Green Deal labelled ‘shambles’ after zero take-up
The Department of Energy and Climate Change’s (DECC’s) upcoming Green Deal has been described as a ‘shambles’ after the Minister for Energy and Climate Change, Greg Barker, revealed that zero UK householders have signed up to take out the energy-efficiency loans.
The lack of interest in the scheme has shocked many in the industry, as the application process has been open since 1 October and DECC recently offered homeowners up to £1,000 if they signed up as ‘early adopters’. It was hoped that up to 14 million people would sign up to the deal.
During parliamentary questions, Shadow Minister for Energy and Climate Change, Luciana Berger, asked Barker how many Green Deal assessments have been carried out since October 2012, to which he answered: “Green Deal assessments are completed when they have been conducted in the property and the results are lodged on the Energy Performance Certificate register, through software developed specifically for occupancy assessments. While we understand a number of appointments for the in-property assessments have been made, no assessments have yet been lodged on the register.”
Responding to the admission, Berger said: “These figures show the launch of the Green Deal is in tatters. The scheme had the potential to create thousands of jobs and help everyone lower their energy bills. Instead bungling ministers have squandered this opportunity by designing a scheme that is a bad deal for the public and doing nothing to promote it.
“This shambles will have real consequences for businesses across the country. The Insulation Industry Forum is predicting that 16,000 jobs will be lost this year because of a lack of demand for the Green Deal. Ministers should be ashamed if they allow thousands of people to lose their jobs this Christmas.”
The Green Deal, which was first announced in June of this year, encourages homeowners to take out low-cost loans to make energy efficiency improvements to their home. Householders can borrow up to £10,000 from private sector investor for the improvements, such as loft and wall insulation, which can then be repaid over a period of up to 25 years through energy bills. The responsibility is then placed on the bill player, rather than individuals, so would continue to be paid, even if owners change.
According to Barker, the deal hinges on a ‘golden rule’ that instalment payments will not exceed the savings on an average bill.
“Obviously, the golden rule can’t be a guard against a change in behaviour or lifestyle, but the products sold must deliver their technical potential and the savings estimates for all Green Deal measures have actually been revised down further, so are on the very conservative side, to err on the side of caution”, he said.
Barker went on to say that there will be a new Green Deal Ombudsman to guard ‘against mis-selling’ and protect the consumer. He also announced that DECC will be lining up a “major PR plan for 2013” to encourage more people to join the scheme when it goes live on January 28.
“The biggest push will come from the diverse range of Green Deal providers themselves”, Barker added. “This is a two decade project, we want steady growth through 2013 as the market gains confidence, systems are tested and new entrants gain confidence to roll out their models at scale.”
‘Coming alive’
A spokesperson for DECC added: “The Green Deal is coming alive and we are very pleased with the progress being made in advance of 28th January 2013, when the first Green Deal plans can be agreed.
“To ensure the Green Deal gets off to a flying start in January we recently announced a £125 million cash back offer to coincide with this date, which will see up to £1,000 available for households making energy saving home improvements under the Green Deal.
“People can register for a Green Deal assessment now, although we understand that assessments are generally being scheduled to take place closer to the date at which a plan can be signed and the work can begin – this makes perfect sense.”
Building companies shy away from Green Deal
Building companies have also reportedly been slow in signing up to be involved, with the official Green Deal register showing that just under 300 companies have so far signed up. Part of this reluctance to join the deal has been the ‘lack of clarity’ on the costs of assessments, as Green Deal advisors, Green Deal Consulting, have said.
‘With an upfront cost which could be in excess of £150, customers risk paying for an assessment that could lead to no benefit.’
Andy Wynter from Green Deal Consulting added: “I know I speak on behalf of other members of the industry when I say that I am growing tired with the lack of clarity on the matter.
“I have asked at meeting after meeting with the Department of Energy and Climate Change and Green Deal providers, typical costs of assessments and have met a blank wall, and once again those who are responsible have continued to skirt around the issue.
“It is outrageous that… people like the Energy Secretary are operating on guesswork. They should not be 'guessing' how providers will conduct the assessment process, it's absurd.”
According to the Federation of Master Builders, the UK’s biggest building trade body, only one firm from its 10,000-strong membership has signed up to become an accredited Green Deal installer.
Brian Berry, the chief executive of the Federation of Master Builders, said: “Only one building company [that is a FMB member] has signed up to become an installer out of 10,000 because that demonstrates the lack of a market.”
Speaking in reference to the government’s Energy Efficiency Strategy, announced last week, Berry added: “It’s becoming ever more apparent that the government’s Green Deal retrofit initiative is not going to deliver the transformational change that is needed which is why we need a range of incentives to promote energy efficiency.
“We are doing our bit to encourage small builders to equip themselves with the skills and training needed to compete in the energy efficiency marketplace, but they need certainty that the Green Deal will deliver the much needed business opportunities and that the government is fully behind the scheme.”
Read more about the Green Deal.
