It’s that time of year when focus switches to energy saving, and the UK government is getting in on the act. Today, the Department of Energy & Climate Change (DECC) has announced that the Energy Act has become law, paving the way for the Green Deal.
So, what does that actually mean? How will the Green Deal work for me?
Why do we need the Green Deal?
Energy prices are on an upward curve. To prevent them becoming even more of a burden, the UK is going to invest in a massive programme of energy saving measures called the Green Deal.
According to a new DECC report out today entitled ‘Housing Energy Fact File’, more than half of domestic properties do not have sufficient home insulation.
Furthermore, the report reveals that 50% more energy is used to power UK homes, than is used to power industry.
So, the thinking behind the Green Deal is to create homes which are warmer and cheaper to run. The overwhelming majority of UK homes are old and have varying levels of insulation or other energy efficiency measures.
How will the Green Deal work for me?
In a four step approach, the Green Deal will work in the following way.
- An independent and impartial assessment will be carried out of your property to determine what work needs to be carried out to make your home more energy efficient
- You will then be able to take that assessment to any Green Deal provider to get a variety of different quotes
- The home insulation and energy saving measures are installed and paid by your chosen Green Deal provider
- You repay the works through charges on your electricity bill
As they say, the devil is in the detail so it’s not entirely clear how this will work for householders at a granular level.
The first question on everyone’s mind will be costs. If like many, you have an extremely draughty property which is leaking heat everywhere. How will this cost in?
Diagram from the DECC showing how customers will be able to obtain the Green Deal
Energy Act paves the way for the Green Deal
The passing of the Energy Act, provides the first official green light for the Green Deal. The major elements of the Energy Act are as follows:
- Remove the upfront cost of energy efficiency measures – (loft insulation, cavity wall insulation, external wall insulation, double glazing, boilers, draught proofing) which will allow you to make the improvements.
- The energy saving will be repaid over time through a charge on the energy bill (in a global first) – the charge, however, must not be more than the energy saving, meaning that you should save from day one.
- Put householders at the heart of the Green Deal – To ensure that you get the best deal and are not ripped off, the government intends to introduce a “quality mark”, so you know who to trust for the job.
- Provide extra financial help for the vulnerable and hardest to treat homes – energy companies will have to fund work like boiler upgrades and basic insulation. Also, homes that are hard to treat will get special assistance.
- Improve 682,000 privately rented homes – from April 2018, landlords must ensure their rented properties comply with an “E” energy efficiency rating.
Chris Huhne, Energy Secretary commenting on the Act said:
“A huge hurdle has been passed in bringing the Green Deal closer to making homes warmer and cheaper to run. The coalition is doing all it can to bear down on energy prices, but insulation will provide the long term help to manage bills.
When it’s introduced, the Green Deal will be as easy as ABC by making work affordable, providing bespoke independent advice and choice in the market from well-known and trusted high street names.”
The devil is in the detail for the Green Deal?
As we approach winter it’s the perfect time to start thinking about what you will need in the way of home insulation and energy efficiency measures. Certainly, there’s a long way to go before we see the detail of the Green Deal initiative.
At Green Abode we’re particularly keen to understand how financing will work for customers. Belts are tightening everywhere and it’s difficult to see how this will be funded without assistance from major corporations and banks. Once they get involved, we know anything could happen.
Also, how will it work if you come to sell your property? Surely, the payback periods on works for the Green Deal will be long. Does the repayment sit with the householder or with the property?
Let’s just hope that come next year it will be as easy as “ABC” for householders.
