Landlords and tenants can now improve the energy efficiency of their home or business without any up-front costs, under a new government initiative called the Green Deal.
The deal aims to improve the energy efficiency of British homes and small businesses, which currently account for more than a quarter of the country’s carbon emissions. The idea is to provide financial support to those wishing to install new energy saving technology, or to improve harder to treat properties like older buildings or those with solid walls. Eligible purchases include condensing boilers, roof and wall insulation, draught proofing, ground source heat pumps and solar panels.
As part of the deal, consumers won’t have to pay anything up front, as long as the expected savings are equal to, or higher than the cost of the measure installed. If eligible, the loan is repaid gradually alongside the energy bill, at an interest rate of 7%.
The loan repayments should not exceed the stated lifetime of the product, and must not exceed 25 years. Importantly, the loan and repayment obligations are attached the house, so if the tenant or homeowner move, the new householder takes over the payments. Credit ratings will therefore have no impact on the likelihood of a successful application.
Although applicants may not be guaranteed direct cash savings, those in low-income housing will be able to install heating, for example, making for enjoyment of a more comfortable home. Tenants may also request improvements to be made under the Green Deal, which landlords must honour.
To receive support, applicants must register for an energy assessment by an accredited advisor. If the property and suggested measures are deemed eligible, finance will then be given to invest in energy efficiency improvements, which must be installed by a Green Deal endorsed team.
In a bid to generate more interest in the scheme, cashback of up to 50% of installation costs, up to a maximum of £1000 per household, is available in England and Wales, on a first-come, first-served basis.
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