Green Deal or No Deal?

The Green Deal is one of those ideas that sound great to the politicians who nurture them, but are in danger of losing their way when they finally get sent out into the world.

The concept is simple and elegant. Homeowners are offered loans to improve the energy efficiency of their houses, which are paid back as part of future energy bills. The improvements are intended to save at least as much money from the bills as the cost of paying off the loan. The ‘Golden Rule’ promised by the policy is that the homeowner will not pay any more than the existing cost of energy used.

Inevitably there is a fairly complex and bureaucratic system behind it all, involving approved assessors, providers and the like. The last figures released show that around 10,000 people had paid the upfront fee to have an assessment carried out by the end of March, but the government seem coy about how many have gone to the next stage and commissioned the work.

From what I’ve seen, the genuine assessors are not always independent, often effectively acting as salesmen for the installers. Trading Standards have also had to begin prosecuting fraudsters who are going door to door pretending that they are approved assessors and ripping people off.

The government’s own survey has shown that consumers find the Green Deal confusing and lack confidence in it, perhaps because of the poor track record that the energy suppliers have in ‘door to door’ selling, or because the thought of taking on another loan is off-putting.

Critics suggest that the main uptake will be by the more wealthy home owners whilst low income families in cold, poorly insulated houses will be less likely to take the risk. The ‘Golden Rule’ relies heavily on the predicted energy savings being correct, whereas in the construction industry they are notorious for their wild inaccuracy. So the jury is very much out on whether the Green Deal will be a success. The problems that seem to be arising are not because it is a bad idea, it just needs the government to explain it properly to a sceptical public.

The next release of takeup figures is due to be released on 14^th May. I will read them with interest.