Green Deal interest rates fair, says Ed Davey
Ed Davey defends Green Deal interest rates.
The UK Secretary of State for Energy and Climate Change has given a speech at the annual Eco Build conference defending the Green Deal and outlining the government’s plans for renewable energy in the UK.
He also defended the interest rates for the Green Deal, saying that he ‘wouldn’t concede’ that the rates are too high, despite Nationwide offering a similar loan at just 2.29%.
Ed Davey told the attendees that the future of energy efficiency is a ‘long term transformation’ that will cut carbon emissions by between a quarter and two-fifths before the middle of the next decade.
He also outlined the impact of energy efficiency on gas and electricity prices, saying that the government needed to ‘get this right [in order] to help people struggling with the rising costs of energy bills':
‘Domestic gas prices increased by an average of just under eight per cent in the last months of 2012 on the back of a sustained rise in gas prices over the last five years. And, with the economic situation as it is we have to help people who are struggling to keep up.’
The long awaited Green Deal, launched on the 28th January, is a government incentive scheme to allow households to invest in energy-efficiency measures without an hefty upfront cost.
Customers arrange for a ‘Green Deal assessment’, where possible improvements are outlined by an accredited Green Deal assessor. The assessment is then taken to a Green Deal provider who carries out the work. However, the cost of the energy-saving measures is paid back on the energy bill over time, and never more that the subsequent savings on the energy bill.
With no official figures of uptake, it’s difficult to say how popular the scheme has been, but it has received criticism for being under publicised and too complicated for consumers to understand.
However, in his speech Davey said that renewable energy was the only real way to help households manage their energy bills in the UK: ‘The government can’t control wholesale prices in a global gas market. Gas demand is booming to fuel emerging economies like India and China to replace nuclear power that Japan has turned off and Germany has turned its back on. Even shale gas revolution won’t help to get global gas prices lower.
‘So, the best way to help the fuel-poor in Britain is to help all those faced with high energy bills be they businesses or people is to reduce the amount of energy we need to use. If we get this right, people will have warmer homes for less, with lower bills than would have otherwise been the case.’
Despite refusing to disclose figures on the uptake of the Green Deal scheme, Ed Davey did say that businesses were on board:
‘In terms of the trade, there are already 40 approved Green Deal providers. These are the big companies, the networks that have been approved to oversee things. There are 75 assessor organisations registered and over 600 installer organisations too. And we know from talking to these bodies, talking to these people, there is a good pipeline of work already.
‘So even in these early days there are good signs of growth and a market in the making. To finish, let me come back to what I said in the beginning: this is a long-term transformation we are talking about. Of course in some cases the life of the Green Deal could extend up to 25 years, but the benefits and the emission reductions can felt immediately.’