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The Green Deal

Article by Adeela Ahmed on Apr 25, 2012 View in browser

The Green Deal

A finance mechanism designed to allow carbon reducing / energy bill reducing improvements to be carried out to any building. The finance is paid for by the energy bill savings that will be made. This scheme is due to be available from October 2012.

Energy Efficiency and the Green Deal

What is the Green Deal
The Green Deal is a finance mechanism designed to allow carbon reducing / energy bill reducing improvements to be carried out to any building. The finance is paid for by the energy bill savings that will be made. This scheme is due to be available from October 2012.
Green Deal finance must obey the Golden Rule, which states that the cost of any improvements will be less than or equal to the energy bill savings. The scheme is therefore designed to be “energy bill neutral” and is available at no upfront cost to the occupant or the landlord. The precise rules and calculation methodology have yet to be published.
The Green Deal process will be strictly regulated. Those organisations providing the Green Deal finance, the assessors and the contractors will all be regulated by the appropriate regulation bodies.
What is the Green Deal trying to achieve?
The UK Government has legally binding carbon reduction targets of 80% by 2050 (from 1990 levels). Given that 25% of carbon emissions come from the housing stock, then the housing stock needs to deliver its part in reducing carbon emissions.
The Government has designed this scheme to make energy efficiency improvements, which without the Green Deal, might be expensive, accessible to everyone.
There is a very large disparity in the energy efficiency of houses built to current building regulations, compared to the much older stock.  It is therefore a reasonable assumption that measures are aimed primarily at older buildings.
Who pays for this finance?
The bill payer.  If the tenant moves out, then the new occupant will be subject to that finance.
Why should landlords think about energy efficiency?
The Government has reserved the right, that from 2015 a positive obligation will be put on landlords to upgrade buildings which have an EPC rating of band F or G. There is a clear direction from the Government that the UK building stock needs to become more energy efficient. It is likely that other proposals will develop to encourage investment back into the building stock.
From 2016 all new homes are meant to be “carbon neutral”. So the difference in energy efficiency between old and new homes will be significant. New homes at this time will therefore have significantly lower energy costs, and in a competitive market, we believe that potential occupants will begin to consider the EPC rating before buying or renting a particular house.


Who are we?
At the Energy Performance Company Ltd, we advise and install a number of low carbon building solutions including:
•    Solid wall insulation
•    LED lighting
•    Solar Photovoltaic
•    Solar Thermal
•    Heat Pumps
•    Boiler replacement and heating controls
•    Under floor heating
For further information, please call 01636 52517 or email