Green Dale

What is the Green Deal?

Landlords: The Green Deal gives you the opportunity to install microgeneration systems on your properties. All or most of the installation cost will be covered through your tenant’s energy bills and you (the landlord) can claim the Feed-in-Tariff or Renewable Heat Incentive straight away.

Homeowners: The Green Deal offers you the opportunity to install microgeneration systems onto your property, with little or no upfront payment and claim the Feed-in-Tariff or Renewable Heat Incentive straight away.

Compared with most of Europe, Britain’s housing stock is poorly insulated and energy inefficient, leaking heat and using up energy. 25% of the UK’s carbon emissions come from the energy we use to heat our homes, with a similar amount being generated by our businesses, industry and workplaces. As energy consumers, we are paying an increasingly high price for our energy consumption and so is the environment.

The Green Deal was announced by the Department of Energy and Climate Change and is due to come into effect in January 2013. It is a revolutionary programme designed to bring our buildings up to date and make them more energy efficient. Through the Green Deal, bill payers will be able to make energy efficient improvements to their properties without having to pay up-front. Instead, Green Deal registered companies will provide the finance, recouping their money back via

savings on the energy bill. This means consumers (homeowner or tenants) can see the Green Deal charge alongside the reductions in energy use which generate savings on their bill. It also means that if they move out and cease to be the bill-payer at that property, the financial obligation doesn’t move with them but moves to the next bill payer: the charge is only paid whilst the benefits are enjoyed. In this way, the Green Deal differs from existing lending – it is not a conventional loan since the bill-payer is not liable for the full capital cost of the measures, only the charges due.

At the core of the Green Deal provision is one simple rule:

Estimated savings on bills will always equal or exceed the cost of the work.

The whole framework is very flexible and is designed to help consumers and businesses to tailor an energy efficiency package which best suits their requirements. Because there is no need for an up-front capital investment from the end user, the Green Deal could benefit millions of homes and businesses, including owner-occupiers and tenants alike.

By making homes and businesses more energy efficient, Britain can cut our carbon emissions and make real progress toward the 2050 emissions reduction target.

Consumer protection is paramount to the implementation the Green Deal. As such, the following pre-requisites are embedded into the Green Deal Plans:

  1. The expected financial savings must be equal to or greater than the costs attached to the energy bill, this is known as “the golden rule” of the Green Deal. If a chosen measure does not achieve the golden rule it may be possible to make an upfront payment to cover the difference.
  2. The measures must be approved and the claimed bill savings must be those accredited through this process.
  3. The measures installed must have been recommended for that property by an accredited, objective adviser who has carried out an assessment.
  4. The measures must be installed by an accredited installer.
  5. For householders, the Green Deal provider must give appropriate advice within the terms of the Consumer Credit Act and take account of the individual circumstances of the applicant.
  6. The Green Deal provider must have consent from the relevant parties, including the express consent of the current energy bill-payer.
  7. The presence of a Green Deal must be properly disclosed to subsequent billpayers (e.g. new owners or tenants) alongside energy performance information.
  8. Energy suppliers must collect the Green Deal charge and pass it on within the existing regulatory safeguards for collecting energy bill payments – including protections for vulnerable consumers.

As “the golden rule” states, to qualify for the Green Deal, expected savings in typical properties consuming a normal amount of energy must be equal to or greater than the cost of the measure. However, the government will not guarantee actual cash savings because only the businesses and consumers benefiting from the upgrades can control how much energy they use within their property

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