24/Jul/2014 - Last News Update: 06:59

UK government to review Green Deal

Category: Politics

Published: 16th May 2012 07:38:42

Downing Street is about to review the government's Green Deal after warnings that it's liable to fail.

The Cabinet Office has been interviewing critics of the flagship scheme and is expected to report soon.

The Deal - to insulate the UK's aged housing stock - is designed to save carbon emissions, keep people warm, and make energy affordable.

But critics say it won't give enough help to the fuel poor, and warn it may waste £2-3bn of people's energy bills.

They say this is a scandal after the recent warning that the number of people unable to afford their energy bills is likely to rise to 8.5 million.

The Green Deal is split into two parts. The larger part relies on householders voluntarily taking pay-as-you-save loans to cut energy bills through home insulation. The private sector is supposed to deliver the improvements.

The other part of the programme, known as ECO, will subsidise people to insulate their homes if they can't do it without help. This will be funded through a £1.3bn-a-year charge against all of our energy bills.

But there is a dispute over the priorities.

The government says most lofts and cavity walls are already insulated under previous schemes so it wants to offer grants on much more expensive solid wall insulation.

Solid walls will ultimately have to be made warmer if the UK housing stock meets expectations for reducing carbon emissions. But it is thought that at first this expensive and disruptive option will be mostly taken up by affluent households.

It is crazy if the Green Deal fails to ensure that all the homes in the country at least have adequate loft insulation”

Critics say it makes no sense to insulate solid walls at approximately £7,500 a home when you can insulate lofts of the "fuel poor" for £500 a home.

They also argue that the ECO subsidies scheme will force low-income families to pay extra on their fuel bills to subsidise solid wall insulation for more wealthy homes.

Complaints have been so widespread that a Cabinet Office team was detailed to interview the critics, who estimate that by pushing money towards solid walls rather than lofts the government could waste between £2bn and £3bn of energy bill payers' money in coming years.

"It is crazy if the Green Deal fails to ensure that all the homes in the country at least have adequate loft insulation," said Andrew Warren of the Association for Conservation of Energy, an industry lobby group.

"Loft insulation and cavity wall insulation are the basic first steps in terms of effectiveness. Treating solid walls is a very much more expensive option that'll have to be paid for by the energy consumers whose bills will be funding the Green Deal.

"The number of people in fuel poverty is rising. If you get the policy right you can tackle fuel poverty by getting everyone's lofts and cavity walls insulated."

This was a common criticism when the government opened the Green Deal to consultation at Christmas, and ministers have shifted ground since.

In April, the Deputy Prime Minister Nick Clegg promised that of the £1.3bn ECO subsidies, at least £540m should save energy in the worst-off homes. He said: "Each year this money will help 180,000 of the poorest households make their homes cheaper to heat for good."

But this doesn't go far enough for the critics, who are baffled by the Department of Energy and Climate Change's (Decc) assertion that it is time to focus on solid walls because almost all lofts and cavity walls are already done.

A recent Decc document shows that only 60% of homes (14.1 million out of 23.3 million) currently have an adequate insulation blanket of at least 125mm.

Ron Campbell of the charity National Energy Action told BBC News: "There is no question - all of the resources under ECO should be devoted to programmes related to poverty.

"We were constantly reassured that funding under ECO would be significantly higher than government funding in previous years but this is untrue. Expenditure on fuel poverty programmes is half of what it was."

The pay-as-you-save side of the Green Deal is also wobbling because few people in the energy sector believe it will deliver the savings in energy and carbon needed for UK climate change targets. Buildings are responsible for more than 40% of UK emissions.

The Cabinet Office team has been told that the Chancellor should nudge people into the Green Deal by changing Stamp Duty to reward householders who have insulated their homes, or punish those who haven't.

The government hope that the energy firms will promote the Deal to householders. But energy conservation is a notorious hassle and critics say it'll need a huge national public campaign.

A Green Alliance report compared the Green Deal with the recent digital TV switchover and concluded: "There is a huge risk that the government's current plans for communications won't deliver the levels of take-up needed to make sure the Green Deal (is) a success." The author, Faye Scott, says the scheme needs strong, trusted national branding.

But I understand that the International Energy Agency has warned that many people won't participate in the scheme because they don't trust the energy firms after rows over high prices and mis-selling of products.

