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The Green Deal never bothered us anyway…

By Energy Company Numbers on August 14, 2016 in Government and Schemes, Help and advice
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The Green Deal never bothered us anyway… As the Green Deal is finally put to bed and the government finally releases the conclusive figures for the scheme, one thing is becoming crystal clear: Nobody liked the Green Deal.

The so-called ‘ground-breaking’ energy efficiency loan scheme was supposed to be a game changer, and to set a precedent worldwide for encouragement of energy efficiency investment. But with a take up that can only be described as abysmal, and results that fell significantly short of government’s predictions, we can only ask ourselves, what went wrong?

Why we hated the Green Deal

There were a number of fundamental flaws in the Green Deal which contributed to its failure. These included:

Lack of testing: No consumer testing or focus groups were consulted prior to launch.

Wildly optimistic figures: The government predicted £1.1bn of loans being issued, the result was actually just £50m.

Costly for the taxpayer: Each loan given out cost the taxpayer on average £17,000.

Too complicated: The application process was drawn out and confusing, and there was a ridiculous amount of paperwork to contend with, which put people off.

Too expensive: Green Deal loans came with an interest rate of 10 per cent, which is a lot higher than many high street lenders and even credit cards would charge.

Related: What is the Domestic Renewable Heat Incentive (RHI)?

What could have been an amazing scheme was poorly researched, poorly formed and poorly marketed, ultimately leading to its demise. DECC spent around £240m setting up and administering the scheme, but now it’s back to the drawing board to find other ways of encouraging energy efficiency in the UK.

Do we still need energy efficiency?

The issue of improving UK housing stock is not going away. With our 27 million homes accounting for around a quarter of the UK’s energy demand and associated carbon emissions, we can’t afford to ignore the opportunities presented by simply insulating and making our homes more efficient. Already our housing stock is among the least energy efficient in all of Europe, which not only makes them more expensive to live in, but opens residents up to a range of health risks too.

Related: The CMA energy reforms: What will it mean for you?

Fuel poverty is defined as spending more than 10 per cent of your income on heating your home. Despite decades of hard work by organisations like National Energy Action, the Energy Saving Trust and EAGA, still around 2.35 million UK households are living with fuel poverty. The rising cost of energy, combined with the stagnant economy over the past few years have worked together to force more households into fuel poverty.

The knock on effect of this is that people literally have to choose between heating their home and eating. This can lead to them living in cold, damp conditions, which in turn can exacerbate underlying health conditions such as respiratory illnesses, arthritis and heart conditions. This in turn contributes to the number of ‘excess winter deaths’ in the UK, of which there were over 43,000 last year in England and Wales alone.

Aside of tackling fuel poverty, reducing our spend on gas and electricity and, of course, our greenhouse gas emissions here in the UK, living in a well-insulated home comes with plenty of comfort benefits too. In short, the response to whether we still need to encourage energy efficiency or not can be conclusively answered, yes.

Improving efficiency without the Green Deal

Heading towards a more energy efficient future need not be hampered by the lack of Green Deal or other schemes. In fact, self-funding insulation for our homes is an investment we should not be shy of making off our own backs. For instance:

– Loft insulation (with nothing there already): Costs from £285 – £395 to install, saves between £135 – £240 per year. Will pay for itself in 1 – 2 years.
– Loft insulation (top up existing to recommended 270mm): Costs £240 – £310 to install, saves between £15 – £25 a year. Will pay for itself in 10 – 14 years.
Cavity wall insulation: Costs from £330 – £720 to install, saves between £90 – £275 per year. Will pay for itself in 2 – 4 years.
– Boiler replacement: Will cost in the region of £1,800, saves between £79 – £273 each year depending on the age of your old boiler. Will pay for itself in 7 – 22 years.

When there’s a low payback period (time to pay for itself), investing in energy efficiency is a no-brainer.

Related: What is the London Boiler Cashback Scheme?

However, even if the payback period is longer, you should also take into account the potential for additional comfort, better temperature control and sound proofing that can also come with having a well-insulated house.

In some situations, you may be eligible for help with the costs of becoming more energy efficient. People in receipt of certain benefits can get their replacement boiler paid for, and some houses will qualify for free loft and cavity wall insulation, regardless of the owner’s income, all under the Energy Company’s Obligation (ECO) scheme. The fastest way to find out if you are eligible is by contacting the Energy Saving Trust for a free assessment over the phone. Talk to them on 0300 123 1234.

About the Author

Energy Company NumbersView all posts by Energy Company Numbers
Energy Company Numbers is a telephone number directory service dedicated to helping UK consumers keep in touch with their energy suppliers.

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