Overall the ‘Green Deal’ is a very exciting and positive scheme that should be supported and encouraged, however there are still some key concerns that need to be addressed if the scheme is to be the success it could be.

The ‘Green Deal’ is a framework to enable private firms to offer consumers energy efficiency improvements for their homes, community spaces and businesses at no upfront cost, and recoup payments through ongoing charges on energy bills.

The financing mechanism allows consumers to pay back through their energy bills. This means consumers will offset the ‘Green Deal’ cost against the savings in energy use and therefore 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 of the property in question. The charge is only paid whilst the benefits are enjoyed.

There are a number of important consumer protections which will be embedded into the Green Deal. The most important of these are:

  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.
  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.
Whilst the ‘Green Deal’ is arguably the most proactive piece of domestic green legislation to date, there are some key concerns:
  1.  Large providers (energy companies and contractors) will provide assessments free of charge or at a low rate such that truly independent specialists cannot compete. Therefore any claims that this new scheme will result in mass new employment and or the opportunity for Surveyors and Architects to diversify should be taken with a large pinch of salt.
  2. With nearly all assessments being completed by representatives of accredited ‘Green Deal’ providers and/or installers (as is predicted), there is a very real concern that this will result in a lack of independent/impartial advice to the consumer. There may be huge pressure for assessors who are employed by accredited ‘Green Deal’ providers to promote products and or measures that will be most profitable for the installer (and/or provider) and not those that are necessarily the best or most cost effective for the consumer.
  3. With companies competing to provide the initial assessments to the consumer as cheaply as possible (or even free of charge) there is a risk that the quality of the assessments may suffer, and a ‘one size fits all’ approach is adopted by many assessors.
  4. There may also be a huge difference between the final performance of an upgraded home and the initial predictions, with many homes not seeing the energy bill savings predicted.
  5. Customers will not sign up if the interest rate is too high or the repayment system too complex.

Richard Lloyd, executive director, ‘Which?’ is quoted as saying:

“Unless people are offered a good deal that they can trust and understand, it’s difficult to imagine them flocking to take up Green Deal measures. They won’t if the interest rate is too high or the predicted energy bill savings don’t materialise. The government’s latest consultation does little to put our minds at rest, as the energy department’s own consumer research found that only a small number of people expressed a strong interest and many felt the annual cost savings were simply too small to make it worth their while... We want assessments that are personalised, accurate and genuinely impartial”