Guest blog by David Thomas, The Eco Experts – Part I
A quick note from the Editor: With the Green Deal looming, it’s definitely time to take a birds-eye view of the ins and outs of the scheme, and indeed the kind of organisations involved in making it happen. With this in mind, when The Eco Experts got in touch with a view to blogging about just what’s involved , we took them up on the offer.
The UK’s 26 million homes are among the world’s oldest. Millions are crumbling, draughty, and 3m leak to the extent that they pose significant health risks. Without proper insulation buildings lose 70% of their heat through the roof, walls and floor. And as inefficient buildings bleed this heat, they haemorrhage cash.
Energy inefficiency is costly for everyone. It breeds fuel poverty in an age of rising energy prices, and it costs the Government millions in healthcare – £850m per year as a result of bad insulation – which leads eventually to higher taxes.
The facts speak for themselves:
A quarter of all homes could save up to £165 per year and retain 100% more heat with modern double glazing. In addition, three million of us – could save £105 per year by replacing our old, D rated boiler.
Individually, we can make significant savings. Combined, as a nation, in our generation Britain can save billions.
A financial initiative to retrofit the nation
Yes, this is a major issue for the UK but there could be an answer coming at the end of this year, called The Green Deal. Government doesn’t have the spare cash to spend on rejuvenating its housing stock, so is looking to the market for a helping hand.
The Green Deal will work as follows:
1 A financing scheme lending applicants up to £10k to improve their homes.
2 Repayments, made over 25 years, are intended to be less than the savings from the improvements. This is called The Golden Rule: “The expected financial savings must be equal to or greater than the costs attached to the energy bill”.
3 Green Deal repayments are linked to the energy bill and the property, not to the individual. Moving house means leaving behind both the energy efficiency advantages and the monthly debt.
The Energy Company Obligation (ECO)
A key industry figure is Paul Davies from Price Waterhouse Coopers, who played a major role in devising the Green Deal finance model, and in setting up the Green Deal Finance Company, along with 15 other accountancy firms. When asked what he felt the most crucial aspect of The Green Deal was, Paul answered, “the ECO”.
ECO is a grant: in place for low-income homes and for installations that improve comfort but don’t reflect as savings in energy bills. ECO is paid by Energy Companies, carried out by Green Deal Installers and is not repaid by customers. It’s estimated to be worth £1.3bn per year.