The government insists that insulation schemes offered under the Green Deal should follow the so-called Golden Rule that the improvements must be paid back during the agreed loan period.

A trial in Sutton in South East London suggested that bills were reduced by between £170 and £270 a year. Press report said that under that trial 25% of improvements did not meet the Golden Rule.

Sutton Council told BBC New that the households in question were informed that their investments would not pay back in time but had opted to go ahead with them anyway because they felt that energy bills would go up in future, they wanted to improve comfort in the home, or they were willing to invest in energy-saving to protect the environment.

BBC News External Link Show Citation

Latest News

Harvard Citation

BBC News, 2012. UK government to review Green Deal [Online] (Updated 16th May 2012)
Available at: http://www.ukwirednews.com/news/1428851/UK-government-to-review-Green-Deal [Accessed 24th Jul 2014]

News In Other Categories

  • Websites frozen in pension campaign

    Eighteen websites have been suspended and arrests made during a campaign, being revamped on Thursday, against pensions cash "predators".
  • Glasgow 2014: Bradley Wiggins - At times I wish I hadn't won Tour

    Sir Bradley Wiggins says there have been times when he wishes he had never won the Tour de France and Olympic gold in 2012 that brought him national fame.
  • Wildlife film-makers reveal tricks of the trade

    New camera technology is allowing wildlife film-makers to get ever more stunning shots. But can we believe everything we see on natural history programmes? And why do hyenas keep eating the cameras?
  • Bristol Academy extends reach overseas with first foreign students

    With the doors to its brand new £1million training centre officially open, one of the UK's leading apprentice training providers, Bristol based S&B Automotive Academy, is showcasing its world-class facilities by launching a series of foreign student exchanges for the first time in its 41-year history. To get a flavour of what life is like as an apprentice in the UK, the Academy hosted 16 apprentice engineers and bus drivers from the G9 Automotive College in Hamburg, Germany, as part of a Europe-wide vocational training initiative called the ‘Leonardo Programme’ with support from the European Social Fund. In a reciprocal arrangement, S&B will be sending nine apprentices to Germany during February 2012 so that they can get an appreciation of life in the automotive industry on the Continent. A further three German exchange groups are being planned for next year. Designed to assist the development of vocational skills and training across Europe, including work placements for trainees, the Leonardo Programme has a budget of €1.75bn, which is helping to encourage UK organisations to work with their counterparts abroad. In what is expected to be another challenging year for employers in the UK automotive sector, S&B’s Chief Executive, Jon Winter, claims that the exchange initiative will bring many benefits to the Academy and its apprentices: “In a world of global automotive brands, it’s important for our learners to understand the international context of the industry they have chosen to make their career. This new exchange programme will enable apprentices and Academy staff alike to achieve a better understanding of the challenges and opportunities within the automotive arena in Europe. With the Academy’s influence also extending to the USA and Asia, there’s every possibility that this initiative could move further afield in the future.” Continued Winter: “The need for skilled technicians across the world is on the increase and we actively encourage our apprentices to look at broader horizons during their training. Many of them have already learned the phrase ‘Vorsprung durch Gelehrtheit’, quite simply, ‘Advancement through learning.” In the 2010/11 academic year, S&B doubled the number of successful Apprenticeships over the previous year with some 350 apprentices graduating from the Academy. At the same time, achievement levels reached an all-time high with an overall success rate of 85%. For those learners on the Advanced Apprenticeship three-year programme, success rates were even higher, at over 98%. PHOTO CAPTION: As part of their exchange visit, S&B Automotive Academy arranged for the German apprentices to visit Hampshire bus operator, Bluestar, at its Barton Park depot. The students are pictured with S&B’s Andy West (3rd right) and Steve Prewett, Bluestar’s Area Engineering Manager (2nd right). Ends http://www.sandbaa.com
  • Liverpool Giants: The life of a Lilliputian

    As spectacular as the Giants show in Liverpool promises to be, organisers say it would be nothing without its army of "Lilliputians", the people who animate the huge marionettes.
  • Council redundancy costs nearly double in a year

    Cash-strapped Welsh councils have spent nearly twice as much on making staff redundant as they did last year, BBC Wales has learned.