers and industry to come together. Now is the time to play fair, for everyone, and give refurbished tech equal footing.