Accessing available funding
Vibrant’s Gregory Elliott looks at how the Green Deal has been relaunched, and how finance can be accessed to help fund energy efficient home improvements.
The Green Deal finance offering was first launched in 2013 with the objective of addressing the high number of energy inefficient properties in the UK. It gave homeowners and landlords loans to finance energy efficiency improvement measures to properties to bring the UK housing stock up to modern efficiency standards.
It has now been relaunched, in March 2017, with similar aims, and it offers homeowners and landlords the opportunity to access funding to help them meet the high capital costs of energy efficiency measures, such as solar panels or insulation.
In particular, Green Deal financing is designed to help:
- Those who face the heavy costs of needing to install a new boiler or other essential measures but who can’t afford to pay the upfront costs of doing so
- Those who want to increase the value of their homes through installing renewable energy or energy efficiency measures
- Landlords requested by tenants to install energy efficiency improvements or, as of April 2018, landlords who own properties that fall below the new Minimum Energy Efficiency Standards (MEES) EPC rating of E.
The idea of the Green Deal was underpinned by the ‘golden rule’, which uses the savings on the energy bill from the installed measures to pay the loan. The monthly repayments cannot be greater than the estimated savings – in effect it’s a ‘Pay-As-You-Save’ scheme.
The Green Deal Loan is more easily managed, as loan repayments are automatically deducted from a customer’s energy bill. Green Deal loan repayments are attached to the property, not the individual.
There are several benefits to Green Deal finance:
- Pay as you Save – estimated repayments are less than or equal to a typical customer’s expected monthly energy savings
- Post installation inspections carried out to ensure the validity of the installation and overall customer experience
- Multiple measures can be covered under one credit agreement
- No early repayment charges
- Finance stays with the house – so if the customer moves home it doesn’t move with them!
One of the main benefits to landlords is the ability to upgrade the property’s energy efficiency. It is one of a few solutions landlords can use in order to increase the EPC energy rating if under an E, to comply with the April 2018 Minimum Energy Efficiency Standards (MEES) regulation.
Whilst the first launch of the Green Deal finance faced several issues around processing and time taken to get the finance in place. However the newly relaunched Green Deal is now with a new finance company who have simplified the process taken to get the finance in place:
Vibrant are able to advise landlords on how they can utilise Green Deal funding to make improvements to their property’s energy efficiency. Call us on 01495 236150 to speak to one of our consultants.