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Green Deal promises help for all households
Financial help is on its way to help householders improve the energy efficiency of their homes, as last week the Government announced further details of its proposed Green Deal. The Energy Bill was passed through Parliament with support from all parties, although there were many concerns about lack of detail.
The Green Deal aims to encourage the uptake of energy efficiency measures in homes by providing loans, repaid from the savings made by lower bills. The loans, due to be available from Autumn 2012, will be attached to the house not the owners, so that if the occupants move house, the repayments are paid by the new occupants' fuel bill savings. The savings will also be larger than the loan repayments, to encourage the uptake of the Green Deal package.
Critically, the second reading of the bill suggests an increase to the maximum loan amount from the previously proposed £6500 (which would only pay for minimal measures) to a slightly more realistic £10,000. Even then, with recent external wall insulation jobs in Devon coming in at around £12,000 for a 3-bedroom house, the sums available seem insufficient to treat many homes which may require multiple measures. Discussions in Parliament suggested that extra help for "hard to treat" homes, such as those with solid walls or no mains gas connection, may be available from energy companies, but no further details are yet available.
Of great significance was the announcement that by 2016 tenants and local councils could demand that reasonable energy efficiency improvements are made to their homes. By 2018 it will be unlawful to rent out a property with an energy efficiency rating of SAP Band F or G, (the poorest performing houses). This is a huge step forward for private tenants, who are much more likely to live in an inefficient home, but with seven years to wait and fuel prices rising, many people are calling for the legislation to be brought in earlier.
Despite the scale of the proposals, many questions remain unclear and there is still a huge amount of detail to be clarified, with around 50 pieces of secondary legislation required to support the bill. Major questions remain about the interest rate at which the loans are set with concerns that many people will be deterred by high rates. There is also very little clarity about how the loans will be financed and the measures determined and approved.
Even though there are many unanswered questions, Energy Action Devon welcomes the Energy Bill as a significant move in the right direction. But with the need to retrofit between 500,000 and a million homes a year to meet our national 2050 carbon reduction targets of 80%, we have great concerns about the lack of skilled capacity to deliver the measures required.
We hope that by keeping informed of developments in the coming months, and working with our partners locally, regionally and nationally, we will be able to help Devon households benefit from the Green Deal as soon it is available.
Full details of the Green Deal can be found on the DECC website.