‘The Green Deal’, a campaign promise that’s become the political buzzword of our time, but what is it? If everything goes according to plan the Green Deal will ‘revolutionize the energy efficiency of the nation’s homes and businesses.’ Well, that’s what the Department of Energy and Climate Change (DECC) claims anyway. Others have labelled it, in slightly less flattering terms, as a ‘middle-class subsidy’.
Whatever your view, the proposals are due to be rolled out from October this year, so to help prepare you for what’s coming – or just impress the neighbours with your knowledge – we’ve pulled together the Top Five Must-Know Facts about the Green Deal:
1) What’s the ‘deal’?
This is the corner-stone of the Green Deal, it’s main selling point; in a nutshell, the Green Deal will fund energy-saving upgrades for your home like boilers, draught-proofing, loft and wall insulation. You’ll still pay for them, but not upfront, rather the cost will be staggered over time as an additional charge on your electricity bill. But here’s the deal: your repayments will have to be less than the energy savings you make by installing the product. How’s that being calculated? Well, that’s a whole separate issue.
2) So how will it work?
From a consumer point of a view there’s a few key steps you will have to take. First, what needs to be done to your home? You’ll have to get a property assessment, which will lay out exactly which energy-saving upgrades are suitable for your property. Next, shop around. Take that assessment to Green Deal providers (don’t worry, we’ll get to that in a minute) who will give you a range of quotes for the work. Take your pick, have the work done with no upfront costs, and start paying it back in your energy bills.
3) Where does the money come from?
The Green Deal is essentially a loan from the private companies installing these energy efficiency measures. There’s a maximum amount of £6,500 per household and crucially this is tied to the home, rather than the owner, so if you move house the debt is passed on to whoever buys it. The loan is then paid back through the electricity bill over a 25-year period. Also, unlike many other home improvements initiatives, the Green Deal is not dependent on people’s income, with the loans being available to everyone.
4) And when is all this happening?
Don’t worry, you’ve got a bit of time to let all this bed in. The Green Deal was part of the Energy Act, which came into force in October 2011, meaning the proposals under Green Deal itself should start to be rolled out in October this year – one year on. However, don’t expect Green Deal mayhem straight away.
5) But didn’t the energy secretary just resign?
Yes, former Energy Secretary and champion of the Green Deal Chris Huhne has resigned to tackle charges of perverting the course of justice. However, his replacement Ed Davey has already made it clear that he’ll be following through on the Green Deal. He said:
“My department is already implementing bold and ambitious reforms – like electricity market reform and the Green Deal – to unlock private investment, drive innovation and build a resilient, green, competitive economy. It’s now my job to see those through.”
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