Today the government are launching the new Green Deal. The Green Deal provides a loan to help you to upgrade your home to make it more energy efficient. The loan is repaid via your energy bills.
The cost of work done on your home will be added to you energy bills, so the cost will be spread out. Also, the cost of the work that is done should in theory offset the reduction in bills.
“Technically the Green Deal is a charge attached to the electricity meter of your house”. – Which?
Because of the problems and confusion many have had with the previous system that provided free loft insulation for over the 70’s, here we talk through some of the details of the new scheme. It does seem at first glance that there are opportunities for businesses to charge home-owners a little up front, so we do expect some hard selling to start.
“Stay warm for less”
The government’s plan is to allow people to “stay warm for less”. The scheme provides cheap loans to pay for improvements to insulation and new boilers.
The work will be carried out in 3 main stages:
- To receive funding your home will be inspected by an independent assessor who will determine what work, if any, is needed to improve the energy efficiency of your home. These assessments may not be free and assessors may charge up to £150.
- You are given an Energy Performance Certificate by the assessor and advice is given on how to improve your home.
- Green Deal providers (we list Essex providers below) will then quote you a price on the work to be completed. You are entitled to get several quotes – you are not locked in to a particular builder / contractor.
- The work is done with no initial cost – that means you pay nothing up front. If someone asks for money upfront to “get the ball rolling” or “cover the costs of the materials” then they are not adhering to the rules of the Green Deal. However, suppliers may charge a set-up fee of £63 for the loan, and operating charges of £20 a year – they may put this bill direct on to you.
- The cost of the work, which must not change from the initial quotation, is then charged to you via the Green Deal Finance Company (they are a not-for-profit business).
- You pay the Green Deal Finance Company off over the next 25 years via your energy bills.
Questions About the Green Deal
We currently have several questions about the Green Deal that we hope to be able to answer here at EssexPortal soon:
- What happens if you want to switch energy supplier? How so the loan transferred and who is responsible for the admin – your current energy supplier, the new one, or the Green Deal Finance Company?
- If you sell your home how is the load passed on to the new owner – are property conveyancers / solicitors geared up for this already? We know that the charges are passed on to the new homeowner, but do not know how this is managed in the sale of a home.
- What is the interest rate? Is is fixed of variable? We have an answer to this – it could be around 7%
- Can you repay early? Yes – but there is a there is also a penalty for early repayment.
- Is the assessment free? No, you may be charged £150 for the first assessment and need to have a credit check.
Unfair Exclusions From the Deal
John Oddi from Crystal Windows and Doors Ltd. in Essex told the Guardian that the deal was not fair as small companies such as his are not allowed to join the scheme. For a company to be allowed on the scheme they have to be able to provide all forms of insulation. As John Oddi’s company only provide windows and doors he cannot be a part of it, which means he is losing out on business. Many homes can get huge savings by replacing old wooden single glazed windows and drafty doors with new PVC ones.
Although the scheme does provide a system so that smaller companies can become affiliated with larger suppliers, John Oddi said that there was too much bureaucracy and the process too complex to put in place for a small business.
Other Ways to Save Money On Bills
White Goods Burn 40% Energy
Saving energy is not just about insulation. You can make huge savings on your energy bills by investing in energy efficient white goods, so better fridges, freezers, washing machines, tumble driers and dishwashers.
Turn The Thermostat Down
You can save a lot of money on your heating bills by turning the thermostat down a few degrees during the day, and a few more at night.
Also, if you have many rooms in the house, consider lowering the temperatures in the rooms that are not used as much and switch off the radiators in spare rooms. If you have individual thermostats on each radiator you can switch off kitchen and living room radiators at night so that just the bedrooms are kept warm at night.
Balance Your Radiators
You can also save money by balancing your radiators. Most homes will have a cold room, usually one facing north. Rather than increase the thermostat of the whole house to keep this room warm (which a lot of people do), turn the radiators down in all the other rooms. That way, the cold room will get more heat from its radiator without the rest of the house being too hot. Trial and error will lead to an ideal level in all rooms.
Draft Excluder / Sausage Dogs
If you have a draft under a front or back door placing a draft excluder down can provide very cheap insulation and save on your heating. Do this before considering expensive renovations and new doors!
Will It Really Work?
Not everybody is so confident that the Green Deal will work.
“The government’s flagship “green deal” home insulation programme provides no guarantee of saving money for cash-strapped households” The Guardian, 28/1/13.
The Guardian also say that the interest rate is to be around 7%. This is a huge figure and it means that many people may be better of financing the work themselves. If you have a mortgage it may be better to remortgage £10,000 to make the improvements, and find a reliable local builder, rather than take out a 10 to 25 year loan at 7% with the government (or a non-profit organisation backed by the government).
Green Deal Providers in and around Essex
There are currently no official providers in Essex, but the Green Deal Oversight & Registration Body website provides several that operate near Essex. Many actually provide UK coverage, so check the main website. If you wish to have a relatively local supplier then these could be the closest (info. subject to change).
Aran Services Limited
- Units 1-6, The Old Station, Higham, Bury St Edmunds, Suffolk, IP28 6NE.
- Provider ID: GDPA112
- Website: www.aranservices.co.uk
- Green Deal Enquiries Email: [email protected]
- Green Deal Enquiries Telephone: 01284 812520 / 0800 587 7795
More on the Green Deal
Green Deal: energy saving for your home or business – www.gov.uk
The Green Deal Energy savings for homes and business (PDF) – Department of Energy and Climate Change
Green deal ‘unlikely to deliver promises’, say experts. – The Guardian, Monday 28 January 2013