In another blow to the UK government’s Green Deal energy efficiency scheme, a survey conducted among 2,070 adults from across the country has found that 46 percent would want a Green Deal loan paid off before they would consider buying a property. The survey also found that a fifth would reconsider buying a property that had a Green Deal loan attached to it.
The government energy efficiency scheme was launched at the end of January 2013 amid widespread speculation concerning its chances of success. The scheme is essentially a market-based attempt by the government to do something about the UK’s lamentable record on domestic energy efficiency, particularly with regard to loft and cavity wall insulation. In 2010 around 27 percent of the UK’s carbon emissions came from the domestic housing sector. According to 2012 figures released by the Department of Energy & Climate Change (DECC), 30 percent of all homes with cavity walls remain untreated rising to 97 percent among homes with solid walls. Among houses with lofts, 35 percent do not have any loft insulation.
Despite some initial positive signs, the popularity of the Green Deal is already beginning to fade. Earlier this month, John Sinfield, managing director of Knauf Insulation commented that the scheme has been strangled at birth by a complete lack of any real incentive to encourage uptake among householders. His warning came after figures revealed that only 2,031 more Green Deal assessments took place in April than in March.
“If this rate of activity evens out at 10,000 assessments a month it will take 116 years to reach the original DECC aspiration of tackling 14 million homes” Mr Sinfield added, “and that assumes an optimistic 100% conversion rate from assessment to Green Deal. At a more realistic rate of 50% it will take 232 years to achieve this goal!”
The scheme provides homeowners with a loan to install energy efficiency measures such as insulation and double glazing, which is then repaid through energy bills. However many in the industry have criticized the debt-based structure of the scheme as a potential disincentive. The scheme’s “Golden Rule” means that, technically, customers should not pay more in loan repayments than the amount of savings made on energy bills, but this means, depending on the value of the work carried out, that consumers could spend around twenty five years repaying the loan.
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