The original Green Deal scheme closed in 2015, but you can still get loans for energy-saving home improvements through the Green Deal Finance Company. Find out whether a Green Deal loan is right for your home, about changes to the scheme and how they affect existing Green Deal loans, plus how else you can pay for home improvements.
The Green Deal was a government scheme that provided loans to households to finance energy-efficient home improvements. The loan was designed to be paid back through the savings made on energy bills.
The original scheme ran from 2013 to July 2015, when the government stopped supporting the Green Deal Finance Company. Some private companies continue offering Green Deal loans, however.
In 2017, the Green Deal Finance Company began offering loans for selected energy efficient home improvements again, backed by private investors.
Read on to find out more about the current scheme. If you already have a Green Deal loan, find out if you can pay it back early and if Green Deal home improvements are under warranty. Plus, what to do if you're selling your home and have a Green Deal, and how to switch energy supplier.
Before you consider a loan to make your home more energy efficient, try these simple and cheap things to save money and energy at home. Start with a water-saving shower head or keep track of your heating with a .
Green Deal loans are a way for homeowners to fund energy efficiency measures in their home and pay them back through their energy bills.
Loans are currently available for the following home energy improvements:
The original Green Deal scheme was government-funded. Now the Green Deal Finance Company (GDFC) is backed by private investors.
The Green Deal Finance Company said that the main changes compared with the previous scheme are:
Green Deal loans work differently to a loan from a bank or other credit provider:
The National Audit Office conducted an independent audit of the Green Deal scheme. Its findings were published in April 2016 and found that, during its lifespan, the Green Deal loan scheme only funded 1% of energy efficient measures installed through the Energy Company Obligation (ECO) and Green Loans scheme combined.
It also found that the scheme saved only negligible amounts of CO2 and that households did not see these loans as an attractive proposition.
If you want a Green Deal loan now, you need to find a registered Green Deal provider – search on the . Before you sign up to a loan, make sure you carefully research interest rates, as well as the terms and conditions of the loan, to make sure they suit your needs. This scheme isn't available in Northern Ireland.
However, there are other ways you can finance home improvements if you'd rather not get a Green Deal loan.
If you're looking for financial support to make energy efficiency improvements to your home, a scheme called the provides support to low-income and vulnerable households for energy efficiency home improvements.
There are other ways to pay for improvements to your home and make it more energy efficient:
As a result of Which? campaigning, the Green Deal Finance Company announced it was removing any early-repayment fees for loans issued after May 2014.
If you took out a Green Deal loan before this date, you can still pay it off early but may incur a fee. If you took out a Green Deal loan for less than £8,000 over 15 years or less, there are no early-repayment charges.
For some providers, early-repayment fees will be small when the Green Deal plan duration is 15 years or less and more than £8,000 (up to a max of 1% of the loan). But for a Green Deal longer than 15 years, there is a maximum charge of £6 for each year left on the loan for every £1,000 you want to repay early.
Most Green Deal measures came with a minimum five-year warranty and an extended 10-year guarantee to cover any building damage sustained as a result of the measures being installed. For solid-wall insulation and cavity-wall insulation, Green Deal providers must have guarantees for both the improvements and consequential building damage for 25 years.
Should you have a problem with a product after the warranty has expired, you will still be paying for a non-functioning product and will have no protection.
The existence of the Green Deal must be disclosed to the buyer. If the buyer of your home does not feel comfortable taking over the Green Deal loan, they might want to renegotiate the terms of sale or you could consider repaying the Green Deal off early as part of your conveyance. However, we haven't yet come across any cases of buyers being put off.
If you have just moved into a house with a Green Deal attached to it, the person who pays the electricity bill pays the money back. So if you’re a tenant in a rented property, you’ll be paying back the costs – not the landlord. This is because the tenant can expect to benefit from lower energy costs.
If you move into a property with a Green Deal, the landlord or seller must show you a copy of the Energy Performance Certificate – this will explain what improvements have been made and how much you’ll need to repay.
In most cases you can still switch energy suppliers if you have taken out a Green Deal, as all of the big providers (British Gas, EDF, Eon, Npower, Scottish Power and SSE) were part of the scheme. There are a handful of small energy suppliers that you can't switch to if you have a Green Deal, so check before switching.