Green Deal Update

Chris Bates, Editor of Build It magazine
by Chris Bates
30th July 2014

The Green Deal Home Improvement Fund (GDHIF) closed its doors to new applications on the 24th of July, announced MP Amanda Rudd of the Department of Energy & Climate Change.

A victim of its own success, a sudden surge in applications meant that the deal met its allocated budget of £120 million, which left no money for new applicants. “We were always clear there was a budget, which is why we encouraged people to act quickly,” said Ms Rudd.

Launched on the 9th June 2014 as part of the government’s wider Green Deal scheme, the GDHIF was set up to help households in England and Wales improve the efficiency of their homes by offering cashback for those who installed energy-saving measures. Some or all of the further costs would be paid for by savings made on their energy bills.

Those installing more expensive solid wall insulation were able to claim back up to 75% of the cost, up to £6,000.

The ongoing flagship Green Deal scheme helps people to install energy-enhancing improvements to their property with the award of a loan to pay for upfront improvement costs, which is then paid off gradually through utility bills. This means the cost of the works remain with the house should the owners move on.

The original Green Deal suffered from low-uptake, in part due to the original £100 up-front energy assessment required, as well as the fact that homeowners were faced with a loan to repay the cost of works, which were often slow to pay for via reduced bills.

The controversial concept rested on the principle that the savings on the bills had to equal or exceed the cost of the improvements.

Previous government insulation incentive schemes came to an end at the end of 2012, which resulted in a dramatic collapse in the rates of people installing cavity wall insulation by mid-2013, according to data gathered by the Cavity Insulation Guarantee Agency. It was partly with this in mind that the Green Deal, and then the GDHIF, would help redress this decline.

Where this leaves homeowners looking for grants for energy-improvements is unclear, although they still have the option to take out a loan through the Green Deal. It is also unclear as to whether there is any scope for people who have paid for the £100 assessment but not yet undertaken the works to get the cost of this refunded.

Find out more about the green deal

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