Green Deal works D
How the Targeted at improving energy efficiency in homes and small
businesses, the government’s Green Deal initiative also offers big opportunities for the electrical contracting sector. So what’s the big deal? Paul Reeve, the ECA’s head of Environment, explains
The scheme is about saving money by reducing energy use in buildings
uring 2011, the Department of Energy and Climate Change (DECC) will push on with its hugely ambitious plans for the ‘Green Deal’ private sector loan scheme. The scheme aims to
boost the energy efficiency of millions of homes and smaller commercial properties between now and 2020. However, a huge amount of work remains before the first Green Deal offers become available, possibly by autumn 2012. To understand how – and, indeed, whether – the Green
Deal will work, we should note that the scheme is about saving money by reducing energy use in buildings. ‘Between two and three billion pounds’ worth of energy is wasted annually because our homes are poorly insulated and inefficiently run,’ says Chris Huhne, the coalition government’s Secretary of State for Energy. Note, there is no reference here to reducing carbon emissions: that will be a welcome spin-off from making energy savings, but it is not the key measure of success (see the box ‘A word about carbon’).
Golden rule The emphasis on energy and money is firmly underlined by DECC’s Green Deal ‘golden rule’ – that is, savings in bills after using up-front ‘green’ loans to install energy saving measures will exceed the loan repayments added to those bills. The repayments will be added to the customer’s basic energy bill, the tariff for which is widely expected to rise considerably in future. With energy costs on an upward curve, saving energy will be an increasingly attractive proposition for many home and business owners. Overall, the ECA is a firm supporter of the Green Deal,
though it’s fair to say that the Green Deal is still ‘work in progress’, and much of the important detail is still missing. However, the government says that the scheme is intended to involve the following:
18 ECA Today July 2011
Advice – All households – and smaller businesses- in-scope – will be entitled to an energy efficiency assessment, from a suitably accredited assessor. Finance – There will be a finance mechanism that enables the cost of installed energy efficiency measures to be paid back via the customer’s ongoing energy bill. Installation – Accredited installers ‘will install measures to the highest standard’, to ensure that the energy efficiency measures deliver genuine energy savings, and that consumers have confidence in the advice, products and services they receive. Repayments – After energy efficiency improvements have been installed, a charge will be added to the energy meter at the property. This charge will enable the occupier to repay up-front Green Deal finance, via their energy bill. The repayment obligation will stay with the property and it will transfer to any new occupier.
Energy-saving measures So far, Green Deal aficionados have had plenty to say about ‘passive’ measures involving insulation, walls and windows. Some of these measures will make significant contributions to energy efficiency, but the ECA and others have been actively putting forward the value of ‘active’ measures such as lighting, sensors and low-cost energy management (see box: ‘Active energy saving measures’). It is a myth that all passive measures provide a better
return on investment than active measures. While some passive measures have a payback of 10 years or more, we have highlighted ‘active’ measures that offer much shorter paybacks. As such, we advocate that various active measures meet DECC’s ‘golden rule’ and merit early inclusion in the Green Deal. These measures include: i) Replacement lighting using efficient luminaires and controls, including LED replacement;
SHUTTERSTOCK
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