Saturday, 29 June 2013

Green Deal teething problems

I have read a few news reports recently saying bad things about the Green Deal.  After 5 months not one householder has had any measures installed through the Green Deal loan scheme[1]. Also the numbers of cavity walls being filled have crashed [2]. This is because previously energy companies often offered to fill cavity walls for free under the CERT (Carbon Emissions Reductions Target) and Warm Front programs, but now you have to finance it yourself (with a Green Deal loan or otherwise). Well that is perfectly true but if your house has a narrow cavity or is otherwise 'difficult to fill' you should be very happy right now. Your 'hard to treat' house which no-one wanted to know about before is now eligible for a grant through the Energy Companies Obligation (ECO) and the first full release of Green Deal statistics shows 18,000 of these have been fixed up so far. The Green Deal is working, sort of, and maybe it needs a bit more time to get going properly.


This first release of detailed Green Deal statistics reports measures installed under the ECO schema up to the end of April. The Carbon Savings Obligation part of the ECO grant scheme is explicitly targeted at hard to treat houses (those with narrow or difficult cavities or solid walls). The idea is that the energy companies have targets of how much carbon to save and the Green Deal Providers offer carbon savings in return for grants to their customers. The carbon savings are auctioned in lots every fortnight. Up to the end of April, £85 million had been given out to Green Deal providers under this scheme which shows that something is happening.

However, the ECO is supposed to treat solid wall houses as well as difficult to fill cavity walls and there have been very few of them installed so far: only about 1500, or 1 solid wall for every 12 narrow cavities. The reason for this is that solid wall insulation is even more expensive than filling narrow cavities - and the energy companies can buy their carbon savings more cheaply by giving grants for narrow cavities than solid walls. This is the rational working of a free market. Whether or not you think this is a good thing depends perhaps on whether you have a narrow cavity or a solid wall. Or whether you think we should be saving carbon as cheaply as we can or making sure that everyone has a real opportunity to reduce their energy bills.

By the way it is estimated that there were 3.1 million hard to treat cavity walls in Great Britain as of April 1st 2013 and only 0.7 million easy ones left. Also there were 7.7 million solid walled houses to insulate, with only 3% done so far [4].

I hear on the grape vine that there are discussions within DECC on the possibility of splitting the ECO Carbon Saving Target into separate targets for hard to treat cavity walls and solid walls. If they don't it is quite likely that we aren't going to get many solid walls insulated for a while, until the only cavity walls left are even more expensive than solid wall insulation.

The other good news in the Green Deal statistics is that lots of people who have had assessments done are getting improvements installed without using a Green Deal loan. We know this because 5000 cashback vouchers have been allocated (mostly for new boilers) and also a DECC survey found that one third of householders who have had an assessment done had at least one measure implemented already. (The survey was conducted at the end of March when there had been 9000 assessments completed. Now there are 38,000.) Green Deal loans are shockingly expensive because they count as a personal unsecured loan. You should definitely see what your mortgage company or bank has to offer before considering the Green Deal financing package. But that doesn't mean the Green Deal is a dead duck because the loan scheme is only a part of the whole deal. There are now 1800 fully accredited advisors and 1200 qualified providers to ensure that you get sensible advice and a reliable installation. Plus you get access to the ECO grants and the cashback scheme to get you started.



[1] No UK households have completed green deal process, figures show (Guardian, June 27 2013)
[2] Cavity wall insulations crash by 97% following green deal introduction (Guardian May 29 2013)
[3] Green Deal and Energy Company Obligation (ECO): monthly statistics (June 2013) (www.gov.uk)
[4] Estimates of home insulation levels in Great Britain (www.gov.uk)

2 comments:

  1. Good to hear some better news about Green Deal! The guardian articles were pretty depressing.
    I hope it becomes a success, but we still need so much more for the scale of our old-house problem.

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