The attempt by the Department for Energy and Climate Change to improve the energy efficiency of our homes through the implementation of the Green Deal has not met with universal approval by UK households.
A recent report on Radio 4’s flagship programme “You and Yours” indicated that as few as 200 households had signed up for the Green Deal. In March 2013, Energy Minister Greg Barker said he hoped to have at least 10,000 signed up by the end of this year.
The lack of take up of the green deal seems to indicate there is a certain degree of apathy amongst the general public on how the deal is supposed to work.
The key principles of the Green Deal are:
1. Insulating the UK’s ageing housing stock will cut carbon emissions and make energy affordable
2. Green Deal assessors ask basic questions about a household energy usage
3. Approved Green Deal installers such as DIY chains advise on improvements
4. Consumers pay for the changes by taking out a loan with the not-for-profit Green Deal Finance Company
5. The loan is paid back through electricity bills for periods of up to 25 years
6. There is no guarantee that savings made will match the cost of the loans.
There are a number of problems with the green deal as it stands.
Firstly the quality of the green assessments will determine whether or not a householder buys into the scheme or not. This is particularly relevant in these times of austerity where householders will be reluctant to sign up to a new scheme unless it demonstrates real value for money.
Secondly, the repayment of the loan through the householder’s electricity bill could over complicate the process and result in householders becoming confused especially when it comes around to switching electricity suppliers or moving home. Surely it would be better for the government sponsored not for profit Green Deal Finance Company to administer and manage the loan repayments directly with the householder.
Finally, will the green deal save the householder money in the long run? Well this will depend on a number of factors such as future energy prices which could outstrip any gains from the green deal. There is also the interest to pay on the loan the green deal provider can charge which varies between 6% and 9%.
What are your thoughts?
Michael is a freelance consultant with over 20 years’ experience in industry. He holds an MSc in Climate Change & Sustainable Development and is a member of the Energy Institute. He is passionate about the sustainable future of our planet and is keen to promote a cleaner, safer and healthier environment for future generations. His professional interests include renewable energy, smart networks and sustainable transport.