Green Deal is not so golden, says Which?
23 November 2011
As the Government launches its consultation on the Green Deal, Richard Lloyd, executive director at Which?, says:
“It’s difficult to see how hard-pressed homeowners will have confidence in how the Green Deal might work for them if the suggested savings are initially based on averages rather than on their personal energy use.
“The Golden Rule was supposed to reassure people that Green Deal repayments would not exceed the savings made on energy bills. But if this is based on average figures then it could be meaningless for many.
“The Government estimates that average household energy bills will be 7% lower than they would have been by 2020 because of new energy and climate policies. But this is based on the big assumption that schemes like Green Deal will appeal to consumers. If take-up is lower than expected, energy bills will be pushed up even further.”
Notes to Editor
The consultation states that the upper limit of the Green Deal charge in Year 1 should be limited to estimated savings based on a standardised assessment of a domestic property, using:
- standard assumptions about energy prices, heating, lighting and hot water use and the performance of measures in a property of a given type
- This savings estimate will therefore be based on information about the fabric properties of that particular dwelling, and will also draw on data about standard energy use at a property of that kind, standard performance of energy efficiency measures, the geographical region, and a rolling average energy price
According to DECC’s consumer research (http://www.decc.gov.uk/assets/decc/11/consultation/green-deal/3586-green-deal-understanding-consumer-resp.pdf):
- While participants liked the cost of any energy efficiency improvements being covered by savings on their energy bills, they wanted reassurance over the level of the net saving, if they took out a Green Deal.
- A lack of a guarantee for the savings reduced interest in the Green Deal with 62% of participants saying it would make them less likely to take it out, of which over a fifth (22%) said it would make them much less likely
