The Green Deal
What is the Green Deal?
Introduced in January 2013, The Green Deal is the Government's flagship scheme to help reduce carbon emissions from buildings, whilst also lowering the bills for the occupier. It aims to make it possible for millions of homes and businesses to improve their energy efficiency at no upfront cost.
How can you participate?
To participate in the Green Deal is easy; the owner or occupier of the property must arrange for an approved assessor to visit the property and draw up a plan showing the potential energy efficient improvements that could be made, the cost involved and the potential energy savings from doing so. They might also make recommendations on energy saving behaviour.
Improvements carried out
The improvements are then carried out by accredited Green Deal providers/installers and will typically include loft or cavity wall insulation, heating, draught-proofing, double glazing and even renewable energy technologies - e.g. solar panels or wind turbines. A key principle of the Green Deal is that it must deliver appropriate, high-quality measures installed to a good standard, which will generate real improvements in the energy efficiency of each property. For this reason, all Green Deal advisors, advice services, installers and providers must be approved - just look out for their quality mark pictured above.
Repaying the loan
The scheme allows for the installation of energy efficiency measures, which is then paid back by the occupier of the property through the energy bills. How?
The scheme operates under the "Golden Rule" which, put simply, means the cost of repaying the loan should not exceed the estimated energy savings in each period. For example, if it’s estimated you’ll save £50 a quarter on your energy bills (after having energy efficiency measures carried out), your Green Deal provider may not recover more than £50 a quarter from you to pay back your loan.
Once the repayments are complete, the energy efficiency measures are owned by the property owner and its unique concept is that the finance stays with the property, so repayments would be taken on by any new occupier. This means if you sell your property and have had Green Deal work carried out, the loan stays with the property and not you.
So, how might this affect your property?
Although the Green Deal works best for owner-occupied properties, tenants will also be able to make use of the scheme, although they will need the landlord’s consent beforehand.
The existence of Green Deal finance is recorded on the Energy Performance Certificate (EPC), meaning any future occupiers are aware of its existence from the outset and know that loan repayments are ongoing.
Looking forward, there are further implications from The Energy Act 2011 which suggest that, from 2016, landlords will not have the right to refuse any reasonable request from the tenants to make improvements under The Green Deal. And from 2018, minimum energy efficiency standards will be introduced in private rented accommodation which will mean properties with a low rating will not be permitted to be rented.
For impartial advice on the Green Deal and energy saving home improvements, call the Energy Saving Advice Service on 0300 123 1234.
