Government's Green Deal launched - Turn2us

The Department for Energy and Climate Change's Green Deal scheme launched on 1 October. The aim is to reduce carbon emissions by improving energy efficiency of British properties.

How does it work?

The Green Deal is a way to make energy efficiency improvements to your home without having to pay 'up front'. Instead, you pay for it for it by instalments on your electricity bill, for a period of up to 25 years. Paying through your bill is like a loan – but for your property, not the person. The payments are agreed at the start and the loan stays with the property after the bill payer moves on.

The Green Deal is designed to ensure that you won't pay back more than you are saving on your energy bill. This is called the Golden Rule. However, this is not a guarantee. The actual costs may exceed the estimated savings. For example, if your energy use increases or there is a fall in energy prices.

What steps are involved?

There are four steps: 

• Assessment: A Green Deal assessor or advisor assesses your home and recommends energy saving improvements through a Green Deal advice report
• Finance: A Green Deal provider gives you a quote for a Green Deal plan to pay for the improvements based on the Green Deal advice report. The will estimate the likely savings on your energy bills as a result of having the measures installed, and the likely period over which these savings will be made to ensure you are not paying back more than you are saving on your energy bills
• Installation: A Green Deal installer makes the improvements agreed under your Green Deal plan
• Repayment: You pay for these improvements through instalments on your electricity bill.

When is it available?

From 1 October 2012 qualified Green deal assessors can assess your property for energy saving home improvements.

From 28 January 2013 you will be able to take out a Green Deal finance plan.

Sources: Department for Energy and Climate Change (link opens in a new window); Citizens Advice Adviceguide (link opens in a new window); and Which? (link opens in a new window)