The Green Deal Initiative is about helping the consumer, domestic or business, to be able to afford to undertake energy efficiency measures. Consumers will be free to afford to pay for the works upfront, in whole or in part, but under the Green Deal also to repay the costs through the energy bills and spreading the costs.
Green Deal – The Golden Rule
The Green Deal Golden Rule for accessing the Green Deal Finance is that the cost of the improvement works should not exceed the expect savings.
Additionally the length of time that it takes to pay back the cost of the measure should not exceed the lifetime of the measure itself.
This is not a guaranteed, but a guideline for customers that typically they should be able to be more energy efficient at no additional cost. In addition the consumer will be offered advice to further reduce their energy consumption.
Green Deal Financing
Once an assessment has been done on the property by a qualified Green Deal Adviser which makes recommendations as to potential areas of improvement, it is envisaged that an approved Green Deal Provider would evaluate the package of measures recommended and make an offer which is based on the total costs. This is the charge to be attached to the energy meters of the property and shows the length of the repayment period. Only eligible energy efficiency measures and installers who are qualified under the Green Deal Provider scheme will be eligible for finance done in this way.
Consent, Repayments and the Future
Both owners and tenants of a property are eligible to take out Green Deal Finance, but they will need to obtain express consent from all parties that have an interest in the property, including any landlords, ahead of the measures being installed. The express consent of the energy bill payer will be required.
Although not a traditional loan or finance, it is likely to count as a fixed term credit arrangement and will therefore fall under the Consumer Credit Act 1974. This means Green Deal Providers should have a Consumer Credit Licence before they can operate.
The presence of a Green Deal Finance scheme must be disclosed to any future occupier of the property, such as a tenant or owner.