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Green Deal is set to be a great success!

Posted by Adrian Wright on 5 July 2012 at 11:03 am

Sorry! I had to start the blog with a positive title about Green Deal in the hope that it may make it into my daily "green deal" Google alert email to counter all of the depressing negativity that usually fills the headlines.  

Every man and his dog has jumped on the ‘bash the green deal’ bandwagon and you can’t open a paper without being told how green deal is going to fail. Only last week I read a story about a BSI survey that found that "only" 1 in 5 people say they will go ahead with green deal. Personally I think that is a fantastic result for a scheme which hasn’t started yet and which householders are yet to have publicised to them.

Obviously these things take time to gather momentum so, just for once, can we all please try and stay positive and at least give the green deal a chance?  

The truth is, the green deal is just the sale of home improvements to householders with a fancy finance mechanism and £1.3billion of ECO grant funding a year thrown in to sweeten the deal. Companies have been successfully selling home improvements for decades and with the bells and whistles that Green Deal has added, why do people think that it will be a failure? Green Deal success will be driven by the likes of Green Deal Providers like Enact Energy, community groups and local authorities who promote it. Companies cannot expect to have work flood in through their doors just because Green Deal has started, they will need to work hard to let consumers know about their products and stimulate them with a compelling sales message to get them to part with their cash, just as they do with products like solar and double glazing now.

It was disappointing to hear that the first green deal plans can’t be signed till the end of January and that the Green Deal Finance Company (GDFC) could take till as late as April or May 2013 to be properly established and financed. However, ECO starts in October this year offering large grants mainly for solid wall insulation and "hard-to-treat*" cavities. Householders willing to part fund works through other finance mechanisms outside of Green Deal can go ahead from October and for those on qualifying benefits, the works may be free. Several million households also have one last chance to get completely free loft and cavity wall insulation during the last six months of the Carbon Emission Reduction Target. Have you applied for your free insulation yet?   

As a DECC Pioneer Green Deal Provider, Enact Energy is gearing up for the start of Green Deal and we have already launched a dedicated website www.greendealpartnership.com to support local councils, SMEs and community groups. On a personal level, I can’t wait to get my old, Victorian, oil-heated, windswept home in Cornwall wrapped in external wall insulation to make it warmer, cut our fuel bills and better still, no more having to paint the walls! So come on press and industry, stop the knocking and can we please look forward to Green Deal in a positive way? 

*A "hard-to-treat" cavity has been defined as a cavity less than 50mm wide, a block of flats more than 3 storeys high, prefabricated concrete or steel built homes and homes with an outer cavity built of stone (not just clad in stone).  

Photo by Steve Johnson

 

About the author: Adrian Wright has more than 20 years experience in the energy efficiency industry and acts as a consultant to Enact Energy.

If you have a question about anything in the above blog, please ask it in the comments section below.

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Comments

5 comments - read them below or add one

NorthGlosEPC

NorthGlosEPCComment left on: 5 August 2012 at 10:45 pm

adrianenact and Tim,

I can see the practical attraction of training your own GDA's but be careful. Although I'm sure you are honest and fair not all GDP's will be. GDA's tied or linked in any way to a GDP may end up becoming sales people rather than fair honest and impartial advisors.

Are we looking at the next big mis-selling scandal?

Will this or something like this destroy any possibility of the Green Deal achieving credibility with the public?

I think completely independant GDA's should be the rule.

Besides this issue the Green Deal itself has in my mind a few other question marks hanging over it anyway. I'm not at all yet convinced that in it's most current form it is all going to happen as it should.

Right now my tendancy is to somewhat agree with Nick Hannan. The way he puts it is "it will be a train crash". I think the train just won't leave the station.

But, the muppets in Government still have a few months to get it right, I'm not too confident they will but let's hope they do.

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@adrianenact

@adrianenactComment left on: 16 July 2012 at 1:09 pm

Hi Tim

Thanks for your question.  I believe that you are right to be considering training up your own GDA and in addition to carrying out assessments for your own products I am sure you could pick up work assessing for others if that is what you are planning to do?  I don't think the market will be solely driven by the big players but if the big players do start offering free assessments then my opinion is that it will kill the market for assessors who want to offer a completely independent unaffiliated service.  Whilst I do see the value in an independent assessment I also believe that we need to consider the main aim of this legislation which is to get homes upgraded and save energy.  If companies, big or small, are good at generating interest and then converting an assessment into a sale then we have achieved the goal.  A lot of people just want things kept simple and a one-stop-shop solution can take the hassle out of Green Deal for a consumer.  That said, it is vital that all assessors, tied or independent, are strictly monitored to prevent inaccurate or misleading assessments and then it is down to the customer to decide if they trust the company to deliver a good service at a competitive price.

As you can see above, we (Enact) have launched an umbrella service to help smaller business to access all of the elements of Green Deal that they are unable or don't wish to provide www.greendealpartnership.com . In your example, if you carried out the assessments and installed PV and thermal, we could register the Green Deal Plan, provide finance and offer the customer any other works if required which may include ECO funding leaving you to install the PV and thermal if the customer wishes to go ahead with those works.  There will be a number of other models like this and you may be happy working with us or a different model may suit you better, either way a partnership with a Green Deal Provider will be essential for you unless you plan to become one yourself.

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TimLynam

TimLynamComment left on: 16 July 2012 at 10:23 am

As an independent MCS PV & Thermal installer, I am looking at developing my business as a Green Deal Advisor. What are your thoughts about the role of independent GDAs for domestic & non-domestic. Will the market simply be driven by the 'big-players' using Energy Assessors and Sales Advisors?

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@adrianenact

@adrianenactComment left on: 14 July 2012 at 4:10 pm

Hi Nick, this was discussed in the Commons last week and Greg Barker made it clear that companies can only charge what is reasonable to cover actual losses or costs.  The main issue is that for any financial institution to lend money at a fixed rate for up to 25 years, they in turn will need to borrow at a fixed rate and there will inevitably be penalties for them if they repay early and these will be passed through to the customer.  This could mean in a worst case scenario that the actual penalty incurred by the lender could be that they have to pay off the full interest for the 25 years even though the money is repaid early and this then in turn will be charged to the householder.  Each lender may have different criteria and therefore people should bear this in mind when taking out a Green Deal loan.  That said, I don't think there will be many options to start with other than the Green Deal Finance Company so shopping around for finance may not be a simple option.

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Nick Hanna

Nick HannaComment left on: 5 July 2012 at 9:09 pm

Hi Adrian, yes many of us working at the coalface with local environment groups would like it to be a success - Greg Barker opened the Energy Advice Centre in Bexhill last Friday and as a Director I was there listening to him bigging up the Green Deal but unfortunately I totally missed the opportunity to ask him this - as a consumer I am very interested in more energy efficiency improvements to my home, but I heard that if you repay the loan early there will be huge penalties. End of my interest in the Green Deal. This is just one reason why some of us believe it will be a train crash. Any ideas on that one? 

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