DECC Green Deal
The Department of Energy and Climate Change have identified that many UK homes lack adequate energy efficiency measures. This has resulted in homes that are hard to heat, draughty, damp and ultimately produce large amounts of C02. Domestic CO2 emissions, according to the DECC, accounts for almost a quarter of all Carbon emissions. With a reduction of carbon emissions of 34% needed by 2020 the DECC, and the government as a whole, know that something drastic must be done.
In response the DECC are currently in the process of introducing a scheme that will revolutionise the energy efficiency of the UK’s housing stock. The scheme will allow consumers to conduct energy efficiency improvements at no immediate cost. The DECC have named the scheme the ‘Green Deal’.
At the heart of the DECC Green Deal is its unique financing structure known as Green Deal Finance. Green Deal Finance will enable consumers to conduct efficiency improvements, through a loan that will be treated like a fixed term contract. Though this is where the similarities between a regular loan and Green Deal Finance loan cease to be. The loan provided through the Green Deal finance structure will be linked to the property, not the individual. Should an inhabitant move out, any subsequent owner, or tenet, will be responsible for any obligations. Any savings made should not be more than that of repayments; therefore consumers can enjoy the benefits of improved energy efficiency at no extra cost. The DECC intend that the unique structure of Green Deal Finance will increase the attractiveness of the Green Deal.
There will be three main parties involved in the DECC Green Deal. Green Deal Assessors will usually be the first physical contact a consumer has with something associated with the Green Deal. Assessors will attend a property and conduct an assessment, centred on the EPC, and recommend a variety of potential measures. Measures available to assessors will not be unlimited however; they must be approved under the Green Deal. Consumers can then contact a Green Deal Provider who will provide Green Deal Finance. A Provider will have the final say in what improvements will be available for installation. Next, a Green Deal Installer retrofits the property with the agreed energy efficiency improvements. The DECC have approved a variety of measures for use including insulation, water systems, condensing boilers and solar panels.
The DECC are creating a number of guidelines, quality marks, safety frameworks and various criteria to ensure that consumers receive a high quality, standardised service at every step in the Green Deal. The DECC are proposing the ‘Green Mark’, for example, that will have to be displayed by any assessor, provider or installer allowing customers to identify that they are certified. This discourages, and ultimately prevents fraudulent practices, especially common in Trades such as plumbers, electricians etc, whom will be relied upon heavily to fulfil the roles of Green Deal Installers.
DECC officials, including Chris Huhne hope that the Green Deal will help to reduce the UK’s CO2 emissions. Though this depends on how consumers approach the Green Deal and as to whether or not there is an enthusiastic uptake. The DECC have stated that Interest Rates must be kept reasonably low to maintain the survivability of the deal.