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					The Green Deal

Ian Trim
Team Leader, Green Deal Provider Markets
Department of Energy and Climate Change
 Drivers for Action
 International commitments:
    Kyoto
    EU 2020
 UK Climate Change Act:
    At least 80% cut in GHG emissions by 2050
    34% cut in emissions by 2020
 Carbon Budgets:
    29% cut in non-traded emissions from homes by 2020
 Energy Security, Fuel Poverty and Low Carbon jobs.



                                                          2
26 Million Homes
                       3%                       Energy use in British homes
                                                      Space heating
                 15%
                                                      Water heating

                         56%                          Lights & appliances
              26%
                                                      Cooking




“Our homes are responsible for a quarter of the UK’s carbon emissions, because
they leak heat like a sieve. We use more energy to heat our homes than Sweden,
where it’s seven degrees colder in January. We might as well be standing outside
burning 50 pound notes”
70% of homes in 2050 are standing today
                            Profile of Energy Performance in Existing Dwelling Stock (2004)

SAP 2001
                   86+      71-85      56-70      41-55     21-40           1-20
Ratings
       High performance                                                      Low performance
                                                                                          Number of
              0%          20%          40%           60%              80%         100%
                                                                                          Dwellings   40% of existing stock is pre-
   pre 1919                                                                                 4.4 m     1944, with mostly solid walls,

 1919-1944
                                                                                                      which are hard to treat
                                                                                            3.6 m
                                                                                                      buildings
 1945-1964                                                                                  4.2 m

                                                                                                      Step-change post-1990:
 1965-1974                                                                                  3.1 m
                                                                                                      Increased efficiency of homes
 1975-1980                                                                                  1.3 m     post-1990 mainly thanks to:
                                                                                                      - Building Regulations
 1981-1990                                                                                  1.8 m
                                                                                                       (1991, 2001, 2006)
  post 1990                                                                                 1.8 m     - Energy Efficiency Commitments



  Source: Based on English House Condition Survey (EHCS) 2004, DCLG
Delivering our Commitments
                 Legal target to reduce carbon emissions by 80% by 2050
                Households will need to reduce emissions by 29% by 2020

      The Government is helping people play their part in making homes greener :


                                      Introducing the
                                         Green Deal
Extending the     Introducing a
                                           helping        Clean energy
   Carbon         new Energy
                                      householders to       cash-back       Rolling out Smart
 Emissions          Company
                                     pay for measures    schemes such as          meters
 Reduction       Obligation post
                                       through saving     Feed-in Tariffs
   Target              2012
                                      on their energy
                                             bill
The Green Deal

“Through our „Green Deal‟, we will encourage home energy efficiency
  improvements paid for by savings from energy bills. We will also
  take measures to improve energy efficiency in businesses and
  public sector buildings.”

  The Coalition: our programme for government (May 2010)
   What is it?... In one slide
 A regulatory framework enabling companies to offer householders:
    accredited advice and recommendations
    home energy efficiency improvements at no up-front cost
    much easier, co-ordinated offers (one point of contact)
    reassurance that work is of a high standard
    the ability to pay via energy bills over the long term (for example, 25 years),
     making use of the money saved on fuel
    only to pay whilst they remain in that property
    to avoid conventional loans with the risk of defaulting on the entire sum
Green Deal Process




                                      Repayments
Assessment   Finance   Installation    and follow
                                          up




                                                    8
                                                    8
                   Assessment

 All households entitled to an energy efficiency
  assessment as part of the Green Deal
 Accredited independent assessor produces a fabric and
  behavioural assessment
 Standardised, accredited assessment – uses agreed
  methodology
 Consumers can shop around after receiving advice




                                                          9
                 Finance
 New mechanism attaching payment obligation to the energy meter
 No upfront capital required from the property owner
 Consumer is responsible for payment whilst they consume energy
  at the property but not after they move out
                   = Not a conventional loan




                                                                   10
                     Finance (cont.)

 Consumer protections
    Golden rule that likely bill savings must be larger than payments
    Accreditation – only approved measures by accredited installers following
     accredited assessment
    Green Deal must be disclosed to future owners / renters of the property
    Appropriate consent must be sought before Green Deal is taken out on a
     property
    Adaptation of Consumer Credit Act protections
    Existing regulatory regime for collection of energy debt extended for
     Green Deal – including protection for vulnerable consumers



                                                                                 11
                  Finance (cont.)

 Private sector finance
    Discussions with numerous financial institutions underway
    Need to be able to access capital markets for lowest cost




                                                                 12
                   Installation

 Green Deal will require standards and accreditation for
  products and installers
 Installer will need to:
    meet certain standards to practice under the Green
     Deal
    carry the Green Deal kite-mark/ logo
    sign off work once complete and inform GD Provider
     that repayments can begin



                                                            13
                 Repayments and follow up

 Payments will be collected through energy bills with the Green Deal charge
  shown as a separate line on the bill
                                   • Customer is free to switch energy
                                       supplier – no change to current
                                       procedures
                                  • Provision will be made for long term
                                    vacancy, early repayment, demolition,
                                    etc.
                                  • Redress and disputes processes


                                                                          14
 Timetable for Green Deal

 December 2010 – Bill introduced into Parliament
 Autumn 2011- Bill receives Royal Assent
 Ahead of Autumn 2011 – Policy development
 Autumn 2011 – Consultation
 Early 2012 – secondary legislation laid in Parliament
 Spring 2012 – detailed guidance prepared
 Autumn 2012 – First Green Deals appear



                                                          15
Green Deal and the Big Society




                                 16
                   Thank you



   GREEN DEAL AND THE
ian.trim@decc.gsi.gov.uk BIG SOCIETY



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