What is the Green Deal?

The Energy Bill introduced to Parliament includes provision for the new "Green Deal" as part of its ambitious targets to reduce carbon emissions in the UK by 80% before 2050. A revolution in energy efficiency for UK homes and businesses.

"We are launching a revolution in energy efficiency" - Secretary of State for Energy and Climate Change.

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The Green Deal

Tell me more about the Green Deal..

The UK needs to become more energy efficient in order to reduce its greenhouse gas emissions which contribute to dangerous climate change and has already committed to achieving a 34% reduction in carbon emissions (compared to 1990 levels) by 2020.

In order to achieve these targets, the Government has set legally-binding carbon budgets across all sectors of the UK economy including our homes, communities and workplaces. Reducing the demand for energy and eliminating wasted energy is one of the most cost effective ways of reducing carbon emissions. To do this we all need to make our homes, communities and workplaces more energy efficient and we need to look for lower carbon sources of heat, power and lighting.

"Millions of homes and businesses could benefit from improvements under the Green Deal."

- Secretary of State of Energy and Climate Change

Why is the Green Deal and ECO needed?

At a local level, the Green Deal will enable many households and businesses to improve the energy efficiency of their properties so less energy is consumed and less money is wasted. The key focus of the new energy company obligation – or "ECO" will be on those householders who cannot achieve significant energy savings without an additional or different measure of support. For example, this includes vulnerable and low-income households and those living in harder to treat properties, such as solid walled properties. A quarter of the UK's carbon emissions comes from the energy used in homes and a similar amount comes from our businesses, industry and workplaces.

At a national level, the UK needs to become more energy efficient to reduce its greenhouse gas emissions, which risk dangerous climate change. The Climate Change Act 2008 legislated for a reduction in our carbon emissions and set legally-binding carbon budgets across all sectors of the UK economy — including our homes and communities, and our workplaces.

What happens next?

The role of the Green Deal provider is to offer a Green Deal plan to customers, which enables them to finance work recommended by an accredited adviser and undertaken by an accredited installer. These functions might be done in-house by the provider, or shared amongst other organisations, but the customer's contractual relationship is with provider.

One of the prerequisites for a Green Deal plan will be for the consumer to have a property assessment by an accredited adviser. High quality, standardised, trusted advice on energy efficiency is essential to the success of the Green Deal.

The adviser would visit to assess the energy performance of the property and advise on the relevant opportunities for energy efficiency improvements. They might also make recommendations on energy-saving behaviour.

What is the Golden Rule?

The key principle, or golden rule, for accessing Green Deal finance is that the charge attached to the bill should not exceed the expected savings, and the length of the payment period should not exceed the expected lifetime of the measures. This is not a government guarantee, but a guideline for customers that, typically, they should be able to expect to gain more efficient, less wasteful properties with no additional net cost from the Green Deal.

Quality Assurance

The Green Deal quality mark will protect consumers from rogue traders falsely claiming to offer a Government approved service to consumers. Any Green Deal adviser or installer will have to display this mark to demonstrate that they comply with the relevant requirements. The mark will not be a marketing brand logo and is not designed to promote Green Deal or convey its properties or values to consumers; instead it would simply be an emblem displayed by certified bodies in the supply chain. This would play a similar role to existing marks such as Gas Safe and Trustmark.

Our draughty homes are poorly insulated, leaking heat and using up energy. As consumers, we pay a high price for inefficient housing – and so does the planet.

- Secretary of State of Energy and Climate Change

Green Deal
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