The Green Deal – the good, the bad but mostly the computer says NO!

Since the first day I heard of the new government ‘Green Deal’ scheme to help all of us make our homes more energy efficient, save us money and ultimately limit the co2 emissions our houses give off, I was a fan. Couldn’t preach enough on the virtues of getting a professional bod in to our respective homes and a personal run down on what’s needed to do be more energy efficient.

And I’m still a fan of this new government scheme but from recent letters I’ve had it may need some tweaking by the government to work for the majority of householders.

If you’re not aware of the Green Deal yet, which kicked in on January 28th, it means whether you need a new boiler, say or loft insulation, a company will install it and you’ll pay nothing up front for the cost of the work. You will then pay off the cost of the work though your electricity bill. Brilliant in theory, as most of us don’t have £3000 to replace a boiler. However for this to happen you need to meet what is known as the Golden Rule. The Golden Rule states the expected financial savings must be equal or greater than the costs attached to the energy bill. For example if you currently pay £100 a month in gas and electricity and the new energy saving measures you agree to cut your bills by £20 per month, you don’t pay back more on the loan than that amount.

Again – fabulous in theory. However there seem to be problems with this scheme already. One reader wrote this week with his dilemma after having applied for the Green Deal. He asked British Gas, one of the first big organisations who signed up to be part of the scheme, to come in to do a Green Deal appraisal. The cost for assessment was £95. Our reader had already advised British Gas that he was living in a large draughty, Georgian house with an old G-rated boiler that was no longer efficient and that loft insulation and draught saving measures were also needed. British Gas was happy to come to do the assessment knowing these facts. However due to the home being listed, the majority of advice given couldn’t be taken up – our reader was advised the cost would be ?30,000 to do all energy measures and their home did not meet the Golden Rule to have the Green Deal. Basically each time all details were typed into the computer the computer said NO! This reader on our advice did ask for a full refund which I’m pleased to say British Gas did immediately in the knowledge his house was not suitable.

So it seems that to be eligible for this new government incentive you need to have many energy efficient measures already in place and living in a modern home already equipped with many of the latest energy efficient measures – i.e. double glazing, loft insulation etc. Worryingly it seems to defeat the purpose of the Green Deal loan. How are the government going to over come this? Watch this space.