The Green Deal Explained
The Green Deal Explained
The Government’s Green Deal is designed to help you make energy-saving improvements to your home and find the best way to pay for them.
What is the Green Deal?
The Green Deal is the name of a Government initiative to encourage homeowners, tenants and landlords to make energy improvements to their properties, including:
- replacing windows and doors
- installing secondary glazing
- using energy efficient lighting
- insulating lofts or walls
- adding draught proofing
- upgrading heating
- generating renewable energy from sources like wind or solar power
Homes are assessed by a registered and authorised assessor, who then makes recommendations for energy-saving improvements.
How does the Green Deal work?
It’s essentially a loan that allows you to spread the cost of the energy improvements over 10-25 years, with the repayments added to your electricity bill. The idea is that the cost of the loan shouldn’t be higher than the energy you save – so your outgoings won’t increase. Instead, potentially they might decrease.
Is the Green Deal still available?
The Green Deal was set up in 2013, but Government funding for the loans was stopped in July 2015. In 2017, the scheme was resurrected by private investors, but loans are not as easy to come by as before. However, you may still be able to get help to pay for energy improvement work to your home, if you qualify.
Who is eligible for the Green Deal?
Any household with an electricity meter (including prepayment meters) in England, Scotland or Wales may be able to use the scheme.
Both the landlord and the tenant must agree to the improvements, if the building is rented.
How can you get a Green Deal loan?
You must get your property assessed to use the Green Deal. You can either try to find an approved Green Deal assessor yourself. Or you can use a Green Deal provider to find an assessor for you.
You might have to pay for an assessment. If so, you must be told the cost beforehand. Typically, it can be around £100-£150.
After the assessment, you’ll get a Green Deal advice report which includes recommendations for improvements, and a statement as to whether the improvements will pay for themselves through reduced energy costs. You can then decide whether you want to get the work done and how you want to pay for it.
What happens in a Green Deal assessment?
When you book an assessment, you’ll be asked some basic questions about your property, typically:
- whether you own or rent it.
- what kind of construction your home is and when it was built.
- if there are access issues - for example, accessing your loft.
- what your energy use has been.
During the visit, the assessor will look at the property, your heating appliances and any energy-saving measures already in place. They may ask you questions about how often you use your heating, what temperature you have it set at, and how many baths and showers you have. This helps personalise the report for your household.
After the assessor’s visit, you’ll be sent a formal report and recommendations about what can be improved. These should set out what could be done, the estimated costs and the estimated savings.
You can then choose what work you might want to undertake.
How can you get Green Deal work done?
This may depend on the options available to you for paying for the work. You may be able to:
- ask a Green Deal provider to arrange the installation of improvements and pay for the work yourself.
- ask a Green Deal provider to arrange the installation of improvements and set up a Green Deal finance plan for you to pay for it.
- choose your own installers to make the improvements and pay for them yourself.
- pay for the work with a combination of a Green Deal finance plan, your own money and finance from another scheme.
As with any other work on your property, get quotes before you commit yourself. You should give the provider or installer your Green Deal report. Any quotes from a Green Deal provider will include your repayment terms, if you’ are using a finance plan. You can get more than one quote and you don’t have to have all the work that has been suggested, done, unless you want it.
How do you pay for work done under the Green Deal?
A Green Deal provider can offer you finance terms, but you should ask if you or your property are eligible for some funding from one of these schemes:
- Affordable Warmth Obligation Under this scheme, energy companies provide help for improvements to people on low incomes, or for properties where it’s hard to improve energy efficiency.
- Domestic Renewable Heat Incentive (RHI) – offers payments for the generation of renewable energy for heat.
- Smart Export Guarantee: If you generate more power than you need (for example, with solar or a wind turbine) you could sell the excess back to your energy provider.
- Local authority schemes: run to improve energy efficiency in homes. Check with your local council to see what, if anything, is available.
Again, the annual repayments on the loan should not be higher than the savings you might make on your energy bills.
What else do I need to know about paying for Green Deal work?
The whole ethos of the Green Deal is that loan repayments shouldn’t be more than the savings you make on your energy bills. But this isn’t a guarantee that your bill savings will equal the cost of your loan repayments. This is because it’s based only on estimates of a typical household's energy usage and savings. Also, it doesn’t account for energy price rises and falls.
What happens to the loan if I move house?
The loan is attached to the property you live in, not you. If you sell your home, it passes to the new owner.
What happens if I move into a property with the Green Deal?
If you move into a home with a Green Deal, your landlord or the person selling the property must show you a copy of the Energy Performance Certificate (EPC). This will spell out what improvements have been made and how much you will need to repay. Then, whoever pays the electricity bill, pays the outstanding money on the loan. You’ll have to choose an electricity supplier who is part of the Green Deal.
I already have a Green Deal loan. Can I switch energy suppliers?
You can switch energy suppliers if the new supplier is participating in the Green Deal programme. The loan will switch to your new supplier.
What happens when the loan is paid off?
Once the loan is paid in full it’ll be removed from your bill, and you could then enjoy the savings that the energy efficiency may have brought.