Homeowners and landlords who wanted to cut energy bills but could not fund the work upfront had a new option. From 28 January 2013, the first finance plans under the Green Deal became available. The scheme was set up under Part 1 of the Energy Act 2011.
How it works
- A Green Deal assessor visits and recommends improvements, such as insulation, heating upgrades or glazing.
- A provider offers a finance plan for the work.
- The cost is repaid in instalments through the electricity bill for the property.
The scheme is built around a “golden rule”: the expected savings on bills should be at least equal to the repayments. Because the charge sits with the property’s electricity bill rather than with the person, it stays with the building if the owner sells or a new tenant moves in, and it must be disclosed.
Points to weigh up
- Interest. Compare the cost of finance with other ways of paying.
- Estimated savings. Savings are based on typical use, not your actual use, and are not guaranteed.
- Sale and letting. A buyer or tenant will inherit the repayments, which may affect negotiations.
- Leases. In flats, work to the structure or the outside usually needs the freeholder’s consent.
Check the building, not just the bill
Energy measures that suit a modern house can cause trouble in an older one. Before committing, ask:
- Solid walls. Older brick and stone walls manage moisture by letting it evaporate. Some internal and external insulation systems can trap moisture, leading to damp, mould and decay.
- Cavity walls. Filling a cavity in a building exposed to driving rain, or one with defective pointing or blocked cavities, can carry water across to the inner leaf.
- Ventilation. Sealing draughts without providing controlled ventilation can lead to condensation.
- Listed buildings and conservation areas. External insulation and new windows may need consent.
A short independent survey before you sign can show whether the building is ready for the measures proposed, and what repairs should come first.
Our Building Surveys and Defect Diagnosis service gives that independent view. See our damp and moisture investigation of a London block, and how we approached a communal heating feasibility study.