The Green Deal

This will be a new Government scheme that is to commence from October 2012 and will be designed to help upgrade the existing building stock to make it much more energy efficient.

Energy efficiency is extremely important in the face of both global warming and just as importantly, the use of limited natural resources. The demand for those limited natural resources is increasing due to the rapid development of countries such as China and India who have a combined population of 2.3 billion. The UK has a population of a mere 60 million.

The UK imports about 50% of our energy requirements and energy security is a future political concern.

Why do we need to upgrade the building stock?

A carbon reduction of some 80% by 2050 (based on 1990 levels) has been written into UK law. 70% of the building stock in 2050 is in existence today. Many buildings are very wasteful of energy. Waste occurs due to poor insulation and inefficient generation of heat and electricity. For example, modern condensing boilers are in the region of 90% efficient. There are boilers still in use today which maybe only 65% efficient. If you have an efficient boiler, but have poor insulation, then the heat generated will disappear through the building fabric more quickly than with a well insulated building. This will result in a larger carbon footprint than might be appropriate, and ultimately results in expensive energy bills. This is why it is essential for all home owners to ensure that they have sufficient loft insulation and to have cavity wall insulation where possible.

Hard to treat homes

There are many buildings that cannot have cavity wall insulation, because quite simply, they have solid walls. It is still possible to insulate solid walls either internally, or externally. The process is relatively expensive. However, if the 80% carbon reduction target is to be achieved, then the issue of solid wall insulation must be dealt with. It is understood (although definitive proposals are still awaited) that the proposed Green Deal will set in place a framework to make solid wall insulation more accessible from a cost point of view.

There will be a number of other energy saving measure that will fall under the umbrella of the Green Deal. This for example might include the replacement of inefficient boilers, the installation of double glazed windows, or the installation of thermostatic radiator valves.

Paying for these home improvements

The Green Deal is to be designed to finance these carbon reduction improvements. This finance will be paid for out of the energy savings that will be made as a consequence. This should mean that householders will not see any increases in household outgoings beyond what their energy bills might have been. They will then benefit from a home that feels warmer.

Frequently Asked Questions

What will happen if the building occupier changes?

The Green Deal finance will simply transfer to the new building occupier.

How will homeowners know what improvements to make?

A Home Energy Assessor (HEA) will inspect your home and provide a report recommending a number of improvements that can be carried out. The works will be carried out by an approved contractor and the finance will be arranged to pay for those works.

Will the Green Deal fund the installation of renewable energy, such as solar panels?

Technologies such as solar panels and heat pumps are supported by the Feed in Tariffs which give a strong financial incentive to invest in these types of installations, so it would seem unlikely that the Green Deal would cover the cost of such installations. However, we will have to await for the details proposals before we can be sure.

When will the Green Deal start?

It is understood that the scheme will commence in October 2012, with the detailed announcement expected sometime in 2011. Like many other things, the devil is very much in the detail and until the Government makes the detailed announcement, we will not know the scope and the complexity of the scheme. This article is intended only as a guide as to what it might mean in practice.

The Energy Performance Company specialises in the installation of Solar Photovoltaic and Solar Thermal panels which benefit from the generous Feed in Tariffs.