Government ‘needs to revive the failing Green Deal scheme’

The government needs to consider adding new incentives to encourage energy efficiency, as its Green Deal pay-as-you-save scheme has failed to drive the scale of energy saving home improvements needed to cut carbon emissions and insulate consumers from high energy bills. So concludes the Energy and Climate Change Committee in a report: The Green Deal: watching brief published last month.

 

A combination of financial, communication and behavioural barriers has meant that the Green Deal has been slow to attract customers. Green Deal finance is, in principle, an attractive proposition, but the high interest rates attached to the loan were putting off potential customers as many households are able to find cheaper finance mechanisms elsewhere. DECC’s communication strategy has been confusing and has often conflated different energy efficiency schemes, adds the Committee. As a result, the government has struggled to drum up support even amongst those households that could benefit most from a Green Deal loan.

 

Tim Yeo MP, Chair of the Committee said: ‘Stamp duty discounts and variable council tax rates could be used to broaden the appeal of energy efficiency improvements and make them even more of a money saver for households. Extra incentives certainly need to be considered, as the government’s flagship pay-as-you-save finance scheme, the Green Deal, has only delivered a fraction of the expected benefits so far.’

 

The MPs are supportive of the principle of the Green Deal but believe the government needs to set out a clear strategy to revive the scheme and make it both clearer and more appealing to UK households.