Green Deal Update 2013

  • Building Design Expert
  • 5 years ago

The fact that not really anyone knew much at all about the Green Deal back in September 2012 when they (DECC), to all intents and purposes cancelled the launch of this ‘ground breaking’ initiative, was very much in the governments favour. Doubtless a few beads of sweat were wiped from some deeply furrowed Whitehall brows when, with less than a week to go at the end of last September someone realised that we were actually short of one of the keys to unlock this pandoras box of lovelies; that of a funding mechanism. Looking on the bright side, it’s a good job someone actually caught it in time because egg on face is the devils own to remove once its gone cold.

So the weeks have ambled, or raced by, depending upon whether you are one of the Domestic Energy Assessors that invested anywhere between £1,300 and £2,000 in training fees for the privilege of calling yourself a Green Deal Assessor only to find there was no work to be had due to the seizure of the stop cock on the money supply pipe. 28 January 2013 is the date we have all been waiting for: Soft launch No. 2.

So what has happened over the last four months?

A few days before the first soft launch, back in September, I contacted some Energy Providers to see what they knew about the Green Deal and what they were offering. I drew a big zero on both fronts. If the energy providers were not at all prepared it leads you to a presumption that somebody somewhere had determined the Green Deal was not ready to happen. The fact that they waited until the 11th hour to tell the rest of the country is just perplexing.

It’s the day before the weekend before the day of the launch. I have contacted our energy providing colleagues again, and it seems someone has flicked a switch. The lights are on and the door is open. But now, for those that realise it, anyone who wishes to at least explore the GD are faced with a small dilemma of which energy assessor, and or which Green Deal provider to use.

With that in mind as of December 2012 not one household had registered to become part of the Green Deal. If you are surprised Ed, you need to ask yourself “How were they ever going to find out about it?”

Energy Assessors

The DECC web site makes it quite clear (if you read the small print) that you may have to pay an energy assessor a fee to come and assess your energy use and future requirements for savings. So there is your answer on ‘absolutely no upfront payments’ then. Although there will be perhaps larger organisations that may offer the energy assessment for free if you go ahead with your energy saving measures with them.

Any costs remain a little misty, but it seems these are going to be settled by market forces. They may eventually be offered for free, but for the moment the likes of British Gas are boldly placing neck on block and offering an assessment for a blanket charge of £99. Whilst I could not cover every other Assessors web sites, I didn’t find another that was prepared to do the same. In these early days they all want you to call them and ask.

I cannot help feeling that this is going to be a stumbling block for take up of the GD, and the assessment fee should have been funded by someone other than the home or business owner. Then of course assessors would be running around doing assessments on peoples whims. There is no short answer, but one cannot help feeling that the very audience that the GD is aimed at, those in fuel poverty, may just feel that they cannot afford the GD just at ticket price level.

Cash back incentives

Margaret Thatcher once said that managing the country’s economy is little different to managing a household budget. This government seem to have seized that one and are running with it. I once wrote a blog that included a somewhat tongue in cheek statement that Tescos do not do BOGOF deals on double glazing. Well I can possibly still hold onto that one, but we are getting perilously close to it happening.

Soon after the last blast off burned out on its launch pad, Ed Davey miraculously found £125m down the back of a Whitehall sofa, and he has kindly donated it to fund a cash back scheme to be offered to early adopters of any Green Deal measures. It ranges from £10 for hot water cylinder insulation, up to £650 for solid wall insulation. But don’t order your new golf clubs just yet. ‘Cash back’ is a euphemism for ‘voucher back’. The reality is a voucher to reduce the capital expenditure of the work being carried out. So effectively there will be less to pay back under the ‘golden rule’ payment calculation. Whether accumulated cash back can be used to offset additional work under the law of increasing diminishing returns, may depend on the property, the assessor, and or the Green Deal finance company. So we shouldn’t suck too hard on that sweet, not just yet anyway.

Oh, just a small point, but that £125m has got to last, so the currently published cash back figures are only likely to apply to the first £40m; then they go down. how do we know when the magic threshold figure has been reached? we don’t. We just have to learn to trust our Green Deal finance companies. Not sure about you, but I was always taught that trust had to be earned. So I supposed we will just have to trust that eventually they will – earn it.

It is reported, even by Ed Davey that the cash back scheme is capable of returning up to a £1,000 to any individual applicant. On paper yes. In practice it is unlikely that your combination of carbon reducing measures will provide the savings necessary to enjoy such a return. Nice try Ed, but I think you might have to get up a little earlier if you are going to try and slide another one like that by us.

Marketing

It’s no use having well defined cash back incentives and the ink dry on all the documentation unless the customer knows that there is something on offer, and indeed where the shop is!

At the time of the introduction of the Green Deal (last October) 90 – 95% of the population at large knew next to nothing about what the Green Deal is, what it is hoping to achieve, and even that it is available to Mr and Mrs average, on Average Street in Middle-town. Depending who or what you read this figure has improved, but we are only looking at 10% or so. The people who have most got to grips with the idea are the property owners and landlords who have a vested interest in making their buildings greener on the outside, because today that is what incoming tenants expect. It’s just good marketing. Mr and Mrs average, on the whole, remain blissfully unaware, and are likely to miss that cash back boat.

The DECC announced some months ago that were making available £2m for the purpose of promoting the Green Deal. This went up to £2.9m , and just last week they finally announced who would be responsible for coordinating the spend with imagination. Advertising agency – Carat have been appointed by the DECC, with a mandate to handle communications planning for a campaign to raise awareness of the new scheme.

There has to be a question mark over the timing of the appointment that allows nothing other than a standing start on day one. You would therefore conclude that to hit the ground running, after a pre-start campaign was carefully considered and then thrown out.

To the future

I would like you all to raise your glasses and toast the unrivalled success of the Green Deal. As much as I may have appeared to glibly report on progress to date; I sincerely hope and pray that the Green Deal achieves at least a large proportion of what it is setting out to. We need initiatives like this, and this one, for the moment is all we have got. So are we going to criticise the last breath out of it? or give it every bit of help we can. Until it either runs out of fuel or self destructs I would suggest the latter.

If we can get past the upfront cost issues in respect of the Green Deal Advice Report (GDAR), the next hurdle is ensuring the repayment costs work within the ‘Golden Rule’. In my mind, given sufficient time, this one will work itself out; if only because the price of energy is going to increase and keep on increasing. This will create it’s own golden rule buffer zone. Add this to the one built in by the energy assessor, and the old nag just became the hot favourite. I wish you well Green Deal. “Let the Games begin”.

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