Prepare for launch: DECC seeks to seal the Green Deal

Following the consideration of more than 600 responses to the consultation on the Green Deal and ECO, Government has today set out secondary Green Deal legislation. The changes to the original proposals include measures to strengthen consumer protection, reduce industry burdens, and to implement the Energy Company Obligation (ECO).

The Department of Energy and Climate Change (DECC) plans to cement the Green Deal and ECO rules by October this year, including, in legislation to be laid later this week, ensuring support worth around £1.3 billion a year to deliver energy efficiency and heating measures across Great Britain.

Government’s aim is to increase the energy efficiency of residential and business buildings across the UK.

Announcing the news the Energy Secretary and Climate Change Secretary, Edward Davey, said: “Today I have published the Government’s detailed plans along with legislation that will allow the industry to bring the Green Deal into existence. The Green Deal will play a huge role in improving the energy efficiency of our homes and businesses, with ECO making sure that the most vulnerable homes benefit too.

“We have listened very carefully to what industry, consumer groups, and other organisations have told us. Broad support for a managed, tested and careful introduction of the Green Deal fits exactly with our objective to provide an excellent customer experience from day one and a market where a range of new players can readily participate.

“I am determined to make sure that, in addition to creating huge opportunities for Green Deal providers and businesses along with thousands of new jobs, this new market in energy efficiency will deliver the very best deal for consumers.”

What’s new?

One of the largest concerns surrounding the rollout of the Green Deal was the lack of consumer protection and the burden the policy would place on businesses. DECC’s revised version of the policy will place restrictions on ‘cold calling’ and implement new rules requiring Green Deal Assessors to declare any commission they might be receiving for carrying out an assessment and any ties to Green Deal Providers.

There will also be a change to the original warranties proposal. The latest version eases the requirements on businesses to hold warranties for the length of a Green Deal Plan while maintaining robust minimum standards of protection for consumers.

Changes have also been made to the ECO to include allow more hard-to-treat cavity walls to qualify for support, and to provide specific support for low income and rural areas. An estimated technical potential of around 2.8 million hard-to-treat cavity wall properties will now be eligible under the ECO.

The Green Deal framework will consist of assessors, installers and Green Deal Providers, all of which should be ready to start work in the autumn of this year. From August accredited certification bodies will be able to submit applications to register with the Green Deal Registration and Oversight Body, and will then be able to register assessors and installers as ‘Green Deal Approved’. Potential Green Deal Providers will be also able to apply for approval.

Today’s announcement also includes a final impact assessment and associated research, and confirms the appointment of Ofgem to be the ECO Administrator. Government will shortly announce the contract awards for the Green Deal Registration and Oversight Body and the Green Deal Ombudsman and Investigation Service function.

In response to the news Garry Worthington, Head of Green Deal at Climate Energy, said: “This response has been greatly anticipated, and we expect it to answer some of the questions surrounding the future of energy efficiency in the UK and will help us to further progress with our plans to become a Green Deal provider, as well as helping local authorities and regional organisations move ahead in terms of designing and implementing regional and local schemes.

“The improvements to the consumer protection elements of Green Deal are particularly welcomed.  These new safeguards, along with the plans to calculate savings on a daily rather than annual basis, will go a long way in encouraging homeowner and tenants to take advantage of the finance available for energy efficiency improvements. 

“However, we are disappointed that the Government remains undecided about its £200m fund to kick-start the scheme.  We think the current plans to use this purely as a cash-back incentive over the next two years are mis-guided and that could be used much more creatively to support regional schemes, local innovations, jobs, communities and delivery to give take-up an initial boost.  We would also urge DECC to reconsider its support around promoting Green Deal and creating awareness of the scheme.”

Rhian Kelly, CBI Director for Business Environment policy, said: “Having more details on how the Green Deal will operate on a practical level is an important step for a scheme that has the very real potential to cut costs for consumers and businesses in the long run, and help generate business investment and jobs.

“However, there is still plenty of work to do. With the launch of the Green Deal expected towards the end of the year, Government needs to move quickly to put everything in place. It must ensure that businesses who want to get involved are in the best position to do so and put the right policies in place to stimulate consumer demand.”