North West Tenants & Residents Assembly Conference The Green Deal

Stephen Rymanstephen.ryman@decc.gsi.gov.uk

Green Deal Origins

•Through our ‘Green Deal’, we will encourage home energy efficiency improvements paid for by savings from energy bills. We will also take

measures to improve energy efficiency in businesses and public

sector buildings. The Coalition: our programme for government (May

2010)

Pay As You Save•Green Deal repayment – illustrative only

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UK Carbon Emissions

•“Our homes are responsible for a quarter of the UK’s carbon emissions, because they leak heat like a sieve. We use more energy to heat our homes than Sweden, where it’s seven degrees colder in January. We might as well be standing outside burning 50 pound notes”•Chris Huhne, Secretary of State

• Proportion of UK emissions from the buildings sector in 2009

What is the Green Deal?

• The customer receives a package of energy efficiency measures at no up-front cost from a ‘Green Deal provider’.

• The cost of the measures is paid back over the long term (for example, 25 years) through repayments made via energy bills.

• Not be structured as a conventional loan: the customer will not be liable for the capital sum, only the repayments whilst they occupy the property.

• The Green Deal will include owner-occupiers, the private and social rented sectors and the commercial sector.

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The Green Deal Process (1)

• Remote advice Centre• In home advice and assessment• Customer can shop around

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• No upfront cost• Repayments attached to energy meter

The Green Deal Process (2)

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• Accredited installation• Green Deal Code• Quality mark

The Green Deal Process (3)

Green Deal: Repayment (4)

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• Repayment up to 25 years

The role of the Energy Company Obligation

• There will be households for whom Green Deal finance is not suited

• ECO to integrate with the Green Deal, with a focus on:o hard to treat properties; and o vulnerable and poor

households

Energy Company Obligation

•Green Deal•finance

•ECO•Subsidy

• The next most cost-effective measures, combination of ECO subsidy and GD finance

• Measures fully meeting the Golden Rule

• Measures providing affordable warmth to the vulnerable

Green Deal & Rental Properties

• No upfront costs to landlords,• Overcomes the ‘split incentive’• Consent – who has to give consent and

when• Keen to learn from previous housing retrofit

models • What role could housing providers play?

• Green Deal Providers?• Partnership with GD Provider• Communicator 12

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Social Housing Case Study - Gentoo• Trialled Pay As You Save (PAYS) scheme,

• Held the ‘Green Debate’ a poll of 600 customers,

•New collaboration with British Gas will trial a Green Deal-style charge to pay for the energy efficiency retrofitting of around 650 social housing properties.

Timetable Green Deal & ECO legislation

DATE MILESTONE Winter 2011 Formal consultation on secondary legislation

Ongoing engagement with stakeholders

Early 2012 Secondary legislation laid before Parliament

Spring 2012 Detailed industry guidance prepared

October 2012 Green Deal legal framework launched