The non-domestic Green Deal will open up new routes of finance for factories, schools, warehouses, and offices
for non-domestic property owners. ‘There’s a lot of explaining to people
GREEN DEAL: IN-DEPTH
The Green Deal was first launched in the UK on October 1 2012 and went live on January 28 2013.
It aims to reduce UK carbon emission output and reduce the national demand for imported gas supplies by offering consumers funding for property improvements.
The Green Deal is a key government policy to enable building owners and operators to install energy efficient improvements to buildings at no upfront cost to the owner or operator. Instead a finance package will be offered to the building operator and will be repaid by being charged to the operator’s energy bill over a specific period.
As the costs of the installation is added to the electricity bill, the estimated savings on the total energy bill will always equal or exceed the cost of the work; otherwise the improvements will not qualify for Green Deal finance. (Also known as the Golden Rule of the Green Deal plan).
However under the Green Deal plan, the liability for the payments remains with the building, and does not follow the owner or occupier after they leave the building.
that needs to be done about what the Green Deal is and how it works,’ says Hipkiss. ‘Unfortunately, most of DECC’s communications have been about the domestic Green Deal, so there’s not a great deal of information that goes into the complexities of non-domestic buildings.’ Non-domestic buildings are much more complex than homes because of their ownership structure and maintenance requirements, and the scale of the engineering systems that they may contain. Another barrier, cautions Hipkiss, is the
amount of disruption some energy efficiency measures could cause to a non-domestic building occupier. He recently completed a survey for one office that had been merged with two others, so it was effectively using three heating systems. The recommendation was to merge those systems and put one system in its place, at much disruption to that business. This is why, says Hipkiss, it’s vital that the non-domestic Green Deal is not sold as a quick fix: ‘It needs to be recognised that this is a good option, but not a quick option. ‘There needs to be more effort in communication around the non-domestic Green Deal to make it work; it’s not just a quick route to get heat pumps or solar panels.’ And, despite Hipkiss suspecting that property owners who pay for their survey will take it more seriously, he also recognises that the fee itself could act as a barrier, with surveys for non-domestic buildings costing anything from £500 to £2,000. However, Geens pointed out that one of the differences between the domestic and non-domestic sectors is that commercial clients are more accustomed to paying for professional consultancy advice
22 CIBSE Journal May 2013
when refurbishing their buildings. Patrick Bellew, founding director of
Atelier Ten, agrees that the principal barrier to take up by small- and medium-sized enterprises (SMEs) will be the initial survey fee – something he heard has already been a problem in the domestic sector. He suggests that the consultant could take
a punt and pay for the assessment to be done, but adds: ‘The cost of sales to us is very high if somebody doesn’t proceed.’ Bellew, who is currently sitting on the
All Party Parliamentary Group inquiry into sustainability and the Green Deal, says that of the 9,268 assessments conducted to the end of March – in both the domestic and non- domestic sectors – none have yet translated into a loan. ‘It’s going to take time.’ Bellew added that, from a consulting engineer’s point of view, opportunities are out there, but he questions whether it will be worth a large firm’s time pursuing them. He explains: ‘The design and build
sector will be scrapping over the relatively limited market that exists at the moment. And it’s whether one would want to pursue opportunities on existing buildings. It’s difficult to imagine a large professional firm trying to hunt down this work because the cost to us would be quite high. ‘To find a Green Deal project we have to
go and search for clients who want to do something to their building, persuade that client they want to hire us to carry out the assessment or get an assessor in, and try to extract fees for designing the system. Then they have to get the Green Deal loan.’ He also stresses that its success and ultimate
appeal to property owners will depend on whether Energy Performance Certificates (EPCs) are used as a driver for building value.
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